DRAFT

OKLAHOMA DEPARTMENT OF ENVIRONMENTAL QUALITY AIR QUALITY DIVISION

MEMORANDUM May 4, 2006

TO: Dawson Lasseter, P.E., Chief Engineer, Air Quality Division

THROUGH: Grover Campbell, P.E., Existing Source Permits Section

THROUGH: Phil Martin, P.E., New Source Permits Section

THROUGH: Peer Review

FROM: Iftekhar Hossain, P.E., Engineering Section

SUBJECT: Evaluation of Permit Application No. 97-227-TV Atlas Pipeline Mid-Continent, L.L.C. Velma Gas Plant Section 23-T1S-R5W, Stephens County Location: 1 mile west of Velma on old Highway 7, south side of the road.

SECTION I. FACILITY DESCRIPTION

Permitting Status Texaco Exploration & Production Inc. (TEPI) submitted an application for a Title V operating permit for their Velma Gas Processing Plant (SIC 1321) on March 6, 1997. Spectrum Field Services, Inc., purchased the Velma Plant from TEPI on July 14, 2000, and operated it until July 2004 when Atlas Pipeline Partners, L.P. Mid-Continent (Altas) operations acquired it. Atlas then operated the facility under the name Spectrum Field Services, L.L.C. until later changing the name to Atlas Pipeline Mid-Continent, LLC. The facility has been operating under Permits No. 74-008-O, 76-070-O, 77-036-O, 77-047-O, 77-059-O, 78-004-O, 91-025-O, and 97-227-C. Most of the units in the facility are either “grandfathered” or “exempt” from permitting requirements based on regulatory exemption in effect at the time of construction. TEPI applied for several applicability determinations (93-023-AD, 96-051-AD, and 96-154-AD) for different units to resolve some controversial specific conditions of the permits. This permit application is for consolidation of all the previous permits into this Title V operating permit. The following is a brief description of the existing permits and the history of the plant.

#74-008-O This permit, issued on July 20, 1973 to Skelly Oil Company, authorized operation of 5 non- methane hydrocarbon storage tanks. Two of the tanks stored propane and three stored demethanized natural gasoline. All of the tanks are pressurized vessels, and are therefore, considered trivial emission sources. PERMIT MEMORANDUM 97-227-TV DRAFT Page 2

#76-070-O This permit was issued on June 7, 1977 to Getty Oil Company. It authorized the operation of the gas dehydration unit at the Velma Gas Plant.

#77-036-O On June 6, 1977, Getty submitted a permit application to modify their amine treating system which was approved under Permit #77-036-C. This permit authorized an expansion of the amine system to 80 MMCFPD, an increase in amine recirculation capacity, and installation of a 170' flare stack for SO2 pollution abatement. Permit #77-036-C authorized 350 lbs of SO2/hr (1,533 tons/yr annual emissions) from the acid gas flare. The increase in facility size was required to process larger volumes of gas (with increased CO2 concentrations, but no corresponding increase in H2S concentration) and corresponding amine volumes.

#77-047-O This permit was issued on July 10, 1978 to Getty Oil Company. It authorized the installation and operation of a cryogenic natural gas processing unit. Four Cooper Bessemer GMVH-10 engines were installed as part of this permit authorization. No special conditions were included in the issued operating permit. No applicable requirements beyond state regulations were addressed in the permit evaluation. At the time, PSD did not apply and state regulations specifically exempted internal combustion engines from permitting requirements.

#77-059-O This permit was issued to Getty Oil Company on September 26, 1977 and authorized the installation of a 7,000 lbs steam/hr (10 MMBtu/hr) natural gas-fired steam boiler. No specific requirements were included with issuance of this permit.

#77-094-C This permit application was submitted by Getty Oil for a remote field H2S Removal Unit. In a letter dated January 23, 1978, Grant Marburger, Head, Permit Section stated that the application was reviewed and that no permit was necessary for the installation. No permits were issued with this application.

#78-004-O This permit, issued on February 27, 1978 to Getty Oil Company, allowed a modification of a gas sweetening unit to seven satellites, remotely-operated amine treaters. Specifically Permit #78- 004-0 authorized 100 lbs/hr hydrogen sulfide from each of the satellite amine treaters and Regulation 16 allowed 100 lbs/hr for the reactivated amine treater, for which Air Quality determined no permit was necessary. Inclusive of the 350 lbs/hr allowed by Permit #77-036-0, a total of 950 lbs/hr was permitted for the Velma Plants' sour gas sweetening unit (SGL) equaling 4,161 tons/yr annual allowable S02 emissions. No specific conditions were attached to this permit.

#81-057-C This permit application was also submitted for a remote field H2S Removal Unit by Getty Oil Company. Again, AQD determined that no permit was necessary.

#91-025-O PERMIT MEMORANDUM 97-227-TV DRAFT Page 3

This permit was issued to Texaco Exploration and Production, Inc., on July 8, 1991. The permit application was for a change in the plant's sweetening unit back to a single existing amine treater located at the plant site and to install sulfur recovery equipment to stay within the NAAQ Standards. In 1990, the Air Quality Service determined that a permit would be required and the equipment would be subject to NSPS Subpart LLL and OAC 252:100-31. No applicability determination was performed for this beyond a few statements in the evaluation memo for Permit #91-025-C. Permit #91-025-C was issued in July 1991 and authorized construction of a 10 LT/D sulfur removal unit (SRU) and changing the Velma Plant's sour gas sweetening unit from seven (7) amine treaters to one (1) amine treater unit. Permit #91-025-0 was issued in October 1993. It authorized operation of the sweetening unit at only 4.1 LT/D, based upon the performance test results. The sweetening unit could not be tested at the SRU's design rate of 10.1 LT/D because the quantity of gas necessary to do so was not available. The Velma Plant does not have the capacity to store or stockpile the quantity of gas necessary to enable it to performance test at 10.1 LT/D; therefore, it was dependent upon the amount of field gas available at the time the test was conducted. Subsequently the tail gas incinerator on the SRU was limited to 174.7 lbs/hr SO2.

#97-227-C This permit application was submitted in August of 1997 to request authorization to construct four new fixed, cone roof tanks at the Velma Gas Plant by Texaco Exploration and Production, Inc. Two 400-barrel storage tanks were to store condensate prior to loading to tank trucks. The other two 390-barrel tanks were to store wastewater to replace an open water pit.

This facility emits more than 100 TPY of NOx, CO, VOCs and SO2. It is, therefore, a major source as defined in Oklahoma Air Pollution Control Rules. The state rules for SO2 are applicable to both new and the existing units.

Historical Overview The Velma Gas Plant was originally constructed in 1948 by Skelly Oil Company as lean oil, liquid extraction process plant. The Velma Gas Plant also included some natural gas sweetening capabilities. Getty Oil Company, a Delaware Corporation, purchased and took over the Velma Plant on January 31, 1977. In 1984, the Getty Oil plant was purchased by Texaco Inc. and the Velma Plant was consolidated into Texaco Exploration and Production Inc., Texaco’s wholly owned subsidiary. In 1991 Texaco added the Sulfur Recovery Unit, Tail Gas Incinerator, and Amine Reboiler. On March 6, 1997, TEPI submitted an application for a Title V operating permit for their Velma Gas Processing Plant. Spectrum Field Services, Inc. purchased the plant July 14, 2000.

(i) Spectrum Field Services, Inc. submitted an Applicability Determination on March 27, 2003 for determination of whether a construction permit was required for the addition of electric powered compressors (for replacement of original natural gas fired emission units), a small regeneration heater, and replacement of like kind inlet and outlet scrubbers for the amine contactor. (ii) Spectrum Field Services, Inc. filed a “Minor Permit Modification” on April 25, 2003 to obtain approval to initiate an electrification project. On July 1, 2003 Spectrum resubmitted the “Minor Modification” upon the request of the ODEQ. PERMIT MEMORANDUM 97-227-TV DRAFT Page 4

(iii) Spectrum then filed another “Minor Modification” on September 2, 2003 to add a glycol dehydration unit. The glycol dehydration unit was installed to remove moisture from the gas used to dehydrate the mole sieve beds. (iv) In March of 2004, Spectrum filed a “Minor Modification” to remove the existing sulfur recovery unit which includes a tail gas incinerator. Spectrum also requested to install an acid gas compressor powered by an electric motor that would send the acid gas to a recently constructed acid gas injection well.

In July of 2004 Atlas Pipeline Partners, L.P. Mid-Continent operations acquired Spectrum Field Services, Inc. and changed the name to Spectrum Field Services, L.L.C. Then,

(i) In August of 2004, Spectrum requested to install another propane refrigeration electric compressor for additional propane refrigeration in the plant and associated fugitive components. (ii) In early October 2004, Spectrum requested to install a temporary 1,072-hp Natural Gas Compressor, type, Waukesha 5108 GL engine, powered by a gas motor and associated fugitive components. (iii) Later in October 2004, Spectrum then requested to install a 2,500-hp electric driven residue compressor, to take the place of the temporary, gas powered compressor mentioned above and associated fugitive components. The temporary compressor and its associated fugitive components were removed on April 30, 2005.

The company name has now been changed to Atlas Pipeline Mid-Continent LLC, effective January 1, 2005.

Compliance and Enforcement Action The facility was in violation for emitting about 30 tons/year of formaldehyde, which is a HAP, from 36 natural gas fired engines. On April 15, 2003, DEQ issued Notice of Violation (NOV) No. 03-AQN-088 to Spectrum alleging the following:

(i) Spectrum was operating the facility in non-compliance with the standards and requirements of 40 CFR Part 63, Subpart HH; (ii) Spectrum failed to submit the Notification of Compliance Status Report by December 14, 2002 as required by Subpart HH; (iii) The facility’s emissions of formaldehyde, a category A air toxic, were in excess of MAAC level which was a violation of Oklahoma regulations for “Control Of Emissions Of Hazardous Air Pollutants And Toxic Air Contaminants (Subchapter 41).”

On April 21, 2005, the issues of noncompliance of Spectrum were resolved in Consent Order No. 05-084. According to the Consent Order, Spectrum paid $17,500 penalty and agreed to comply with Subpart HH (as per EPA’s policy of “once in, always in”).

Process Description The Velma Gas Plant is a 100 MMCF/D natural gas processing plant. Gas processing operations at the plant include liquid extraction, gas sweetening, natural gas compression, and dehydration. The facility has two inlet streams. The first is a low pressure (1-8 psig) sour gas stream. The PERMIT MEMORANDUM 97-227-TV DRAFT Page 5 second is high pressure (800 psig) sweet gas from the East Doyle Booster Station, and the Plato Booster station.

The low pressure sour gas stream is compressed at the plant to about 300 psig. From here, the sour gas is directed to the amine sweetening system for removal of H2S and CO2. The sweetened gas is compressed to about 750 psig and co-mingled with the East Doyle sweet gas. The sweetened gas stream enters the cryogenic skid where the natural gas liquids are removed. The liquids (ethane, propane, and C4+ mix) are transported from the plant by a third party natural gas liquids pipeline. The residue gas (predominantly methane) is then recompressed, sold, and transported directly into a natural gas pipeline.

The Velma Gas Plant utilizes one hot oil regenerated glycol dehydration unit for the inlet gas and one direct-fired glycol dehydration unit for the regeneration of glycol. The inlet glycol dehydrator is used to remove moisture from the natural gas stream. The overhead still vapors from the dehydrator are condensed and recovered. The noncondensible gas is rerouted to the first stage inlet and reprocessed. The regeneration glycol dehydrator unit is used after initial dehydration to remove moisture from the glycol before it is regenerated.

The sour natural gas stream from the amine system is then sent to an acid gas compressor powered by an electric motor. Once the acid gas is compressed, it is then sent to an acid gas injection well for disposal.

SECTION II. EQUIPMENT The Velma Gas Plant operates 9 compressors powered by electric motors. There is also one acid gas compressor with an electric motor that compresses the acid gas before sending it to an injection well. The plant uses a natural gas-fired boiler to heat water and make steam, a natural gas-fired heater for hot oil service, a natural gas-fired amine reboiler, and a natural gas fired regeneration heater. Natural gas is dehydrated using a glycol absorption system and the glycol is regenerated using hot oil. Similar types of emissions units have been grouped together as emissions unit groups (EUGs) to facilitate the tracking of the emissions units. There are several pressurized tanks (covered by a vapor recovery system), with no emissions, that are not listed in the tank emission unit groups. The following tables show the listing of all equipment at the facility.

Table 1 Natural Gas Fired Heaters and Boilers (EUG 1) Capacity EU Point Equipment Serial # Install/ Modify Date (MMBTU) H-1 P-35 Hot Oil Process Heater #1 8.0 363 1947/87-Rerate B-1 P-38 Plant Boiler 6.7 8083 1977

Table 2 Gas Sweetening (EUG 2) EU Point Equipment Capacity Install/Modify Date AGF P-40 Acid Gas Flare -- 1977 AU P-41 Amine Unit -- 1977/1991 MEF P-42 Main Plant Emergency Flare 600,000 scf/day N/A PERMIT MEMORANDUM 97-227-TV DRAFT Page 6

Table 3 Amine Reboiler (EUG 3) EU Point Equipment Capacity (MMBTU/hr) Serial # Installed Date H-101 P-44 Amine Reboiler 16.84 91-014 1991

Table 3A Hot Oil Circulated from H-1 Hot Oil Process Heater (EUG 3A) Capacity Installed EU Point Equipment Serial # MMBtu/hr or #/hr Date NA NA Inlet Glycol Reboiler 4.2 MMBtu/hr N/A 1977 NA NA Amine Still Reboiler 42869 #/hr circulated J-505-1 1977 The Amine System, to which the above amine still reboiler belongs to, is used to sweeten a liquid product stream. All H2S and CO2 are piped to the acid gas compressor then to the acid gas injection well. Reboilers are in closed systems with no emissions to the atmosphere.

Table 3B Regeneration Glycol Dehydration Unit Reboiler (EUG 3B) EU Point Equipment Capacity Serial # Installed Date (MMBTU) GD P-64 Glycol Dehy Unit Reboiler 0.5 12677 2003

Table 4 Tanks (EUG 4, EUG 5, EUG 6) EUG 4 Tanks Capacity Throughput Installed EU Point Contents (bbl.) (bbl.) Date T-1 P-45 Scrubber Oil Tank #1 500 10,312 8/1979 EUG 5 Tanks T-2 P-46 Scrubber Oil Tank #2 500 10,312 1/1996 EUG 6 Tanks T-4* P-57 Condensate 400 48,880 1999 T-5* P-58 Condensate 400 48,880 1999 T-6 P-59 VOC/Water 390 71,332 1999 T-7 P-60 VOC/Water 390 71,332 1999 T-8* P-61 Produced Water/Condensate 390 26,368 1996 T-9* P-62 Condensate 714 18250 2004 T-10* P-63 Condensate 714 4563 2004 *No emission limits were established since the vapor recovery system eliminates emissions by rerouting them into the plant inlet.

Table 5 Oil/Water Separator (EUG 7) EU Point Contents Capacity (bbl.) Installed Date OWS-2 P-48 Oil/Water 409 7/1995 PERMIT MEMORANDUM 97-227-TV DRAFT Page 7

Table 6 Leaking Components – Fugitive Sources (EUG 8) EU Point Equipment Name of Items Number of Items Installed Date Valves 2795 Connectors / Flanges 2436 Piping Pump Seals 28 Plant N/A 1948-2004 Components Pressure Relief Valves 33 Compressors 10 Others 3

Table 7 Truck Loading (EUG 9) EU Point Contents Installed Date Tank Truck Condensate and Natural Gas Liquid TL-1 P-55 1948 (NGL) Loading Relief Vent TL-2 P-56 Tank Truck Crude Loading 1948

Table 8 Stack Parameters EU Point Source Number Height Diameter Flow Temp. Stacks (feet) (feet) (acfm) (deg F) H-1 P-35 Born-Hot Oil Heater #1 1 42 3.0 NA 800 B-1 P-38 Plant Boiler 1 24 1.3 2491 800 AGF P-40 Acid Gas Flare 1 170 1.0 243 NA MEF P-42 Main Plant Emergency Flare 1 112 2.3 NA 110 H-101 P-44 Amine Reboiler 1 25 3.3 NA 250 GD P-64 Glycol Dehydration Reboiler 1 20.42 1 40.28 347

SECTION III. AIR EMISSIONS The emission units for the facility have been grouped for convenience. The following is a brief description of each emission group.

EUG 1 - Process Heaters and Boilers This group includes Process Heater #1 (H-1), Boiler #1 (B-1), and the inlet gas glycol dehydration unit. The inlet gas glycol dehydration unit does not emit significant amounts of HAPs because the overhead still vapors are condensed and recovered. Noncondensible gases are rerouted to the first stage inlet and reprocessed.

The emissions from the (0.3-10.0 MMBTUH) heat input heaters and boilers in EUG 2 were obtained from Section 1.4 (Natural Gas Combustion) in AP-42 (7/98). Table 1.4-1 contains emission factors for NOX, and CO. Table 1.4-2 provides VOC, SO2 and PM (filterable and condensable) emission factors. Table 1.4-3 contains emission factors for total organic compounds. PERMIT MEMORANDUM 97-227-TV DRAFT Page 8

Table 9 Emissions from Natural Gas Fired Heaters and Boilers (EUG-1) NO CO VOC PM SO EU# Emission Units X 2 lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY 8 MMBTUH H-1 0.78 3.44 0.66 2.89 0.04 0.19 0.06 0.26 0.00 0.02 Hot Oil Heater #1 6.7 MMBTUH B-1 0.66 2.88 0.55 2.42 0.04 0.16 0.05 0.22 0.00 0.02 Plant Boiler Unit #1

EUG 2 - Gas Sweetening This group includes the amine contactor and the acid gas flare (Table 2). There are no significant amounts of HAPs associated with these units. Acid gas is only diverted to the acid gas flare during upset conditions when the acid gas compressor is not operable.

The acid gas flare is subject to requirements of OAC 252:100-31. For episodic flaring from the acid gas flare and the main plant emergency flare, the most stringent emission standard (24-hour average) for SO2 is based on OAC 252-100-31-7(a)(4). Air quality dispersion modeling indicates that, in order to meet the 24-hour ambient air concentration standard of 130 ug/m3, the acid gas flare SO2 emissions must be less than 162 lb/hr, which is superseded by the allowed emission limit of 100 lb/hr or less, two-hour average, without use of any SRU. Actual calculations assume 100% efficiency of conversion of H2S to SO2. Flare emission calculations (in lb/hr) are based on the flow to the flares and the sulfur content of the acid gas.

Table 10 Sulfur Plant (EUG-2) NO CO VOC SO EU# Emission Units X 2 lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY AGF Acid Gas Flare --- 2.20 --- 11.70 ------100.00 Main Plant 220.75 MEF 1.40 6.13 7.40 32.41 3.00 13.14 100.00 Emergency Flare Note: the annual emission limit for these sources is not additive since they do not operate at the same time but represent operating alternatives. AGF and MEF shall have the flexibility to operate up to 220 tpy. Emissions from Main Plant Emergency Flare are from Manufacturers Data (other than SO 2, which is based on modeling results).

EUG 3 - Amine Reboiler Unit The amine reboiler unit is classified as a process heater as defined by NSPS, Subpart Dc and, therefore, is not applicable to any standards contained in Subpart Dc. The emission factors used to calculate the emissions from the amine reboiler are found in AP-42, Section 1.4 (7/98). Table 1.4-1 provides NOX and CO emission factors for category small (<100 MMBTUH heat input) boilers and Table 1.4-2 provides VOC, PM (filterable and condensable), and SO2 emission factors.

Table 11 Emissions from Amine Reboiler (EUG 3)

Emission NOx CO VOC PM SO2 EU# Units lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY Amine H-101 1.65 7.23 1.39 6.07 0.09 0.40 0.13 0.65 0.01 0.04 Reboiler EUG 3B – Regeneration Glycol Dehydration Unit Reboiler PERMIT MEMORANDUM 97-227-TV DRAFT Page 9

The glycol dehydration unit has two emissions sources associated with it, the reboiler vent and the glycol still vent. The glycol still vent emits water and any hydrocarbons or BTEX from the boiling off of the components to make “Lean Glycol”. The lean glycol still vent emissions flow through the JATCO condenser and then are routed into the flame zone of the burner section where they are combusted with the residue gas used as fuel in the reboiler and vented to the atmosphere through the reboiler vent. The emissions from the glycol dehydration unit reboiler were calculated using the emissions factors in AP-42, Section 1.4 dated 7/98 in Tables 1.4-1-1.4- 3. Pre-control emissions from the TEG dehydrator were calculated using GRI’s GLYCALC version 4.0 program. A control efficiency of 98% for the JATCO condenser and remaining vapors in the reboiler was applied to determine the controlled emissions.

Table 12 Emissions from Regeneration Glycol Dehydration Unit Reboiler

EU Emission NOx CO VOC PM SO2 # Units lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY Glycol Dehy. GD 0.15 0.64 0.12 0.54 0.01 0.04 0.01 0.05 0.00 0.00 Reboiler

EUG 4, 5, 6- Tanks This group includes scrubber oil tanks #1 and #2, loading tanks, and wastewater tanks.

Calculations for T-1 and T-2 were based on 1995 emissions inventory calculations. VOC emissions from the gasoline tanks were estimated using TANKS4 (Based on AP-42) computer model. The unleaded and raw gasoline tanks are currently idle.

Table 13 Tanks (EUG-4, 5, 6) Emission Unit VOC Emission EU# lb/hr TPY T-1 Scrubber Oil Tank 0.27 1.20 T-2 Scrubber Oil Tank 0.27 1.20 T-4 Condensate* 0.00 0.00 T-5 Condensate* 0.00 0.00 T-6 VOC/Water 9.44 1.07 T-7 VOC/Water 9.44 1.07 T-8 Produced Water/Condensate* 0.00 0.00 T-9 Condensate Tank* 0.00 0.00 T-10 Condensate Tank* 0.00 0.00 Subtotal 19.49 4.79 *No emission limits were established since the vapor recovery system eliminates emissions by rerouting them into the plant inlet.

EUG 7 - Oil Water Separators This group includes the gun barrel (oil-water separator #2). Emissions for the OWS-2 were as reported in the 1995 Emission Inventory. This emission unit will qualify as an insignificant or trivial activity (Table 18).

Table 14 Oil Water Separators (EUG-7) EU# Emission Unit VOC Emission PERMIT MEMORANDUM 97-227-TV DRAFT Page 10

lb/hr TPY OWS-2 Gun barrel oil-water separator #2 0.55 2.40

EUG 8 - VOC Leaking Components Fugitive Emissions This group includes all the valves, flanges, connectors, compressors, open-end lines, etc. in the facility. These are all potential sources of leaking nonmethane hydrocarbons (NMHC). Emissions from these sources are listed in Table 15.

The method used to estimate VOC fugitive equipment leaks from the existing equipment was found in the EPA Emission Standards Division’s document EPA-453/R-95-017 1995 Protocol for Equipment Leak Emission Estimates, November 1995.

Table 15 Leaking Components – Fugitive Emissions (EUG 8)

VOC Emissions H2S Emissions EU# Emission Unit lb/hr TPY lb/hr TPY Plant Fugitive Sources 5.68 24.90 0.07 0.29

EUG 9 - Tank Truck Loading Operations This group consists of the tank truck loading of condensates and associated emissions from the truck loading relief vent, the tank truck loading of crude oil, and the tank truck loading of natural gas liquids (NGL). All three of them have been in existence since 1948.

Fugitive VOC emissions from tank truck loading are based on AP-42 (1/95), Section 5.2.2, titled “VOC Emission Factors for Gasoline Loading Operations”, Table 5.2-2.

Table 16 Fugitive VOC Emissions from Tank Truck Loadings (EUG-9) Throughput VOC Emission Emissions Unit bbl/month gallon/yr lb/hr TPY Tank Truck Loading (Condensate and Natural Gas 10,000 5,040,000 92.47 135.00 Liquids) Tank Truck Loading (Crude Oil) 10,000 5,040,000 0.68 1.00

The emissions presented for tank truck loading of condensate, natural gas liquids, and crude oil were taken from the 1995 emissions inventory. Emissions were calculated using AP-42. These emissions no longer exist due to sales thru LACT unit, but due to market conditions and production factors the operation may change. In such case, these emission calculations are presented to preserve this grand-fathered capacity and the ability to tank truck the condensate, crude oil, and natural gas liquids from the facility. PERMIT MEMORANDUM 97-227-TV DRAFT Page 11

Hazardous Air Pollutants (HAPs)

Glycol Dehydration Unit The glycol dehydration unit using glycol desiccants emit benzene, toluene, ethyl benzene, xylenes, and n-hexane from the still vent stack which are regulated as hazardous air pollutants (HAPs). The applicant has analyzed the concentrations of HAPs emissions of this unit using GRI-GLYCalc™ version 4.0 software model, an extended inlet gas analysis, a glycol recirculation rate of 6.99 gallons per minute (gpm), and an estimated throughput of 5.0 MMSCFD. A HAP control efficiency of 99.56% was applied to the condenser and remaining vapors in the reboiler to determine the controlled emissions. The HAP emissions from the stack vent of the condenser is as shown in the following table.

Table 17 HAP Emissions from Glycol Dehydration Unit CAS# Estimated Emissions Pollutant lb/hr TPY Benzene 71-43-2 0.0025 0.0111 Toluene 108-88-3 0.0229 0.1002 Ethylbenzene 75-04-7 0.0029 0.0127 Xylene 1330-20-7 0.0180 0.0788 n-Hexane 110-54-3 0.0011 0.0050 Total 0.0474 0.2078

The estimation shows that the facility emits 0.21 TPY of HAPs from the glycol dehydrator unit. Even though the facility is not a major source for HAP, still it is subject to 40 CFR Part 63, Subpart HH as per Consent Order No. 05-084.

SECTION IV. INSIGNIFICANT ACTIVITIES The plant also has various emission sources which are insignificant or trivial by definition. The sources in this group were categorized as insignificant/trivial activities based on the guidelines in the AQD Title V Permit Application workshop. Trivial activities include maintenance painting, degreasing, and welding, truck and personal vehicle traffic, emissions from the blowdown of compressors during maintenance and from upset conditions, the lube oil tank, and use of a corrosion inhibitor in the boiler.

The cryogenic skid was manufactured in 1977 and installed in 1978. It is not subject to NSPS Subpart KKK. The cryogenic unit and the safety/pressure relief vent are categorized as insignificant or trivial activities. Reported emissions on the 1995 emission inventory for these units are in Table 18.

Also considered insignificant sources are: engines FW-1 and FW-2, the west plant (DOT) emergency flare, and produced water tanks. There are insignificant amounts of HAPs associated with these units.

“Jim’s tank”, a 220 bbl. tank used to store used lube oil, is considered an insignificant source as well. The tank is reclaimed when a load (70 bbl.) is accumulated. In 2002, 1 load of 59 bbl. was hauled in late June. It is estimated that the approximate annual throughput is 120 bbl. The PERMIT MEMORANDUM 97-227-TV DRAFT Page 12

4.2 MMBtu regeneration process heater installed in 2003 was considered an insignificant source as well.

Table 18 Emissions from Insignificant and Trivial Sources

NOX CO VOC SO2 EU# Emission Unit lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY Plant #1 Cryogenic Skid 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 West Plant (DOT) Emergency Flare 0.10 -- 0.70 -- 1.20 -- 1.20 -- FW-1 Waukesha F817 GU (Fire Water) 2.16 0.54 0.30 0.07 0.09 0.02 -- -- FW-2 Caterpillar 3208 DIT (Fire Water) 5.64 1.41 0.78 0.19 0.22 0.06 -- Jim's Tank Used Lube Oil ------Amine MEA Regenerator ------Contactor Compressors Blow down Emissions ------0.97 4.25 -- -- Regen 4.2 MMBtu Regeneration Heater 0.35 1.51 0.41 1.80 0.02 0.10 0.00 0.01 Heater Total 8.25 3.46 2.19 2.06 2.50 4.43 1.20 0.01

Table 19 Summary of Total Air Emissions

NOx CO VOC PM SO2 EU # lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY H-1 0.78 3.44 0.66 2.89 0.04 0.19 0.06 0.26 0.00 0.02 B-1 0.66 2.88 0.55 2.42 0.04 0.16 0.05 0.22 0.00 0.02 AGF -- 2.20 -- 11.70 ------100.00* 220.75* MEF 1.40 6.13 7.40 32.41 3.00 13.14 100.00* H-101 1.65 7.23 1.39 6.07 0.09 0.40 0.13 0.65 0.01 0.04 GD 0.15 0.64 0.12 0.54 0.01 0.04 0.01 0.05 0.00 0.00 T-1 – T-8 ------19.42 4.26 ------T-352-356 ------3.85 16.95 ------OWS-2 ------0.55 2.40 ------Fugitives ------4.92 21.71 ------Truck Loading ------93.15 136.00 ------Insig & Trivial 8.25 3.46 2.19 2.06 2.50 4.43 -- -- 0.003 0.01 Total 12.89 25.98 12.31 58.09 127.57 199.68 0.25 1.18 100.01 220.84 *The emission limits for these sources are not additive since they do not operate at the same time but represent operating alternatives. PERMIT MEMORANDUM 97-227-TV DRAFT Page 13

SECTION V. OKLAHOMA AIR POLLUTION CONTROL RULES

OAC 252:100-1 (General Provisions) [Applicable] Subchapter 1 includes definitions but there are no regulatory requirements.

OAC 252:100-3 (Air Quality Standards and Increments) [Applicable] Primary Standards are in Appendix E and Secondary Standards are in Appendix F of the Air Pollution Control Rules. At this time, all of Oklahoma is in attainment of these standards.

OAC 252:100-4 (New Source Performance Standards) [Applicable] Federal regulations in 40 CFR Part 60 are incorporated by reference as they exist on July 1, 2002, except for the following: Subpart A (Sections 60.4, 60.9, 60.10, and 60.16), Subpart B, Subpart C, Subpart Ca, Subpart Cb, Subpart Cc, Subpart Cd, Subpart Ce, Subpart AAA, and Appendix G. These requirements are covered in the “Federal Regulations” section

OAC 252:100-5 (Registration, Emissions Inventory and Annual Operating Fees) [Applicable] Subchapter 5 requires sources of air contaminants to register with Air Quality, file emission inventories annually, and pay annual operating fees based upon total annual emissions of regulated pollutants. Emission inventories have been submitted and fees paid for the past years.

OAC 252:100-8 (Permits for Part 70 Sources) [Applicable] Part 5 includes the general administrative requirements for part 70 permits. Any planned changes in the operation of the facility which result in emissions not authorized in the permit and which exceed the “Insignificant Activities” or “Trivial Activities” thresholds require prior notification to AQD and may require a permit modification. Insignificant activities mean individual emission units that either are on the list in Appendix I (OAC 252:100) or whose actual calendar year emissions do not exceed the following limits:

 5 TPY of any one criteria pollutant  2 TPY of any one hazardous air pollutant (HAP) or 5 TPY of multiple HAPs or 20% of any threshold less than 10 TPY for a HAP that the EPA may establish by rule

Emission limits for the facility are based on information in the permit application and Permit No. 97-227-C.

OAC 252:100-9 (Excess Emission Reporting Requirements) [Applicable] In the event of any release which results in excess emissions, the owner or operator of such facility shall notify the Air Quality Division as soon as the owner or operator of the facility has knowledge of such emissions, but no later than 4:30 p.m. the next working day following the malfunction or release. Within ten (10) working days after the immediate notice is given, the owner operator shall submit a written report describing the extent of the excess emissions and response actions taken by the facility. Part 70/Title V sources must report any exceedance that poses an imminent and substantial danger to public health, safety, or the environment as soon as is practicable. Under no circumstances shall notification be more than 24 hours after the exceedance.

OAC 252:100-13 (Prohibition of Open Burning) [Applicable] PERMIT MEMORANDUM 97-227-TV DRAFT Page 14

Open burning of refuse and other combustible material is prohibited except as authorized in the specific examples and under the conditions listed in this subchapter.

OAC 252:100-19 (Particulate Matter) [Applicable] This subchapter specifies a particulate matter (PM) emissions limitation of 0.6 lb/MMBTU from fuel-burning equipment with a rated heat input of 10 MMBTUH or less and fuel burning equipment larger than 10 MMBTUH but less than 100 MMBTUH to 0.35 lb/MMBTU. The heaters and boilers at the Velma Plant burn pipeline quality natural gas. Based on AP-42 and engineering judgment, PM-10 emissions from combustion of sweet natural gas are negligible. The facility is in compliance with this requirement based on the nature of the equipment and process. The permit requires the use of natural gas for all fuel-burning units to ensure compliance with Subchapter 19. This subchapter also limits emissions of PM from industrial processes. Per AP-42 factors, there are no significant PM emissions from any industrial activities at this facility.

OAC 252:100-25 (Visible Emissions and Particulates) [Applicable] No discharge of greater than 20% opacity is allowed except for short-term occurrences that consist of not more than one six-minute period in any consecutive 60 minutes, not to exceed three such periods in any consecutive 24 hours. In no case shall the average of any six-minute period exceed 60% opacity. When burning natural gas there is little possibility of exceeding the opacity standards.

OAC 252:100-29 (Fugitive Dust) [Applicable] No person shall cause or permit the discharge of any visible fugitive dust emissions beyond the property line on which the emissions originate in such a manner as to damage or to interfere with the use of adjacent properties, or cause air quality standards to be exceeded, or interfere with the maintenance of air quality standards. The facility does not handle, store, or process aggregate material and would not likely generate significant amounts of fugitive dust, thus it is not necessary to require specific precautions to be taken.

OAC 252:100-31 (Sulfur Compounds) [Applicable] Part 2 lists a maximum ambient air concentration limit of 1,200 ug/m3 (one hour average). Emissions from the Acid Gas Flare (AGF) are subject to “Existing Equipment Standards” of this subchapter. The acid gas compressor and the AGF cannot operate simultaneously. When the acid gas compressor is not operating due to process upsets, maintenance, etc., the acid gas is combusted in the acid gas flare. Pursuant to the requirements of OAC 252:100-31-7(a), emissions of SO2 from the acid gas flare (EUG S) cannot result in an exceedance of the ambient concentrations limits.

Ambient modeling of SO2 concentrations was conducted using the EPA-approved ISCST3 dispersion computer model. Modeling analysis in Table 20 shows the compliance of SO2 with the state ambient standards, which is achieved with an emission rate of 162 lb/hr from the acid gas flare. However, this requires the use of a sulfur recovery unit (SRU) prior to release of the exhaust gas to the atmosphere. Instead, the gas processing plant could emit 100 lb/hr or less of sulfur oxides expressed as sulfur dioxide, two-hour average, without use of any SRU. This requirement can also be met alternatively by establishing that the sulfur content of the acid gas stream from any gas sweetening plant or refinery process is 0.54 LT/D or less. PERMIT MEMORANDUM 97-227-TV DRAFT Page 15

Table 20 Comparison of Maximum Modeled SO2 Concentration with State Existing Equipment Standards Emission Maximum Modeled State Existing a Averaging Rate SO2 Concentration Equipment Source Period (lb/hr) (ug/m3) Standard (ug/m3) 5-Minute 162 725.9b 1300 1-Hour 162 725.9 1200 Acid Gas Flare 3-Hour 162 389.4 650 24-Hour 162 129.3 130 Annual 162 8.2 80 a The modeled calculated emission rate is 162 lb/hr; however, emission rate without a SRU is limited to 100 lb/hr. b5-minute concentration is based upon the 1-hour concentration

These modeling results predict ambient SO2 concentrations that are lower than the standard for all averaging times, based on the maximum modeled SO2 concentration.

OAC 252:100-33 (Nitrogen Oxides) [Not Applicable] This subchapter limits NOx emissions from new fuel-burning equipment with rated heat input greater than or equal to 50 MMBTUH to emissions of 0.2 lb of NOx per MMBTU. There are no equipment items that exceed the 50 MMBTUH threshold.

OAC 252:100-35 (Carbon Monoxide) [Not Applicable] None of the following affected processes are located at this facility: gray iron cupola, blast furnace, basic oxygen furnace, petroleum catalytic cracking unit, or petroleum catalytic reforming unit.

OAC 252:100-37 (Organic Materials) [Applicable] Part 3 requires storage tanks constructed after December 28, 1974, with a capacity of 400 gallons or more and storing a VOC with a vapor pressure greater than 1.5 psia at maximum storage temperature to be equipped with a permanent submerged fill pipe or with an organic vapor recovery system. The VOL storage tanks subject to this part are operated with submerged fill pipe or bottom fill pipe. Part 3 requires VOC loading facilities with a throughput equal to or less than 40,000 gallons per day to be equipped with a system for submerged filling of tank trucks or trailers if the capacity of the vehicle is greater than 200 gallons. The tank truck loading is subject to this requirement, and shall be equipped with a system for submerged filling. Part 5 limits the VOC content of coatings from any coating line or other coating operation. This facility does not normally conduct coating or painting operations except for routine maintenance of the facility and equipment which is exempt. Part 7 requires fuel-burning and refuse-burning equipment to be operated to minimize emissions of VOC. Temperature and available air must be sufficient to provide essentially complete combustion. Part 7 requires all effluent water separator openings, which receive water containing more than 200 gallons per day of any VOC, to be sealed or the separator to be equipped with an external floating roof or a fixed roof with an internal floating roof or a vapor recovery system. There is an effluent water separator, EUG 10 (OWS-2), at this facility with a flow rate below the 200 gallon/day threshold. Therefore, this part is not applicable to the unit. PERMIT MEMORANDUM 97-227-TV DRAFT Page 16

Part 7 also requires all reciprocating pumps and compressors handling VOCs to be equipped with packing glands and rotating pumps and compressors handling VOCs to be equipped with mechanical seals. All of the pumps at this facility are subject to these requirements.

OAC 252:100-41 (Hazardous Air Pollutants and Toxic Air Contaminants) [Applicable] Part 3 addresses hazardous air contaminants. NESHAP, as found in 40 CFR Part 61, are adopted by reference as they exist on September 1, 2004, with the exception of Subparts B, H, I, K, Q, R, T, W and Appendices D and E, all of which address radionuclides. In addition, General Provisions as found in 40 CFR Part 63, Subpart A, and the Maximum Achievable Control Technology (MACT) standards as found in 40 CFR Part 63, Subparts F, G, H, I, J, L, M, N, O, Q, R, S, T, U, W, X, Y, AA, BB, CC, DD, EE, GG, HH, II, JJ, KK, LL, MM, OO, PP, QQ, RR, SS, TT, UU, VV, WW, XX, YY, CCC, DDD, EEE, GGG, HHH, III, JJJ, LLL, MMM, NNN, OOO, PPP, QQQ, RRR, TTT, UUU, VVV, XXX, AAAA, CCCC, DDDD, EEEE, FFFF, GGGG, HHHH, IIII, JJJJ, KKKK, MMMM, NNNN, OOOO, PPPP, QQQQ, RRRR, SSSS, TTTT, UUUU, VVVV, WWWW, XXXX, YYYY, ZZZZ, AAAAA, BBBBB, CCCCC, EEEEE, FFFFF, GGGGG, HHHHH, IIIII, JJJJJ, KKKKK, LLLLL, MMMMM, NNNNN, PPPPP, QQQQQ, RRRRR, SSSSS and TTTTT are hereby adopted by reference as they exist on September 1, 2004. These standards apply to both existing and new sources of HAPs. These requirements are covered in the “Federal Regulations” section. Part 5 is a state-only requirement governing toxic air contaminants. Part 5 regulates sources of toxic air contaminants that have emissions exceeding a de minimis level. However, Part 5 of Subchapter 41 has been superseded by OAC 252:100-42. The Air Quality Council approved Subchapter 42 for permanent rulemaking on April 20, 2005. The Environmental Quality Board approved Subchapter 42 as both a permanent and emergency rule on June 21, 2005. The emergency Subchapter 42 was sent for Gubernatorial signature on June 30, 2005, and became effective by emergency August 11, 2005. Subchapter 42 is expected to become permanently effective on June 15, 2006. Because Subchapter 41, Part 5 has been superseded, the requirements of Part 5 will not be reviewed in this memorandum. Should Subchapter 42 fail to take effect, this permit will be reopened to address the requirements of Subchapter 41, Part 5.

OAC 252:100-42 (Toxic Air Contaminants (TAC)) [Applicable] All parts of OAC 252:100-41, with the exception of Part 3, shall be superseded by this subchapter. Any work practice, material substitution, or control equipment required by the Department prior to June 11, 2004, to control a TAC, shall be retained, unless a modification is approved by the Director.

OAC 252:100-43 (Testing, Monitoring, and Recordkeeping) [Applicable] This subchapter provides general requirements for testing, monitoring and recordkeeping and applies to any testing, monitoring or recordkeeping activity conducted at any stationary source. To determine compliance with emissions limitations or standards, the Air Quality Director may require the owner or operator of any source in the state of Oklahoma to install, maintain and operate monitoring equipment or to conduct tests, including stack tests, of the air contaminant source. All required testing must be conducted by methods approved by the Air Quality Director and under the direction of qualified personnel. A notice-of-intent to test and a testing protocol shall be submitted to Air Quality at least 30 days prior to the test date. Emissions and other data required to demonstrate compliance with any federal or state emission limit or standard, or any requirement set forth in a valid permit shall be recorded, maintained, and submitted as required PERMIT MEMORANDUM 97-227-TV DRAFT Page 17

by this subchapter, an applicable rule, or permit requirement. Data from any required testing or monitoring not conducted in accordance with the provisions of this subchapter shall be considered invalid. Nothing shall preclude the use, including the exclusive use, of any credible evidence or information relevant to whether a source would have been in compliance with applicable requirements if the appropriate performance or compliance test or procedure had been performed.

The following Oklahoma Air Quality Rules are not applicable to this facility OAC 252:100-11 Alternative Emissions Reduction not requested OAC 252:100-15 Mobile Sources not in source category OAC 252:100-17 Incinerators not type of emission unit OAC 252:100-23 Cotton Gins not type of emission unit OAC 252:100-24 Grain Elevators not in source category OAC 252:100-39 Nonattainment Areas not in area category OAC 252:100-47 Municipal Solid Waste Landfills not in source category

SECTION VI. FEDERAL REGULATIONS

PSD, 40 CFR Part 52 [Not Applicable] Atlas Pipeline Mid-Continent, L.L.C.’s current operation is an existing major source. PSD affects new major stationary sources and major modifications to existing stationary sources. Any future increases of emissions must be evaluated for PSD if they exceed a significance level (100 TPY CO, 40 TPY NOX, 40 TPY SO2, 40 TPY VOC, 25 TPY PM, 15 TPY PM10, 0.6 TPY Lead).

NSPS, 40 CFR Part 60 [Applicable] Subpart A, 60.18, General Control Device Requirement, January 21, 1986. The acid gas flare and the main flare are not subject to this requirement because these flares are not used to comply with an applicable subpart under Part 60. The flares are only used in emergency/upset situations and not during normal operation.

Subpart Dc, Small Steam Generating Unit. Hot Oil Process Heater #1 was constructed pre-1970; 8 MMBTU capacity. The burners were replaced in 1987. The recommended capacity remained at 8 MMBTU. The applicability date for Subpart Dc is June 9, 1989. This unit is below 10 MMBTU, and was modified prior to the effective date. Therefore, this subpart is not applicable to this unit.

Amine Unit Reboiler (Regeneration) Heater was installed in 1991. Although it was constructed after June 9, 1989 and it has a rated heat input capacity greater than 10 MMBTUH; this unit does not meet the definition of steam generating unit (60.41c). This term does not include process heaters as defined in this subpart and, therefore, is not applicable.

Subparts K, Ka, Kb, VOL Storage Vessels. The gasoline tanks were built before the effective date of this subpart. The condensate tanks (T- 1, T-2, T-9 and T-10) are above the de minimis of 19,813-gallons for Subpart Kb. Condensate tanks (T-1, T-2, T-9 and T-10) are, therefore, subject to this subpart. Oil Water Separator PERMIT MEMORANDUM 97-227-TV DRAFT Page 18

(OWS-2) stores hydrocarbons collected prior to the custody transfer. As defined by Subpart Kb, they are exempt from this subpart. Subpart GG, Stationary Gas Turbines. There are no turbines at this facility. Subpart VV, Equipment Leaks of VOC in the Synthetic Organic Chemicals Manufacturing Industry. This facility is not a SOCMI plant. Subpart KKK, Equipment Leaks of VOC from Onshore Natural Gas Processing Plants. This subpart applies to onshore natural gas processing plants that commence construction or modification after January 20, 1984, and include: a compressor station, dehydration unit, field gas gathering system, or liquefied natural gas unit. "Natural gas processing plant" is defined as any site engaged in the extraction of natural gas liquids from field gas, fractionation of natural gas liquids, or both. The amine unit was installed in 1967 and subsequently reconstructed in 1991. This subpart is, therefore, applicable to the amine sweetening unit of the facility and requirements will be stated in the permit. The fugitives added in the 2003 Electrification Project and the August 2004 Electric Compressor Project are also subject to this subpart. Subpart LLL, Onshore Natural Gas Processing: SO2 Emissions. This subpart sets standards for natural gas sweetening units. There is a sour gas injection well for H2S disposal at this facility. There are no sulfur compounds released to the atmosphere from this unit. Therefore, this subpart does not apply to this unit. However, an emergency provision is kept at the facility to flare the sour gas at a maximum rate of 100 lb/hr or less of sulfur oxides expressed as sulfur dioxide, two- hour average, without use of any SRU.

NESHAP, 40 CFR Part 61 [Not Applicable] There are no emissions of any of the regulated pollutants: arsenic, asbestos, beryllium, benzene, coke oven emissions, mercury, radionuclides or vinyl chloride except for trace amounts of benzene. Subpart J, Equipment Leaks of Benzene, only applies to process streams which contain more than 10% benzene by weight. Analysis of Oklahoma natural gas indicates a maximum benzene content of less than 1%.

NESHAP, 40 CFR Part 63 [Subpart HH is Applicable] Subpart HH, Oil and Natural Gas Production Facilities. This subpart applies to affected emission points that are located at facilities which are major sources of HAPs and either process, upgrade, or store hydrocarbons prior to the point of custody transfer or prior to which the natural gas enters the natural gas transmission and storage source category. For purposes of this subpart natural gas enters the natural gas transmission and storage source category after the natural gas processing plant. If no natural gas plant is present, natural gas enters the natural gas transmission and storage source category after the point of custody transfer. This facility is not a major source of HAPs, but subject to this subpart because of EPA policy of “once in, always in”. This facility, therefore, requires compliance with all applicable requirements of this subpart. Subpart HHH affects Natural Gas Transmission and Storage Facilities. Since this facility is a production facility, this subpart does not apply.

CAM, 40 CFR Part 64 [Not Applicable] Compliance Assurance Monitoring (CAM) published in the Federal Register on October 22, 1997, applies to any pollutant specific emission unit at a major source, that is required to obtain a Title V permit, if it meets all of the following criteria:

 It is subject to an emission limit or standard for an applicable regulated air pollutant PERMIT MEMORANDUM 97-227-TV DRAFT Page 19

 It uses a control device to achieve compliance with the applicable emission limit or standard  It has potential emissions, prior to the control device, of the applicable regulated air pollutant greater than major source thresholds

The amine unit uses an acid gas compressor to send acid gas to an injection well; therefore, is not subject to this requirement.

Accidental Release Prevention, 40 CFR Part 68 [Not Applicable] This facility handles naturally occurring hydrocarbon mixtures at a natural gas processing plant and the Accidental Release Prevention Provisions are applicable to this facility. The facility was required to submit the appropriate accidental release emergency response program plan prior to June 21, 1999. Atlas Pipeline Mid-Continent, L.L.C.. has submitted their plan which was given EPA Facility No. 1000 0002 7979. More information on this federal program is available on the web page: www.epa.gov/ceppo.

Stratospheric Ozone Protection, 40 CFR Part 82 [Subpart A and F Applicable] These standards require phase out of Class I & II substances, reductions of emissions of Class I & II substances to the lowest achievable level in all use sectors, and banning use of nonessential products containing ozone-depleting substances (Subparts A & C); control servicing of motor vehicle air conditioners (Subpart B); require Federal agencies to adopt procurement regulations which meet phase out requirements and which maximize the substitution of safe alternatives to Class I and Class II substances (Subpart D); require warning labels on products made with or containing Class I or II substances (Subpart E); maximize the use of recycling and recovery upon disposal (Subpart F); require producers to identify substitutes for ozone-depleting compounds under the Significant New Alternatives Program (Subpart G); and reduce the emissions of halons (Subpart H). Subpart A identifies ozone-depleting substances and divides them into two classes. Class I controlled substances are divided into seven groups; the chemicals typically used by the manufacturing industry include carbon tetrachloride (Class I, Group IV) and methyl chloroform (Class I, Group V). A complete phase-out of production of Class I substances is required by January 1, 2000 (January 1, 2002, for methyl chloroform). Class II chemicals, which are hydro- chlorofluorocarbons (HCFCs), are generally seen as interim substitutes for Class I CFCs. Class II substances consist of 33 HCFCs. A complete phase-out of Class II substances, scheduled in phases starting by 2002, is required by January 1, 2030. Subpart F requires that any persons servicing, maintaining, or repairing appliances except for motor vehicle air conditioners; persons disposing of appliances, including motor vehicle air conditioners; refrigerant reclaimers, appliance owners, and manufacturers of appliances and recycling and recovery equipment comply with the standards for recycling and emissions reduction. This facility does not utilize any Class I & II substances.

SECTION VII. INSPECTION AND COMPLIANCE DEMONSTRATION

Inspection An initial compliance inspection was conducted on February 27, 2002 at the Velma gas plant. Present for the inspection were Renée Parsons, Manager of Environmental Health and Safety (EH&S), Bud Porter, Coordinator of EH&S, David Hardin, Process Supervisor, and Jim Shaw, PERMIT MEMORANDUM 97-227-TV DRAFT Page 20

Compression Analyst of Spectrum Field Services, and Iftekhar Hossain and Mark Chen of Air Quality Division. The facility was operating as described in the permit application and supplemental materials. It was confirmed that the VOL storage tanks are operated with submerged fill pipe, and no visible emissions were observed from engine stacks and flares during the inspection. Periodic engine testing records and other required records are maintained at the Velma site. Identification plate and serial numbers are there on each engine. Insignificant activities were confirmed.

Follow-up Inspection A follow-up inspection was conducted on February 24, 2006, by Iftekhar Hossain and Kha Mach of Air Quality Division. The inspection was accompanied by Mr. James Branscum, Eastern Area Manager and Adam McGhee, Environment Health, and Safety Specialist, of Atlas Pipeline Mid-Continent LLC. The facility was as described in the permit application and supplemental information. All 36 gas-fired IC engines are replaced by 7 compressors powered by electric motors. Identification plates with unique serial numbers were attached to each heater and boiler. O&M reports and are maintained on-site.

Tier Classification and Public Review This application has been determined to be a Tier II based on the request for an operating permit for a major source for which a Title V operating permit is required. The permittee has submitted an affidavit that they are not seeking a permit for land use or for any operation upon land owned by others without their knowledge. The affidavit certifies that the application only involves land owned by the applicant or the applicants business.

In accordance with Tier II procedures, a legal notice of the filing of the operating permit application was published in the Duncan Banner on March 9, 1997, and was available for public review at the Velma Town Hall. No comments or inquiries were received at AQD. This facility is located within 50 miles of the Oklahoma - Texas border. Notice will be provided to the State of Texas of the draft permit. A draft of this permit will be made available for public review for a period of 30 days as stated in another newspaper announcement and is available for review on the Air Quality section of the DEQ web page at http://www.deq.state.ok.us.

Fees Paid Initial Title V operating permit fee of $2,000.

SECTION VIII. SUMMARY The facility was constructed and operated as described in the permit application and supplemental information. Ambient air quality standards are not threatened at this site. There are no an active Air Quality Compliance or Enforcement issues for this facility. Issuance of the permit is recommended, contingent on public and EPA review. DRAFT

PERMIT TO OPERATE AIR POLLUTION CONTROL FACILITY SPECIFIC CONDITIONS

Velma Gas plant Atlas Pipeline Mid-Continent, L.L.C. Permit No. 97-227-TV

The permittee is authorized to operate in conformity with the specifications submitted to Air Quality on January 15, 1997, with supplemental information received January 24, 1997, March 11, 1997, March 14, 2001, November 28, 2001, March 5, 2002, November 8, 2002, December 6, 2002, June 16, 2003, March 15, 2004, October 17, 2005, and March 22, 2006. The Evaluation Memorandum dated May 4, 2006, explains the derivation of applicable permit requirements and estimates of emissions; however, it does not contain operating limitations or permit requirements. Continuing operations under this permit constitutes acceptance of, and consent to, the conditions contained herein.

1. Points of emissions and emissions limitations for each point: [OAC 252:100-8-6 (a)]

EUG 1 - Natural Gas Fired Heaters and Boilers: The natural gas fired heaters and boilers are “grandfathered” (constructed prior to any applicable rule) units. There are no hourly or annual limits applied to these units under Title V, but they are limited to the existing equipment as they are.

Capacity Install/ Modify EU Point Equipment Serial # (MMBTU) Date H-1 P-35 Born - Hot Oil Process Heater 8.0 363 1947/87-Rerate B-1 P-38 Plant Boiler 6.7 8083 1977

EUG 2 - Gas Sweetening NO CO VOC SO EU# Emission Units X 2 lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY AGF Acid Gas Flare -- 2.20 -- 11.7 -- -- 100 220 MEF Main Plant Emergency Flare 1.40 6.13 7.40 32.41 3.00 13.14 100

The acid gas from the amine system shall be compressed and then sent to the injection well for disposal, except during the upset conditions of the disposal system.

EUG 3 - Amine Reboiler:

Emission NOx CO VOC PM SO2 EU# Units lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY Amine H-101 1.65 7.23 1.39 6.07 0.09 0.40 0.13 0.65 0.01 0.04 Reboiler SPECIFIC CONDITIONS 97-227-TV DRAFT Page 2

EUG 3B – Regeneration Glycol Dehydration Unit Reboiler NOx CO VOC PM SO EU# Emission Units 2 lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY Glycol Dehydration GD 0.15 0.64 0.12 0.54 0.01 0.04 0.01 0.05 0.01 0.01 Reboiler

EUG 4, EUG 5, and EUG 6 – Tanks: Storage tank VOC emissions are estimated based on existing equipment items, and the emissions are insignificant.

EUG 4– Tanks Capacity Throughput Installed EU Point Contents (bbl.) (bbl.) Date T-1 P-45 Scrubber Oil 500 10,312 8/1979 EUG 5 – Tanks T-2 P-46 Scrubber Oil 500 10,312 1/1996 EUG 6 – Tanks T-4* P-57 Condensate 400 48,880 1999 T-5* P-58 Condensate 400 48,880 1999 T-6 P-59 VOC/Water 390 71332 1999 T-7 P-60 VOC/Water 390 71332 1999 T-8* P-61 Produced Water/Condensate 390 26368 1996 T-9* P-62 Condensate 714 18250 2004 T-10* P-63 Condensate 714 4563 2004 * These tanks shall be controlled by a vapor recovery system that eliminates emissions by rerouting them into the plant inlet.

EUG 7 - Oil/Water Separator: Emissions from the oil/water separator are estimated based on existing equipment item and is considered insignificant activities. The effluent water separator openings shall not receive water containing more than 200 gallons per day of any VOC.

EU# Emission Unit OWS-2 Gun barrel oil-water separator #2

EUG 8 - VOC Leaking Components – Fugitive Sources: Fugitive VOC emissions are estimated based on existing equipment, but do not have a specific limitation and are insignificant.

EU ID# Source Description Number of Units Valves 2795 Connectors / Flanges 2436 Pump Seals 28 Fugitives (FUG) Pressure Relief Valves 33 Compressors 10 Others 3 SPECIFIC CONDITIONS 97-227-TV DRAFT Page 3

EUG 9 - Truck Loading: The fugitive VOC emissions from tank truck loading are limited as follows:

Throughput VOC Emissions Emission Unit bbl/month gallon/yr lb/hr TPY Tank Truck Loading (Condensate and Natural 10,000 5,040,000 92.47 135.00 Gas Liquids) Tank Truck Loading (Crude Oil) 10,000 5,040,000 0.68 1.00

2. The fuel-burning equipment shall use pipeline-grade natural gas or field gas with a maximum sulfur content of 343 ppmv. [OAC 252:100-31]

3. The permittee shall be authorized to operate this facility continuously (24 hours per day, every day of the year). [OAC 252:100-8-6 (a)]

4. Each engine at the facility shall have a permanent identification plate attached which shows the make, model number, and serial number. [OAC 252:100-45]

5. The permittee is authorized to operate the acid gas flare or the emergency flare during periods of acid gas compressor downtime.

(a) The SO2 emission rate for the acid gas flare or main plant emergency flare shall not exceed 100 lb/hr; (b) In no case shall the total SO2 emissions exceed 220 TPY; (c) Emissions of SO2 from the acid gas flare or the emergency flare above the limits in (a) or (b) shall be reported per OAC 252:100-9.

6. The following are the other insignificant and trivial activities.

EU# Emission Unit I T Records kept Plant #1 Cryogenic Skid I Run time West Plant (DOT) Emergency Flare I Flow volume FW-1 Waukesha F817 GU (Fire Water) T N/A FW-2 Caterpillar 3208 DIT (Fire Water) T N/A Jim's Tank Used Lube Oil T N/A Water Tank #1 Produced Water Tank I Sales tickets Amine Contactor MEA Regenerator I Downtime records Maintenance/blow downs Compressors Blow down Emissions I records Regen Heater 4.2 MMBtu Regeneration Heater I Annual emissions *I – Insignificant **T – Trivial

7. The following records shall be maintained on-site to verify Insignificant Activities. No recordkeeping is required for those operations which qualify as Trivial Activities. [OAC 252:100-8-6 (a)(3)(B)] SPECIFIC CONDITIONS 97-227-TV DRAFT Page 4

(a) For stationary reciprocating engines used exclusively for emergency power generation or for peaking power service: records of the size of engines, type of fuel used, and number of hours operated (annual). (b) For crude oil and condensate storage tanks with a capacity of less than or equal to 420,000 gallons that store crude oil and condensate prior to custody transfer: records of capacity of the tanks and the amount of throughput (annual). (c) For fluid storage tanks with a capacity of less than 39,894 gallons and a true vapor pressure less than 1.5 psia: records of capacity of the tanks and contents. (d) For activities that have the potential to emit less than 5 TPY (actual) of any criteria pollutant: the type of activity and the amount of emissions from that activity (cumulative annual). (e) Hours of operation of the West Plant (DOT) Emergency Flare. (f)Vapor pressures and capacities of all storage tanks with less than or equal to 10,000 gallons capacity that store volatile organic liquids with a true vapor pressure less than or equal to 1.0 psia at maximum storage temperature.

8. The permittee shall comply with the Standards of Performance for Equipment Leaks of VOC from Onshore Natural Gas Processing Plants NSPS Subpart KKK, for each affected facility located on-site, specifically equipment in VOC service in the amine sweetening unit, as per 40 CFR 60.630 to 60.636 including:

(a) The owner/operator shall comply with the requirements of §60.482-1(a), (b), and (d) and §60.482-2 through §60.482-10 except as provided in §60.333. [§60.632(a)]

(1) The owner/operator shall demonstrate compliance with § 60.482-1 to 60.482-10 for all affected equipment within 180 days of initial startup which shall be determined by review of records, reports, performance test results, and inspection using methods and procedures specified in § 60.485 unless the equipment is in vacuum service and is identified as required by § 60.486(e)(5). [§60.482-1(a), (b), & (d)] (2) The owner/operator shall comply with the monitoring, inspection, and repair requirements, for pumps in light liquid service, of §60.482-2(a), (b), and (c) except as provided in §60.482-2(d), (e), (f), and 60.633(d). (3) Information and data used to demonstrate that a reciprocating compressor is in wet gas service or is not in VOC service shall be recorded in a log that is kept in a readily accessible location. [§§60.633(f), 60.635(c), & 60.486(j)] (4) The owner/operator shall comply with the operation and monitoring requirements, for pressure relief devices in gas/vapor service, of §60.482-4(a) and (b) except as provided in §60-482-4(c) and §60.633(b). (5) Sampling and connection systems are exempt from the requirements of §60.482-5. [§60.633(c)] (6) Each open-ended valve or line shall be equipped with a cap, blind flange, plug, or a second valve, except as provided in §60.632(c). The cap, blind flange, plug, or second valve shall seal the open end at all times except during operations requiring process fluid flow through the open-ended valve or line. Each open- ended valve or line equipped with a second valve shall be operated in a manner SPECIFIC CONDITIONS 97-227-TV DRAFT Page 5

such that the valve on the process fluid end is closed before the second valve is closed. When a double block-and-bleed system is being used, the bleed valve or line may remain open during operations that require venting the line between the block valves but shall be closed at all other times. [§60.482-6] (7) The owner/operator shall comply with the monitoring, inspection, and repair requirements, for valves in gas/vapor service and light liquid service, of §60.482- 7(b) through (e), except as provided in §60.633(d), 60.482-7(f), (g), and (h), §60.483-1, 60.483-2, and 60.482-1(c). [§60.482-7(a)] (8) The owner/operator shall comply with the monitoring and repair requirements, for pumps and valves in heavy liquid service, pressure relief devices in light liquid or heavy liquid service, and flanges and other connectors, of §60.482-8(a) through (d). [§60.482-8] (9) Delay of repair of equipment is allowed if it meets one of the requirements of §60.482-9(a) through (e). (10) The owner/operators using a closed vent system and control device to comply with these provisions shall comply with the design, operation, monitoring and other requirements of §60.482-10(b) through (g). [§60.482-10(a)]

(b) An owner/operator may elect to comply with the alternative requirements for valves of §60.483-1 and 60.483-2. [§60.632(b) & 60.482-1(b)]

(c) An owner/operator may apply to the Administrator for permission to use an alternative means of emission limitation that achieves a reduction in emissions of VOC at least equivalent to that achieved by the controls required in NSPS Subpart KKK. In doing so, the owner or operator shall comply with requirements of §60.634. [§60.632(c)]

(d) The owner/operator shall comply with the test method and procedures of §60.485 except as provided in §60.632(f) and 60.633(h). [§60.632(d)]

(e) The owner/operator shall comply with the recordkeeping requirements of § 60.486 and the reporting requirements of §60.487 except as provided in §§60.633, 60.635, and 60.636. [§60.632(e)] (f) The owner/operator shall comply with the recordkeeping requirements of §60.635(b) and (c) in addition to the requirements of §60.486. [§60.635(a)] (g) The owner/operator shall comply with the reporting requirements of §60.636(b) and (c) in addition to the requirements of §60.487.

9. The 21,000 gallon scrubber oil tank (T-2) at the facility is subject to New Source Performance Standards (NSPS) 40 CFR 60 Subpart Kb. The owner or operator shall keep records for the life of the facility showing the dimension and capacity of the tanks. [40 CFR 60.110b to 60.116b]

10. The closed vent systems and control device to T-8 shall be designed to collect all VOC vapors and gases discharged from the storage vessel and operated with no detectable emissions as indicated by an instrument reading of less than 500 ppm above background and visual inspections, as determined in part 60, Subpart VV, §60.485(b). SPECIFIC CONDITIONS 97-227-TV DRAFT Page 6

[40 CFR 60.112b(a)(3)(i)]

11. Air emissions from the acid gas flare shall be discharged to at least 170’ above grade. The flare shall be operated at all times when the emissions may be vented to it.

12. The permittee shall maintain records of operations as listed below. These records shall be maintained on site or at a local field office for at least five years after the date of recording and shall be provided to regulatory personnel upon request. [OAC 252:100-8-6 (a)(3)(B)]

(a) Throughput of the Oil/Water Separator. (b) The loading rack throughputs. (c) Acid gas flare’s flow (daily). (d) The presence of a flare pilot flame using a thermocouple or any other equivalent device to detect the presence of a flame. (e) Testing of sulfur content, gas processing rates, and/or acid gas flow rates (weekly and cumulative annual).

SO2 emissions shall be calculated using the following equation:

SCFD * ppm sulfur * 64 SO2 emissions (lb/day) = ------380 * 1,000,000

(f) The amount of gas flared through acid gas flare or/and main emergency flare (daily and cumulative annual). (g) Analysis of inlet gas H2S content (annually and whenever supply changes). (h) Summary of O&M records for any engine not tested in each quarter. (i) Records required by 40 CFR Part 60, NSPS, Subparts Kb and KKK. (j) Records required by 40 CFR Part 63, NESHAP, Subpart HH. (k) Annual HAP emissions calculation.

13. No later than 30 days after each anniversary date of the issuance of this permit, the permittee shall submit to Air Quality Division of DEQ, with a copy to the US EPA, Region 6, a certification of compliance with the terms and conditions of this permit. The summary of all reporting and recordkeeping, as mentioned in Specific Condition #12, for the past year is required to be included. [OAC 252:100-8-6 (c)(5)(A) & (D)]

14. The facility is subject to 40 CFR Part 63, Subpart HH, and shall comply with all applicable requirements including but not limited to the following: [40 CFR 63.760 – 779] (a) 40 CFR 63.760: Applicability and designation of affected source (b) 40 CFR 63.761: Definitions (c) 40 CFR 63.762: Startup, shutdowns, and malfunctions (d) 40 CFR 63.764: General standards (e) 40 CFR 63.765: Glycol dehydration unit process vents standards (f) 40 CFR 63.766: Storage vessel standards (g) 40 CFR 63.769: Equipment leak standards SPECIFIC CONDITIONS 97-227-TV DRAFT Page 7

(h) 40 CFR 63.771: Control equipment requirements (i) 40 CFR 63.772: Test methods, compliance procedures, and compliance demonstrations (j) 40 CFR 63.773: Inspection and monitoring requirements (k) 40 CFR 63.774: Recordkeeping requirements (l) 40 CFR 63.775: Reporting requirements (m)40 CFR 63.776: Delegation of authority (n) 40 CFR 63.777: Alternate means of emission limitation

15. No later than 90 days of issuance of this permit, the permittee shall have conducted the following compliance measure to comply with 40 CFR Part 63, Subpart HH:

(a) The owner/operator shall have prepared a start-up, shutdown, and malfunction plan as required by 63.6(e)(3). (b) The owner/operator shall have identified all potential VHAP streams and affected equipment, tagged all equipment affected by NESHAP Subpart HH, and conducted initial monitoring required under 40 CFR Part 63, Subpart HH.

16. The Permit Shield (Standard Conditions, Section VI) is extended to the following requirements that have been determined to be inapplicable to this facility. [OAC 252:100-8-6(d)(2)] A. Oklahoma Air Quality Rules OAC 252:100-11 Alternative Emissions Reduction Plans and Authorizations OAC 252:100-15 Motor Vehicle Pollution Control Devices OAC 252:100-23 Control of Emissions from Cotton Gins OAC 252:100-24 Particulate Matter Emission from Grain Elevators, Feed or Seed Operations OAC 252:100-33 Control of Emission of Nitrogen Oxides OAC 252:100-35 Control of Emission of Carbon Monoxide OAC 252:100-39 Emission of Volatile Organic Compounds (VOCs) in Nonattainment and Former Nonattainment Areas

B. Federal Regulations NSPS, 40 CFR Part 60, Subpart Dc NSPS, 40 CFR Part 60, Subpart GG

17. This permit supersedes Permits No. 74-008-O, 76-070-O, 77-036-O, 77-047-O, 77-059-O, 78-004-O, 91-025-O, 97-227-C, which are now null and void. TITLE V (PART 70) PERMIT TO OPERATE / CONSTRUCT STANDARD CONDITIONS (July 1, 2005)

SECTION I. DUTY TO COMPLY

A. This is a permit to operate / construct this specific facility in accordance with Title V of the federal Clean Air Act (42 U.S.C. 7401, et seq.) and under the authority of the Oklahoma Clean Air Act and the rules promulgated there under. [Oklahoma Clean Air Act, 27A O.S. § 2-5-112]

B. The issuing Authority for the permit is the Air Quality Division (AQD) of the Oklahoma Department of Environmental Quality (DEQ). The permit does not relieve the holder of the obligation to comply with other applicable federal, state, or local statutes, regulations, rules, or ordinances. [Oklahoma Clean Air Act, 27A O.S. § 2-5-112]

C. The permittee shall comply with all conditions of this permit. Any permit noncompliance shall constitute a violation of the Oklahoma Clean Air Act and shall be grounds for enforcement action, for revocation of the approval to operate under the terms of this permit, or for denial of an application to renew this permit. All terms and conditions (excluding state-only requirements) are enforceable by the DEQ, by EPA, and by citizens under section 304 of the Clean Air Act. This permit is valid for operations only at the specific location listed. [40 CFR §70.6(b), OAC 252:100-8-1.3 and 8-6 (a)(7)(A) and (b)(1)]

D. It shall not be a defense for a permittee in an enforcement action that it would have been necessary to halt or reduce the permitted activity in order to maintain compliance with the conditions of the permit. [OAC 252:100-8-6 (a)(7)(B)]

SECTION II. REPORTING OF DEVIATIONS FROM PERMIT TERMS

A. Any exceedance resulting from emergency conditions and/or posing an imminent and substantial danger to public health, safety, or the environment shall be reported in accordance with Section XIV. [OAC 252:100-8-6 (a)(3)(C)(iii)]

B. Deviations that result in emissions exceeding those allowed in this permit shall be reported consistent with the requirements of OAC 252:100-9, Excess Emission Reporting Requirements. [OAC 252:100-8-6 (a)(3)(C)(iv)]

C. Oral notifications (fax is also acceptable) shall be made to the AQD central office as soon as the owner or operator of the facility has knowledge of such emissions but no later than 4:30 p.m. the next working day the permittee becomes aware of the exceedance. Within ten (10) working days after the immediate notice is given, the owner operator shall submit a written report describing the extent of the excess emissions and response actions taken by the facility. Every written report submitted under OAC 252:100-8-6 (a)(3)(C)(iii) shall be certified by a responsible official. [OAC 252:100-8-6 (a)(3)(C)(iii)] TITLE V (PART 70) PERMIT STANDARD CONDITIONS (July 1, 2005) Page 2

SECTION III. MONITORING, TESTING, RECORDKEEPING & REPORTING

A. The permittee shall keep records as specified in this permit. Unless a different retention period or retention conditions are set forth by a specific term in this permit, these records, including monitoring data and necessary support information, shall be retained on-site or at a nearby field office for a period of at least five years from the date of the monitoring sample, measurement, report, or application, and shall be made available for inspection by regulatory personnel upon request. Support information includes all original strip-chart recordings for continuous monitoring instrumentation, and copies of all reports required by this permit. Where appropriate, the permit may specify that records may be maintained in computerized form. [OAC 252:100-8-6 (a)(3)(B)(ii), 8-6 (c)(1), and 8-6 (c)(2)(B)]

B. Records of required monitoring shall include: (1) the date, place and time of sampling or measurement; (2) the date or dates analyses were performed; (3) the company or entity which performed the analyses; (4) the analytical techniques or methods used; (5) the results of such analyses; and (6) the operating conditions as existing at the time of sampling or measurement. [OAC 252:100-8-6 (a)(3)(B)(i)]

C. No later than 30 days after each six (6) month period, after the date of the issuance of the original Part 70 operating permit, the permittee shall submit to AQD a report of the results of any required monitoring. All instances of deviations from permit requirements since the previous report shall be clearly identified in the report. [OAC 252:100-8-6 (a)(3)(C)(i) and (ii)]

D. If any testing shows emissions in excess of limitations specified in this permit, the owner or operator shall comply with the provisions of Section II of these standard conditions. [OAC 252:100-8-6 (a)(3)(C)(iii)]

E. In addition to any monitoring, recordkeeping or reporting requirement specified in this permit, monitoring and reporting may be required under the provisions of OAC 252:100-43, Testing, Monitoring, and Recordkeeping, or as required by any provision of the Federal Clean Air Act or Oklahoma Clean Air Act.

F. Submission of quarterly or semi-annual reports required by any applicable requirement that are duplicative of the reporting required in the previous paragraph will satisfy the reporting requirements of the previous paragraph if noted on the submitted report.

G. Every report submitted under OAC 252:100-8-6 and OAC 252:100-43 shall be certified by a responsible official. [OAC 252:100-8-6 (a)(3)(C)(iv)]

H. Any owner or operator subject to the provisions of NSPS shall maintain records of the occurrence and duration of any start-up, shutdown, or malfunction in the operation of an affected facility or any malfunction of the air pollution control equipment. [40 CFR 60.7 (b)] I. Any owner or operator subject to the provisions of NSPS shall maintain a file of all measurements and other information required by the subpart recorded in a permanent file TITLE V (PART 70) PERMIT STANDARD CONDITIONS (July 1, 2005) Page 3 suitable for inspection. This file shall be retained for at least two years following the date of such measurements, maintenance, and records. [40 CFR 60.7 (d)]

J. The permittee of a facility that is operating subject to a schedule of compliance shall submit to the DEQ a progress report at least semi-annually. The progress reports shall contain dates for achieving the activities, milestones or compliance required in the schedule of compliance and the dates when such activities, milestones or compliance was achieved. The progress reports shall also contain an explanation of why any dates in the schedule of compliance were not or will not be met, and any preventative or corrective measures adopted. [OAC 252:100-8-6 (c)(4)]

K. All testing must be conducted by methods approved by the Division Director under the direction of qualified personnel. All tests shall be made and the results calculated in accordance with standard test procedures. The use of alternative test procedures must be approved by EPA. When a portable analyzer is used to measure emissions it shall be setup, calibrated, and operated in accordance with the manufacturer’s instructions and in accordance with a protocol meeting the requirements of the “AQD Portable Analyzer Guidance” document or an equivalent method approved by Air Quality. [40 CFR §70.6(a), 40 CFR §51.212(c)(2), 40 CFR § 70.7(d), 40 CFR §70.7(e)(2), OAC 252:100-8-6 (a)(3)(A)(iv), and OAC 252:100-43]

L. The permittee shall submit to the AQD a copy of all reports submitted to the EPA as required by 40 CFR Part 60, 61, and 63, for all equipment constructed or operated under this permit subject to such standards. [OAC 252:100-4-5 and OAC 252:100-41-15]

SECTION IV. COMPLIANCE CERTIFICATIONS

A. No later than 30 days after each anniversary date of the issuance of the original Part 70 operating permit, the permittee shall submit to the AQD, with a copy to the US EPA, Region 6, a certification of compliance with the terms and conditions of this permit and of any other applicable requirements which have become effective since the issuance of this permit. The compliance certification shall also include such other facts as the permitting authority may require to determine the compliance status of the source. [OAC 252:100-8-6 (c)(5)(A), (C)(v), and (D)]

B. The certification shall describe the operating permit term or condition that is the basis of the certification; the current compliance status; whether compliance was continuous or intermittent; the methods used for determining compliance, currently and over the reporting period; and a statement that the facility will continue to comply with all applicable requirements. [OAC 252:100-8-6 (c)(5)(C)(i)-(iv)]

C. Any document required to be submitted in accordance with this permit shall be certified as being true, accurate, and complete by a responsible official. This certification shall state that, based on information and belief formed after reasonable inquiry, the statements and information in the certification are true, accurate, and complete. [OAC 252:100-8-5 (f) and OAC 252:100-8-6 (c)(1)]

D. Any facility reporting noncompliance shall submit a schedule of compliance for emissions units or stationary sources that are not in compliance with all applicable requirements. This schedule shall include a schedule of remedial measures, including an enforceable sequence of TITLE V (PART 70) PERMIT STANDARD CONDITIONS (July 1, 2005) Page 4 actions with milestones, leading to compliance with any applicable requirements for which the emissions unit or stationary source is in noncompliance. This compliance schedule shall resemble and be at least as stringent as that contained in any judicial consent decree or administrative order to which the emissions unit or stationary source is subject. Any such schedule of compliance shall be supplemental to, and shall not sanction noncompliance with, the applicable requirements on which it is based, except that a compliance plan shall not be required for any noncompliance condition which is corrected within 24 hours of discovery. [OAC 252:100-8-5 (e)(8)(B) and OAC 252:100-8-6 (c)(3)]

SECTION V. REQUIREMENTS THAT BECOME APPLICABLE DURING THE PERMIT TERM

The permittee shall comply with any additional requirements that become effective during the permit term and that are applicable to the facility. Compliance with all new requirements shall be certified in the next annual certification. [OAC 252:100-8-6 (c)(6)]

SECTION VI. PERMIT SHIELD

A. Compliance with the terms and conditions of this permit (including terms and conditions established for alternate operating scenarios, emissions trading, and emissions averaging, but excluding terms and conditions for which the permit shield is expressly prohibited under OAC 252:100-8) shall be deemed compliance with the applicable requirements identified and included in this permit. [OAC 252:100-8-6 (d)(1)]

B. Those requirements that are applicable are listed in the Standard Conditions and the Specific Conditions of this permit. Those requirements that the applicant requested be determined as not applicable are summarized in the Specific Conditions of this permit. [OAC 252:100-8-6 (d)(2)]

SECTION VII. ANNUAL EMISSIONS INVENTORY & FEE PAYMENT

The permittee shall file with the AQD an annual emission inventory and shall pay annual fees based on emissions inventories. The methods used to calculate emissions for inventory purposes shall be based on the best available information accepted by AQD. [OAC 252:100-5-2.1, -5-2.2, and OAC 252:100-8-6 (a)(8)]

SECTION VIII. TERM OF PERMIT

A. Unless specified otherwise, the term of an operating permit shall be five years from the date of issuance. [OAC 252:100-8-6 (a)(2)(A)]

B. A source’s right to operate shall terminate upon the expiration of its permit unless a timely and complete renewal application has been submitted at least 180 days before the date of expiration. [OAC 252:100-8-7.1 (d)(1)]

C. A duly issued construction permit or authorization to construct or modify will terminate and become null and void (unless extended as provided in OAC 252:100-8-1.4(b)) if the construction is not commenced within 18 months after the date the permit or authorization was issued, or if work is suspended for more than 18 months after it is commenced. [OAC 252:100-8-1.4(a)] TITLE V (PART 70) PERMIT STANDARD CONDITIONS (July 1, 2005) Page 5

D. The recipient of a construction permit shall apply for a permit to operate (or modified operating permit) within 180 days following the first day of operation. [OAC 252:100-8-4(b)(5)]

SECTION IX. SEVERABILITY

The provisions of this permit are severable and if any provision of this permit, or the application of any provision of this permit to any circumstance, is held invalid, the application of such provision to other circumstances, and the remainder of this permit, shall not be affected thereby. [OAC 252:100-8-6 (a)(6)]

SECTION X. PROPERTY RIGHTS

A. This permit does not convey any property rights of any sort, or any exclusive privilege. [OAC 252:100-8-6 (a)(7)(D)]

B. This permit shall not be considered in any manner affecting the title of the premises upon which the equipment is located and does not release the permittee from any liability for damage to persons or property caused by or resulting from the maintenance or operation of the equipment for which the permit is issued. [OAC 252:100-8-6 (c)(6)]

SECTION XI. DUTY TO PROVIDE INFORMATION

A. The permittee shall furnish to the DEQ, upon receipt of a written request and within sixty (60) days of the request unless the DEQ specifies another time period, any information that the DEQ may request to determine whether cause exists for modifying, reopening, revoking, reissuing, terminating the permit or to determine compliance with the permit. Upon request, the permittee shall also furnish to the DEQ copies of records required to be kept by the permit. [OAC 252:100-8-6 (a)(7)(E)]

B. The permittee may make a claim of confidentiality for any information or records submitted pursuant to 27A O.S. 2-5-105(18). Confidential information shall be clearly labeled as such and shall be separable from the main body of the document such as in an attachment. [OAC 252:100-8-6 (a)(7)(E)]

C. Notification to the AQD of the sale or transfer of ownership of this facility is required and shall be made in writing within 10 days after such date. [Oklahoma Clean Air Act, 27A O.S. § 2-5-112 (G)] SECTION XII. REOPENING, MODIFICATION & REVOCATION

A. The permit may be modified, revoked, reopened and reissued, or terminated for cause. Except as provided for minor permit modifications, the filing of a request by the permittee for a permit modification, revocation, reissuance, termination, notification of planned changes, or anticipated noncompliance does not stay any permit condition. [OAC 252:100-8-6 (a)(7)(C) and OAC 252:100-8-7.2 (b)]

B. The DEQ will reopen and revise or revoke this permit as necessary to remedy deficiencies in the following circumstances: [OAC 252:100-8-7.3 and OAC 252:100-8-7.4(a)(2)] TITLE V (PART 70) PERMIT STANDARD CONDITIONS (July 1, 2005) Page 6

(1) Additional requirements under the Clean Air Act become applicable to a major source category three or more years prior to the expiration date of this permit. No such reopening is required if the effective date of the requirement is later than the expiration date of this permit. (2) The DEQ or the EPA determines that this permit contains a material mistake or that the permit must be revised or revoked to assure compliance with the applicable requirements. (3) The DEQ or the EPA determines that inaccurate information was used in establishing the emission standards, limitations, or other conditions of this permit. The DEQ may revoke and not reissue this permit if it determines that the permittee has submitted false or misleading information to the DEQ.

C. If “grandfathered” status is claimed and granted for any equipment covered by this permit, it shall only apply under the following circumstances: [OAC 252:100-5-1.1]

(1) It only applies to that specific item by serial number or some other permanent identification. (2) Grandfathered status is lost if the item is significantly modified or if it is relocated outside the boundaries of the facility.

D. To make changes other than (1) those described in Section XVIII (Operational Flexibility), (2) administrative permit amendments, and (3) those not defined as an Insignificant Activity (Section XVI) or Trivial Activity (Section XVII), the permittee shall notify AQD. Such changes may require a permit modification. [OAC 252:100-8-7.2 (b)]

E. Activities that will result in air emissions that exceed the trivial/insignificant levels and that are not specifically approved by this permit are prohibited. [OAC 252:100-8-6 (c)(6)]

SECTION XIII. INSPECTION & ENTRY

A. Upon presentation of credentials and other documents as may be required by law, the permittee shall allow authorized regulatory officials to perform the following (subject to the permittee's right to seek confidential treatment pursuant to 27A O.S. Supp. 1998, § 2-5-105(18) for confidential information submitted to or obtained by the DEQ under this section): [OAC 252:100-8-6 (c)(2)]

(1) enter upon the permittee's premises during reasonable/normal working hours where a source is located or emissions-related activity is conducted, or where records must be kept under the conditions of the permit; (2) have access to and copy, at reasonable times, any records that must be kept under the conditions of the permit; (3) inspect, at reasonable times and using reasonable safety practices, any facilities, equipment (including monitoring and air pollution control equipment), practices, or operations regulated or required under the permit; and (4) as authorized by the Oklahoma Clean Air Act, sample or monitor at reasonable times substances or parameters for the purpose of assuring compliance with the permit.

SECTION XIV. EMERGENCIES TITLE V (PART 70) PERMIT STANDARD CONDITIONS (July 1, 2005) Page 7

A. Any emergency and/or exceedance that poses an imminent and substantial danger to public health, safety, or the environment shall be reported to AQD as soon as is practicable; but under no circumstance shall notification be more than 24 hours after the exceedance. [OAC 252:100-8-6 (a)(3)(C)(iii)(II)]

B. An "emergency" means any situation arising from sudden and reasonably unforeseeable events beyond the control of the source, including acts of God, which situation requires immediate corrective action to restore normal operation, and that causes the source to exceed a technology-based emission limitation under this permit, due to unavoidable increases in emissions attributable to the emergency. [OAC 252:100-8-2]

C. An emergency shall constitute an affirmative defense to an action brought for noncompliance with such technology-based emission limitation if the conditions of paragraph D below are met. [OAC 252:100-8-6 (e)(1)]

D. The affirmative defense of emergency shall be demonstrated through properly signed, contemporaneous operating logs or other relevant evidence that: [OAC 252:100-8-6 (e)(2), (a)(3)(C)(iii)(I) and (IV)]

(1) an emergency occurred and the permittee can identify the cause or causes of the emergency; (2) the permitted facility was at the time being properly operated; (3) during the period of the emergency the permittee took all reasonable steps to minimize levels of emissions that exceeded the emission standards or other requirements in this permit; (4) the permittee submitted timely notice of the emergency to AQD, pursuant to the applicable regulations (i.e., for emergencies that pose an “imminent and substantial danger,” within 24 hours of the time when emission limitations were exceeded due to the emergency; 4:30 p.m. the next business day for all other emergency exceedances). See OAC 252:100-8-6(a)(3)(C)(iii)(I) and (II). This notice shall contain a description of the emergency, the probable cause of the exceedance, any steps taken to mitigate emissions, and corrective actions taken; and (5) the permittee submitted a follow up written report within 10 working days of first becoming aware of the exceedance.

E. In any enforcement proceeding, the permittee seeking to establish the occurrence of an emergency shall have the burden of proof. [OAC 252:100-8-6 (e)(3)]

SECTION XV. RISK MANAGEMENT PLAN

The permittee, if subject to the provision of Section 112(r) of the Clean Air Act, shall develop and register with the appropriate agency a risk management plan by June 20, 1999, or the applicable effective date. [OAC 252:100-8-6 (a)(4)]

SECTION XVI. INSIGNIFICANT ACTIVITIES TITLE V (PART 70) PERMIT STANDARD CONDITIONS (July 1, 2005) Page 8

Except as otherwise prohibited or limited by this permit, the permittee is hereby authorized to operate individual emissions units that are either on the list in Appendix I to OAC Title 252, Chapter 100, or whose actual calendar year emissions do not exceed any of the limits below. Any activity to which a State or federal applicable requirement applies is not insignificant even if it meets the criteria below or is included on the insignificant activities list. [OAC 252:100-8-2]

(1) 5 tons per year of any one criteria pollutant. (2) 2 tons per year for any one hazardous air pollutant (HAP) or 5 tons per year for an aggregate of two or more HAP's, or 20 percent of any threshold less than 10 tons per year for single HAP that the EPA may establish by rule.

SECTION XVII. TRIVIAL ACTIVITIES

Except as otherwise prohibited or limited by this permit, the permittee is hereby authorized to operate any individual or combination of air emissions units that are considered inconsequential and are on the list in Appendix J. Any activity to which a State or federal applicable requirement applies is not trivial even if included on the trivial activities list. [OAC 252:100-8-2]

SECTION XVIII. OPERATIONAL FLEXIBILITY

A. A facility may implement any operating scenario allowed for in its Part 70 permit without the need for any permit revision or any notification to the DEQ (unless specified otherwise in the permit). When an operating scenario is changed, the permittee shall record in a log at the facility the scenario under which it is operating. [OAC 252:100-8-6 (a)(10) and (f)(1)]

B. The permittee may make changes within the facility that:

(1) result in no net emissions increases, (2) are not modifications under any provision of Title I of the federal Clean Air Act, and (3) do not cause any hourly or annual permitted emission rate of any existing emissions unit to be exceeded; provided that the facility provides the EPA and the DEQ with written notification as required below in advance of the proposed changes, which shall be a minimum of 7 days, or 24 hours for emergencies as defined in OAC 252:100-8-6 (e). The permittee, the DEQ, and the EPA shall attach each such notice to their copy of the permit. For each such change, the written notification required above shall include a brief description of the change within the permitted facility, the date on which the change will occur, any change in emissions, and any permit term or condition that is no longer applicable as a result of the change. The permit shield provided by this permit does not apply to any change made pursuant to this subsection. [OAC 252:100-8-6 (f) (2)]

SECTION XIX. OTHER APPLICABLE & STATE-ONLY REQUIREMENTS

A. The following applicable requirements and state-only requirements apply to the facility unless elsewhere covered by a more restrictive requirement: TITLE V (PART 70) PERMIT STANDARD CONDITIONS (July 1, 2005) Page 9

(1) No person shall cause or permit the discharge of emissions such that National Ambient Air Quality Standards (NAAQS) are exceeded on land outside the permitted facility. [OAC 252:100-3] (2) Open burning of refuse and other combustible material is prohibited except as authorized in the specific examples and under the conditions listed in the Open Burning Subchapter. [OAC 252:100-13] (3) No particulate emissions from any fuel-burning equipment with a rated heat input of 10 MMBTUH or less shall exceed 0.6 lb/MMBTU. [OAC 252:100-19] (4) For all emissions units not subject to an opacity limit promulgated under 40 CFR, Part 60, NSPS, no discharge of greater than 20% opacity is allowed except for short-term occurrences which consist of not more than one six-minute period in any consecutive 60 minutes, not to exceed three such periods in any consecutive 24 hours. In no case shall the average of any six-minute period exceed 60% opacity. [OAC 252:100-25] (5) No visible fugitive dust emissions shall be discharged beyond the property line on which the emissions originate in such a manner as to damage or to interfere with the use of adjacent properties, or cause air quality standards to be exceeded, or interfere with the maintenance of air quality standards. [OAC 252:100-29] (6) No sulfur oxide emissions from new gas-fired fuel-burning equipment shall exceed 0.2 lb/MMBTU. No existing source shall exceed the listed ambient air standards for sulfur dioxide. [OAC 252:100-31] (7) Volatile Organic Compound (VOC) storage tanks built after December28, 1974, and with a capacity of 400 gallons or more storing a liquid with a vapor pressure of 1.5 psia or greater under actual conditions shall be equipped with a permanent submerged fill pipe or with a vapor-recovery system. [OAC 252:100-37-15(b)] (8) All fuel-burning equipment shall at all times be properly operated and maintained in a manner that will minimize emissions of VOCs. [OAC 252:100-37-36]

SECTION XX. STRATOSPHERIC OZONE PROTECTION

A. The permittee shall comply with the following standards for production and consumption of ozone-depleting substances. [40 CFR 82, Subpart A]

1. Persons producing, importing, or placing an order for production or importation of certain class I and class II substances, HCFC-22, or HCFC-141b shall be subject to the requirements of §82.4. 2. Producers, importers, exporters, purchasers, and persons who transform or destroy certain class I and class II substances, HCFC-22, or HCFC-141b are subject to the recordkeeping requirements at §82.13. 3. Class I substances (listed at Appendix A to Subpart A) include certain CFCs, Halons, HBFCs, carbon tetrachloride, trichloroethane (methyl chloroform), and bromomethane (Methyl Bromide). Class II substances (listed at Appendix B to Subpart A) include HCFCs.

B. If the permittee performs a service on motor (fleet) vehicles when this service involves an ozone-depleting substance refrigerant (or regulated substitute substance) in the motor vehicle air conditioner (MVAC), the permittee is subject to all applicable requirements. Note: The term “motor vehicle” as used in Subpart B does not include a vehicle in which final assembly of the vehicle has not been completed. The term “MVAC” as used in Subpart B does not include the TITLE V (PART 70) PERMIT STANDARD CONDITIONS (July 1, 2005) Page 10 air-tight sealed refrigeration system used as refrigerated cargo, or the system used on passenger buses using HCFC-22 refrigerant. [40 CFR 82, Subpart B]

C. The permittee shall comply with the following standards for recycling and emissions reduction except as provided for MVACs in Subpart B. [40 CFR 82, Subpart F]

(1) Persons opening appliances for maintenance, service, repair, or disposal must comply with the required practices pursuant to § 82.156. (2) Equipment used during the maintenance, service, repair, or disposal of appliances must comply with the standards for recycling and recovery equipment pursuant to § 82.158. (3) Persons performing maintenance, service, repair, or disposal of appliances must be certified by an approved technician certification program pursuant to § 82.161. (4) Persons disposing of small appliances, MVACs, and MVAC-like appliances must comply with record-keeping requirements pursuant to § 82.166. (5) Persons owning commercial or industrial process refrigeration equipment must comply with leak repair requirements pursuant to § 82.158. (6) Owners/operators of appliances normally containing 50 or more pounds of refrigerant must keep records of refrigerant purchased and added to such appliances pursuant to § 82.166.

SECTION XXI. TITLE V APPROVAL LANGUAGE

A. DEQ wishes to reduce the time and work associated with permit review and, wherever it is not inconsistent with Federal requirements, to provide for incorporation of requirements established through construction permitting into the Sources’ Title V permit without causing redundant review. Requirements from construction permits may be incorporated into the Title V permit through the administrative amendment process set forth in Oklahoma Administrative Code 252:100-8-7.2(a) only if the following procedures are followed:

(1) The construction permit goes out for a 30-day public notice and comment using the procedures set forth in 40 Code of Federal Regulations (CFR) § 70.7 (h)(1). This public notice shall include notice to the public that this permit is subject to Environmental Protection Agency (EPA) review, EPA objection, and petition to EPA, as provided by 40 CFR § 70.8; that the requirements of the construction permit will be incorporated into the Title V permit through the administrative amendment process; that the public will not receive another opportunity to provide comments when the requirements are incorporated into the Title V permit; and that EPA review, EPA objection, and petitions to EPA will not be available to the public when requirements from the construction permit are incorporated into the Title V permit. (2) A copy of the construction permit application is sent to EPA, as provided by 40 CFR § 70.8(a)(1). (3) A copy of the draft construction permit is sent to any affected State, as provided by 40 CFR § 70.8(b). (4) A copy of the proposed construction permit is sent to EPA for a 45-day review period as provided by 40 CFR § 70.8(a) and (c). (5) The DEQ complies with 40 CFR § 70.8 (c) upon the written receipt within the 45-day comment period of any EPA objection to the construction permit. The DEQ shall not issue the permit until EPA’s objections are resolved to the satisfaction of EPA. TITLE V (PART 70) PERMIT STANDARD CONDITIONS (July 1, 2005) Page 11

(6) The DEQ complies with 40 CFR § 70.8 (d). (7) A copy of the final construction permit is sent to EPA as provided by 40 CFR § 70.8 (a). (8) The DEQ shall not issue the proposed construction permit until any affected State and EPA have had an opportunity to review the proposed permit, as provided by these permit conditions. (9) Any requirements of the construction permit may be reopened for cause after incorporation into the Title V permit by the administrative amendment process, by DEQ as provided in OAC 252:100-8-7.3 (a), (b), and (c), and by EPA as provided in 40 CFR § 70.7 (f) and (g). (10) The DEQ shall not issue the administrative permit amendment if performance tests fail to demonstrate that the source is operating in substantial compliance with all permit requirements.

B. To the extent that these conditions are not followed, the Title V permit must go through the Title V review process.

SECTION XXII. CREDIBLE EVIDENCE

For the purpose of submitting compliance certifications or establishing whether or not a person has violated or is in violation of any provision of the Oklahoma implementation plan, nothing shall preclude the use, including the exclusive use, of any credible evidence or information, relevant to whether a source would have been in compliance with applicable requirements if the appropriate performance or compliance test or procedure had been performed. [OAC 252:100-43-6] PART 70 PERMIT AIR QUALITY DIVISION STATE OF OKLAHOMA DEPARTMENT OF ENVIRONMENTAL QUALITY 707 N. ROBINSON STREET, SUITE 4100 P.O. BOX 1677 OKLAHOMA CITY, OKLAHOMA 73101-1677

Permit Number: 97-227-TV

Atlas Pipeline Mid-Continent, L.L.C., having complied with the requirements of the law, is hereby granted permission to operate Velma Gas Plant located at Sec.23-1S-5W in Stephens County, Oklahoma, subject to the following conditions, attached:

[X] Title V Standard Conditions dated July 1, 2005 [X] Specific Conditions

The permit shall expire in 5 (five) years from the date of issuance.

______Director, Air Quality Division Issuance Date Atlas Pipeline Mid-Continent, L.L.C. Attn: James Branscum Eastern Area Manager P. O. Box 610, Velma, OK 73491

Re: Operating Permit No. 97-227-TV Velma Gas Plant Section 23, T-1S, R-5W, Stephens County, Oklahoma.

Dear Mr. Branscum:

Air Quality Division has completed the initial review of your permit application referenced above. This application has been determined to be a Tier II. In accordance with 27A O.S. § 2- 14-302 and OAC 252:002-4-7-13(c) the enclosed draft permit is now ready for public review. The requirements for public review include the following steps that you must accomplish:

1. Publish at least one legal notice (one day) in at least one newspaper of general circulation within the county where the facility is located. (Instructions enclosed)

2. Provide for public review (for a period of 30 days following the date of the newspaper announcement) a copy of this draft permit and a copy of the application at a convenient public location within the county of the facility such as the public library in the county seat.

3. Send to AQD a copy of the proof of publication notice from Item #1 above together with any additional comments or requested changes that you may have on the draft permit.

Thank you for your cooperation. If you have any questions, please contact me at (405) 702- 4100.

Sincerely,

Dawson F. Lasseter, P.E. Chief Engineer AIR QUALITY DIVISION

Enclosures Texas Commission On Environmental Quality Office of Permitting, Remediation and Registration Air Permits Division Operating Permits Section, MC 163 P. O. Box 13087 Austin, Texas 78711-3087

Subject: Permit Number: 97-227-TV Company: Atlas Pipeline Mid-Continent, L.L.C.. Facility: Velma Gas Plant Location: Section 23, T-1S, R-5W, Stephens County, Oklahoma. Permit Writer: Iftekhar Hossain, P.E.

Dear Sir / Madam:

The subject facility has requested a Title V operating permit for the above referenced facility. Air Quality Division has completed the initial review of the application and prepared a draft permit for public review. Since this facility is within 50 miles of the Oklahoma-Texas border, a copy of the proposed permit will be provided to you upon request. Information on all permit and a copy of this draft permit are available for review by the public in the Air Quality Section of DEQ Web Page: http://www.deq.state.ok.us.

Thank you for your cooperation. If you have any questions, please refer to the permit number above and contact me or contact the permit writer at (405) 702-4100.

Sincerely,

Dawson F. Lasseter, P.E. Chief Engineer AIR QUALITY DIVISION

Enclosure: cc: Stephens County DEQ Office