Oklahoma Department of Environmental Quality s14

OKLAHOMA DEPARTMENT OF ENVIRONMENTAL QUALITY AIR QUALITY DIVISION

MEMORANDUM April 18, 2006

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

THROUGH: Richard Kienlen, P.E., Engr. Mgr. II, New Source Permits Section Herb Neumann, P.E., ROAT

THROUGH: Peer Review, Hal Wright, ROAT

FROM: Judy A. Cupples, ROAT

SUBJECT: Evaluation of Permit Application No. 2004-330-O Ozark Gas Transmission, L.L.C. Blackman Compressor Station Section 23, T9N, R26E, Le Flore County, Oklahoma Driving Directions: From the intersection of Highways 9 and 112, travel 3.1 miles South to McKenzie Avenue, turn West and travel 1.8 miles, turn North on lease road and travel 0.4 mile to facility entrance.

INTRODUCTION

Ozark Gas Transmission, L.L.C. (OGT), has submitted a Part 70 Title V operating permit application for their air polluting activities at the Blackman Compressor Station (SIC 4922, NAICS 48621). The facility has been operating under the SOP #20 permit exemption (now revoked), per Applicability Determination No. 97-487-AD, issued August 7, 1997. This permit action partially satisfies Order No. 12 of Consent Order No. 02-361, executed March 10, 2005, and is processed as a Tier II application. OGT requests the establishment of federally enforceable emission limits that are below the major source thresholds of 100 tons per year (TPY) of any criteria pollutant. Upon issuance of the permit, this facility is a “synthetic” minor emission source.

PROCESS DESCRIPTION

The Blackman facility is an existing natural gas-gathering compressor station. Natural gas dehydration and storage of produced water/condensate occurs on-site, as well. Natural gas is transported to the facility via a pipeline gathering system. The gas stream enters the facility through inlet separators, where produced water and condensate are removed from the inlet stream and collected in a storage tank. The gas is then transported to the compressors where it is PERMIT MEMORANDUM 2004-330-O DRAFT 2 compressed by one Caterpillar G342TA natural gas-fired engine-driven compressor, rated at 265 horsepower (hp), and one Caterpillar G379TA natural gas-fired engine-driven compressor that is rated at 415 hp. After compression, the gas passes through a glycol dehydrator where water is removed. In the dehydration process, gas passes through triethylene glycol (TEG) contactor vessels where water is absorbed by the dessicant. The “rich” glycol (containing water) is routed to the TEG reboiler where heat is employed to drive off the water by vaporization. The still vent collects the water vapor and vents it to the atmosphere. The dry gas then exits the facility via pipeline transportation.

EQUIPMENT

Natural gas compression equipment at this facility includes one 265-hp Caterpillar Model 342TA compressor engine (ENG-1), one 415-hp Caterpillar Model 379TA compressor engine (ENG-2), a glycol dehydrator still vent (VENT) and reboiler (REB), a 300-bbl produced water/condensate storage tank (TNK) and other miscellaneous storage tanks. Other emission sources include truck loading and process piping. A description of each emission unit is presented in Table 1 with construction dates.

TABLE 1 - EMISSIONS SOURCES Unit Emission Unit Description Serial # Const. Date ENG-1 265-hp Caterpillar Model 342TA 71B3034 Before 7-31-97 ENG-2 415-hp Caterpillar Model 379TA 72B01002 Before 7-31-97 VENT Glycol Dehydrator Still Vent  Before 7-31-97 REB Glycol Dehydrator Reboiler  Before 7-31-97 TNK Produced Water/Condensate Storage Tank  Before 7-31-97 LOAD Produced Water/Condensate Truck Loading   FUG Process Piping Fugitives  Before 7-31-97 FLASH Tank Flashing Losses  Before 7-31-97

EMISSIONS Emission estimates for the engines are based on emission factors obtained from manufacturer’s data provided by the applicant, plus a safety factor, and continuous operation for each engine. Emission factors used were 15.0 g/bhp-hr NOX, 15.0 g/bhp-hr CO, and 0.8 g/bhp-hr VOC. Emissions of SO2 and PM are assumed negligible. Engine criteria pollutant emissions are summarized in Table 2, below.

TABLE 2 – ENGINE CRITERIA EMISSIONS NO CO VOC Source X lb/hr TPY lb/hr TPY lb/hr TPY ENG-1, 265-hp Caterpillar Model 342TA 8.76 38.38 8.76 38.38 0.47 2.05 ENG-2, 415-hp Caterpillar Model 379TA 13.72 60.11 13.72 60.11 0.73 3.21 TOTAL 22.48 98.49 22.48 98.49 1.20 5.26 PERMIT MEMORANDUM 2004-330-O DRAFT 3

Brake specific fuel consumption for the 265-hp Caterpillar 342TA engine is listed at 2,184 SCFH. Air emissions from the engine will be discharged through a stack 0.83 feet in diameter, 12 feet above grade, at a rate of 1,005 ACFM at 1,095 F. Brake specific fuel consumption for the 415-hp Caterpillar 379TA engine is listed at 3,265 SCFH. Air emissions from the engine will be discharged through a stack 1.0 feet in diameter, 20 feet above grade, at a rate of 2,225 ACFM at 1,097 F.

The internal combustion engines will have emissions of hazardous air pollutants (HAPs). Table 3 lists the HAPs expected from engine combustion. All emission factors are from AP-42 (7/00), Table 3.2-3.

TABLE 3 – ENGINE HAP EMISSIONS Fuel Usage Em. Factor Emissions Source Parameter (Btu/hp-hr) (lb/MMBtu) lb/hr TPY Benzene 0.00158 0.0034 0.0151 Toluene 0.000558 0.0012 0.0053 ENG-1, 265-hp Ethylbenzene 0.0000248 0.0001 0.0002 Caterpillar 342TA Xylene 8,242 0.000195 0.0004 0.0019 Formaldehyde 0.0205 0.0448 0.1960 Acrolein 0.00263 0.0057 0.0252 Acetaldehyde 0.00279 0.0061 0.0267 TOTAL 0.06 0.27 Benzene 0.00158 0.0052 0.0226 Toluene 0.000558 0.0018 0.0080 ENG-2, 415-hp Ethylbenzene 0.0000248 0.0001 0.0004 Caterpillar 379TA Xylene 7,867 0.000195 0.0006 0.0028 Formaldehyde 0.0205 0.0669 0.2930 Acrolein 0.00263 0.0086 0.0376 Acetaldehyde 0.00279 0.0091 0.0399 TOTAL 0.09 0.40

The dehydrator uses triethylene glycol. Emissions of criteria pollutants from the glycol dehydration reboiler were estimated based on the actual burner rating of 0.2 MMBtu/hr, factors for commercial boilers from AP-42 (7/98), Tables 1.4-1 through 1.4-3, and 8,760 hours per year of operation. Emission factors used were 100 lb/MMscf NOX, 84 lb/MMscf CO, and 5.5 lb/MMscf VOC. An average value of 1,020 Btu/scf was used to convert emission factors to lb/MMBtu. Potential criteria pollutant emissions from the glycol dehydration reboiler are summarized in Table 4, below.

TABLE 4 – CRITERIA EMISSIONS FROM REBOILER NO CO VOC Source X lb/hr TPY lb/hr TPY lb/hr TPY Glycol Dehydration Reboiler 0.02 0.09 0.02 0.07 0.001 0.005 PERMIT MEMORANDUM 2004-330-O DRAFT 4

VOC and HAP emissions from the glycol dehydrator still vent were calculated using GRI- GLYCalc Version 4.0 software with a maximum natural gas throughput of 6.0 MMscf/d and maximum glycol recirculation rate of 1.5 gal/min. Data from an extended gas analysis and HAP analyses of samples using EPA’s ARL method were also provided. Potential VOC and HAP emissions from the glycol dehydration process are summarized in Table 5, below.

TABLE 5 – VOC AND HAP EMISSIONS FROM GLYCOL DEHYDRATION Parameter GRI-GLYCalc ARL Analysis lb/hr TPY lb/hr TPY Benzene 0.0008 0.0031 0.0004 0.0020 Toluene 0.0016 0.0070 0.0007 0.0033 Ethylbenzene 0.0001 0.0004 0.0000 0.0000 Total Xylenes 0.0022 0.0096 0.0015 0.0065 n-Hexane 0.0613 0.2685 0.0030 0.0131 Total HAPs 0.07 0.31 Total VOCs 0.20 0.85

Potential breathing and working VOC losses from the 300-bbl produced water/condensate tank were estimated using EPA’s TANKS4.0 program, assuming a maximum annual condensate throughput value for the tank of 200,000 gallons per year. VOC emissions from flashing are based on the Vasquez-Beggs Equation (VBE) method. Tank emissions are summarized in Table 6, below. TABLE 6 – TANK VOC EMISSIONS Breathing Working Flashing Total Source (lb/yr) (lb/yr) (TPY) (TPY) Water/Condensate Tank 984.34 1,709.98 48.31 49.66

Potential fugitive VOC emissions from process piping are based on EPA’s 1995 Protocol for Equipment Leak Emission Estimates (EPA-453/R-95-017). Component counts and calculated emissions are presented in Table 7, below.

TABLE 7 – POTENTIAL PROCESS PIPING FUGITIVE EMISSIONS Number of Em. Factors VOC Potential Emissions Source Service Components (lb/hr/comp.) % lb/hr TPY Valves Gas/Vapor 100 0.00992 0.23 0.002 0.01 Flanges Gas/Vapor 110 0.00086 0.23 < 0.001 < 0.01 Compressor Seals Gas/Vapor 40 0.0194 0.23 0.002 0.01 Relief Valves Gas/Vapor 25 0.0194 0.23 0.001 < 0.05 Valves Lt. Liquid 10 0.0055 100 0.060 0.24 Flanges Lt. Liquid 11 0.0002 100 0.003 0.01 Pump Seals Lt. Liquid 6 0.0287 100 0.170 0.75 Relief Valves Lt. Liquid 5 0.0165 100 0.080 0.36 Pump Seals Heavy Liq. 10 0.0000 100 0.000 0.00 TOTAL 317 ― ― 0.32 1.41 Condensate truck loading emissions are based on AP-42 (1/95), Section 5.2, Equation 1, PERMIT MEMORANDUM 2004-330-O DRAFT 5

SPM L 12.46 L T where: 3 LL = loading loss, pounds per 1,000 gallons (lb/10 gal) of liquid loaded S = a saturation factor, 0.6 P = true vapor pressure of liquid loaded, 6.10 pounds per square inch absolute (psia) M = molecular weight of vapors, 66 pounds per pound-mole (lb/lb-mole) T = temperature of bulk liquid loaded, 520.56°R (60.56°F + 460)

Using an estimated annual throughput of 200,000 gal/yr, VOC emissions from condensate truck loading were calculated to be 0.58 TPY. Table 8 summarizes facility-wide criteria pollutants from all sources.

TABLE 8 – SUMMARY OF EMISSIONS NO CO VOC HAP Unit Emissions Source X lb/hr TPY lb/hr TPY lb/hr TPY lb/hr TPY ENG-1 265-hp Caterpillar 342TA 8.76 38.3 8.76 38.3 0.47 2.05 0.06 0.29 8 8 ENG-2 415-hp Caterpillar 379TA 13.72 60.1 13.72 60.1 0.73 3.21 0.09 0.40 1 1 REB Glycol Dehydrator Reboiler 0.02 0.09 0.02 0.07 0.001 0.01 ― ― VENT Glycol Dehydrator Still Vent ― ― ― ― 0.20 0.85 0.07 0.31 TNK Storage Tank ― ― ― ― ― 1.35 ― ― FUG Process Piping Fugitives ― ― ― ― 0.32 1.41 ― ― LOAD Loading ― ― ― ― ― 0.58 ― ― FLASH Tank Flashing Losses ― ― ― ― ― 48.31 ― ― TOTAL 22.50 98.5 22.50 98.5 1.72 57.77 0.22 1.00 8 6

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] Subchapter 3 enumerates the primary and secondary ambient air quality standards and the significant deterioration increments. At this time, all of Oklahoma is in “attainment” of these standards.

OAC 252:100-4 (New Source Performance Standards) [Not 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, PERMIT MEMORANDUM 2004-330-O DRAFT 6

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 were submitted and fees paid for previous years as required.

OAC 252:100-7 (Permits for Minor Facilities) [Applicable] Subchapter 7 sets forth the permit application fees and the basic substantive requirements of permits for minor facilities. Since criteria pollutant emissions are less than 100 TPY for each pollutant, and emissions of Hazardous Air Pollutants (HAP) will not exceed 10 TPY for any one HAP or 25 TPY for any aggregate of HAP, the facility is defined as a minor source. As such, BACT is not required. Federally enforceable permit limits ensure the source remains minor.

OAC 252:100-8 (Operating Permits (Part 70)) [Not Applicable] This facility meets the definition of a major source since it has the potential to emit regulated pollutants in excess of 100 TPY. As such, a Title V (Part 70) operating permit is required. This facility has submitted a Title V (Part 70) operating permit application in compliance with Consent Order No. 02-361 and has accepted federally enforceable emission limits that make the facility a “synthetic” minor source. Any planned changes in the operation of the facility which result in emissions not authorized in the permit require prior notification to AQD and may require a permit modification.

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. Within ten (10) working days after the immediate notice is given, the owner or operator shall submit a written report describing the extent of the excess emissions and response actions taken by the facility.

OAC 252:100-13 (Open Burning) [Applicable] 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 (PM)) [Applicable] Section 19-4 regulates emissions of PM from new and existing fuel-burning equipment, with emission limits based on maximum design heat input rating. Appendix C specifies a PM emission limitation of 0.60 lb/MMBtu for all equipment at this facility with a heat input rating of 10 Million Btu per hour (MMBtu/hr) or less. Fuel-burning equipment is defined in OAC 252:100-1 as “combustion devices used to convert fuel or wastes to usable heat or power.” Thus, the compressor engines and glycol dehydrator reboiler are subject to the requirements of this subchapter.

AP-42 (7/00), Sec. 3.2, lists total PM emissions from 4-stroke rich-burn natural gas-fired engines PERMIT MEMORANDUM 2004-330-O DRAFT 7 to be 0.0095 lbs/MMBtu. AP-42 (7/98), Table 1.4-2 lists total PM emissions for natural gas combustion from heaters, boilers, etc., to be 0.0076 lbs/MMBtu. The affected units at this facility are compliant.

OAC 252:100-25 (Visible Emissions and Particulate Matter) [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. Under normal operating conditions, this facility will not cause a problem in this area, therefore it is not necessary to require specific precautions to be taken.

OAC 252:100-31 (Sulfur Compounds) [Applicable] Part 5 The new equipment standard for emissions of oxides of sulfur measured as sulfur dioxide from gas-fired fuel-burning equipment is 0.2 pounds per MMBtu heat input, maximum three-hour 3 average. AP-42, Table 1.4-2 (3/98), lists natural gas SO2 emissions to be 0.6 lb/MMft or about 0.0006 lb/MMBtu, which is in compliance.

OAC 252:100-33 (Nitrogen Oxides) [Not Applicable] This subchapter limits new gas-fired fuel-burning equipment with rated heat input greater than or equal to 50 MMBtu/hr to emissions of 0.2 lbs of NOX per MMBtu, three-hour average. There are no equipment items that exceed the 50 MMBtu/hr 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 (Volatile Organic Compounds) [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 to be equipped with a permanent submerged fill pipe or with an organic vapor recovery system. The condensate tank is equipped with a submerged fill pipe. Part 5 limits the VOC content of coating used in coating lines or operations. This facility will not normally conduct coating or painting operations except for routine maintenance of the facility and equipment, which is exempt. Part 7 requires fuel-burning equipment to be operated and maintained so as to minimize VOC emissions. Temperature and available air must be sufficient to provide essentially complete PERMIT MEMORANDUM 2004-330-O DRAFT 8 combustion. The compressor engines are designed to provide essentially complete combustion of organic materials. Part 7 also requires all rotating pumps or compressors handling VOC to be equipped with mechanical seals or other equipment of equal efficiency. All reciprocating pumps or compressors handling VOC are to be equipped with packing glands that are properly installed and in good working order such that emissions from the drain recovery system are limited to two cubic inches of VOC in any 15 minute period at standard conditions per pump or compressor. The equipment at this location is subject to this requirement. Part 7 also regulates effluent water separators that receive water containing more than 200 gallons per day of VOC. There is no effluent separator at this location.

OAC 252:100-41 (Hazardous Air Pollutants) [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)) [Not 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. PERMIT MEMORANDUM 2004-330-O DRAFT 9

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 any EPA Reference Method stack tests. 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 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 Pollution Control 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 Landfills not in source category

FEDERAL REGULATIONS

PSD, 40 CFR Part 52 [Not Applicable at This Time] PSD does not apply. Final total emissions are less than the threshold of 250 TPY of any single regulated pollutant and the facility is not one of the 28 specific industries with an emission threshold of 100 TPY.

NSPS, 40 CFR Part 60 [Not Applicable] Subparts K, Ka, Kb, VOL Storage Vessels. The tank at this facility is not large enough to trigger any of these subparts. Subpart GG, Stationary Gas Turbines. There are none at this facility. Subpart VV, Equipment Leaks of VOC in the Synthetic Organic Chemical Manufacturing Industry. The equipment is not in a SOCMI plant. Subpart KKK, Equipment Leaks of VOC from Onshore Natural Gas Processing Plants. The facility does not engage in natural gas processing. Subpart LLL, Onshore Natural Gas Processing: SO2 Emissions. This subpart sets standards for natural gas sweetening units. There is no natural gas sweetening operation at this site.

NESHAP, 40 CFR Part 61 [Not Applicable] PERMIT MEMORANDUM 2004-330-O DRAFT 10

There are no emissions of any of the regulated pollutants: arsenic, asbestos, benzene, beryllium, coke oven emissions, mercury, radionuclides or vinyl chloride except for trace amounts of benzene. Subpart J, Equipment Leaks of Benzene, concerns only process streams that 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 [Not Applicable] Subpart HH, Oil and Natural Gas Production Facilities. This subpart applies to affected emission points that are located at facilities that 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. The facility is not a major source of HAPs. Subpart HHH, Natural Gas Transmission and Storage. This subpart applies to affected emission points that are located at facilities that are major sources of HAPs, as defined in this subpart, and that transport or store natural gas prior to entering the pipeline to a local distribution company or to a final end user. A compressor station that transports natural gas prior to the point of custody transfer, or to a natural gas processing plant (if present) is considered a part of the oil and natural gas production source category. This facility is not a major source of HAPs. Subpart EEEE, Organic Liquids Distribution (Non-Gasoline). This subpart affects organic liquid distribution (OLD) operations only at major sources of HAPs with an organic liquid throughput greater than 7.29 million gallons per year (173,571 barrels/yr). The facility is not a major source of HAPs. Subpart ZZZZ, Reciprocating Internal Combustion Engines (RICE). This subpart affects RICE with a site rating greater than 500 brake horsepower that are located at a major source of HAPs: existing, new, and reconstructed spark ignition 4 stroke rich burn (4SRB) RICE, any new or reconstructed spark ignition 2 stroke lean burn (2SLB) or 4 stroke lean burn (4SLB) RICE, or any new or reconstructed compression ignition (CI) RICE. The site rating on both engines is less than the threshold and the facility is a minor source of HAPs. Subpart DDDDD, Industrial, Commercial and Institutional Boilers and Process Heaters. This subpart affects new, reconstructed, and existing boilers and process heaters located at facilities considered major sources of HAPs. This facility is not a major source of HAPs.

Chemical Accident Prevention Provisions, 40 CFR Part 68 [Not Applicable] This facility does not process or store more than the threshold quantity of any regulated substance (Section 112r of the Clean Air Act 1990 Amendments). More information on this federal program is available on the web page: www.epa.gov/ceppo.

Stratospheric Ozone Protection, 40 CFR Part 82 [Not 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 PERMIT MEMORANDUM 2004-330-O DRAFT 11 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 hydrochlorofluorocarbons (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.

This facility does not utilize any Class I & II substances.

COMPLIANCE

Inspection and Testing A Partial Compliance Inspection was conducted on April 6, 2006, at approximately 1:00 p.m. Adam McGhee, EH&S Specialist for Atlas Pipeline, and David W. Wofford, Manager of Operations for the Ozark Ft. Smith office, met the DEQ representative, Judy Cupples, in Ft. Smith, Arkansas, and drove the inspector to the station. The facility was as represented in the permit application. Required records are maintained in Tulsa. Tables 9 and 10 summarize the confirmed findings of the inspection.

TABLE 9 – ENGINES PRESENT Unit Description hp CC (Y/N) Serial No. RPM Temp. (ºF) ENG-1 Caterpillar Model 342TA 265 N 71B3034 1,006 195 ENG-2 Caterpillar Model 379TA 415 N 72B01002 988 200

TABLE 10 – TANKS PRESENT Contents Size – gal/bbl H/L (ft) D (ft) Sub. Fill Pipe? Produced Water/Condensate 300 bbl ─ ─ Y Used Oil 350 gal 6 3.5 N/A Engine Oil 350 gal 6 3.5 N/A Other: TEG ─ ─ ─ N/A Drums (3) 55 gal each ─ ─ ─ NA = Not Applicable: vapor pressure is less than 1.5 psia or tank is too small

Station Gas Pressure: Inlet and outlet gas pressure to each compressor was monitored continuously by a Murphymatic control panel on each. At the time of the inspection, the following readings were noted on the ENG-1 meter:

Inlet gas pressure: 75 psig PERMIT MEMORANDUM 2004-330-O DRAFT 12

Outlet gas pressure: 880 psig

Dehydrator: The facility uses triethylene glycol (TEG) in the dehydrator. The reboiler rating is 0.2 MMBtu/hr. A Kimray 9015PV provides a glycol recirculation rate of 1.5 gallons per minute. The flash tank gases are routed back to the reboiler fuel lines. The dehy appeared to be in good working order.

Testing Tests were performed March 23, 2006, for NOX and CO on the engines at the Blackman facility. OGT submitted the results shown below. Tons per year emissions were calculated from reported pounds per hour emissions, assuming 8,760 hours per year service.

TABLE 11 – EMISSIONS TEST RESULTS NO CO Source X lb/hr TPY lb/hr TPY ENG-1, 265-hp Caterpillar 342TA 3.94 17.26 2.28 9.99 ENG-2, 415-hp Caterpillar 379TA 7.13 31.23 2.15 9.42

Tier Classification and Public Review This application has been processed as a Tier II based on the request for a “synthetic” minor operating permit for a potential major source. This permit action satisfies a condition of Consent Order No. 02-361 that required the applicant to submit a Title V operating permit application. The applicant has submitted an affidavit stating that notification was delivered to Landowner(s) by certified mail, restricted delivery, for which the applicant has a signed return receipt.

The applicant published the “Notice of Tier II Permit Application Filing” in The Spiro Graphic, a newspaper printed and published in the City of Spiro, County of Le Flore and State of Oklahoma, on December 9, 2004. The notice stated that the application may be reviewed at the Spiro Public Library located at 208 S. Main St., in Spiro, OK, or at the AQD main office at 707 N. Robinson, Oklahoma City. Notice of the 30-day public review opportunity for the draft permit will be published by the applicant. The facility is located within 50 miles of the Oklahoma border with Arkansas. The State of Arkansas will be notified of the draft permit.

Fee Paid Initial Part 70 (Title V) operating permit fee of $2,000 has been paid.

SUMMARY

This facility was constructed as described in the Title V application. There are no active Air Quality compliance or enforcement issues that would affect the issuance of the permit. Issuance of the operating permit is recommended, contingent upon public and EPA reviews. DRAFT

PERMIT TO OPERATE AIR POLLUTION CONTROL FACILITY SPECIFIC CONDITIONS

Ozark Gas Transmission, L.L.C. Permit No. 2004-330-O Blackman Compressor Station

The permittee is authorized to operate in conformity with the specifications submitted to Air Quality on December 3, 2004. The Evaluation Memorandum, dated April 18, 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 emission limitations for each point.

NO CO VOC Unit Emissions Source X lb/hr TPY lb/hr TPY lb/hr TPY ENG-1 265-hp Caterpillar 342TA 8.76 38.3 8.76 38.3 0.47 2.05 ENG-2 415-hp Caterpillar 379TA 13.72 608.1 13.72 608.1 0.73 3.21 REB Glycol Dehydrator Reboiler 0.02 01.09 0.02 01.07 0.001 0.005 VENT Glycol Dehydrator Still Vent ― ― ― ― 0.20 0.85 TNK Storage Tank ― ― ― ― ― 1.35 FUG Process Piping Fugitives ― ― ― ― 0.32 1.41 LOAD Loading ― ― ― ― ― 0.58 FLASH Tank Flashing Losses ― ― ― ― ― 48.31

2. The permittee shall be authorized to operate the facility continuously (24 hours per day, every day of the year).

3. Each engine shall be fueled only with sweet pipeline-grade natural gas or field gas.

4. Each compressor engine shall have a permanent identification plate attached that shows the make, model number, and serial number.

5. At least once per calendar quarter, the permittee shall conduct tests of NOx and CO emissions from engine(s) and from each replacement engine/turbine when operating under representative conditions for that period. Testing is required for any engine/turbine that runs for more than 220 hours during that calendar quarter. Engines/turbines shall be tested no sooner than 20 calendar days after the last test. Testing shall be conducted using a portable analyzer in accordance with a protocol meeting the requirements of the “AQD Portable Analyzer Guidance” document or an equivalent method approved by Air Quality. When four consecutive quarterly tests show the engine/turbine to be in compliance with the emissions limitations shown in the permit, then the testing frequency may be reduced to semi-annual testing. Likewise, when the following two consecutive semi-annual tests show compliance, the testing frequency may be reduced to annual testing. Upon any showing of non- SPECIFIC CONDITIONS 2004-330-O DRAFT 2

compliance with emissions limitations or testing that indicates that emissions are within 10% of the emission limitations, the testing frequency shall revert to quarterly. Reduced testing frequency does not apply to engines with catalytic converters.

6. The permittee shall keep records of operations as listed below. These records shall be retained on-site or at a local field office for a period of at least two years following dates of recording, and shall be made available to regulatory personnel upon request.

a. Periodic testing of the engines for NOX and CO emissions. b. Hours of operation for each quarter when testing is not conducted. c. Analysis of current fuel gas sulfur content (updated whenever the supply changes). d. Throughput for the condensate tank (monthly and rolling 12-month totals). e. Gas throughput (monthly average).

7. When engine testing shows emission rates in excess of the lb/hr limits in Specific Condition No. 1, the owner or operator shall comply with the provisions of OAC 252:100-9 for excess emissions during start-up, shutdown, and malfunction of air pollution control equipment. Requirements of OAC 252:100-9 include prompt notification to AQD and prompt commencement of repairs to correct the condition of excess emissions.

8. Replacement (including temporary periods of 6 months or less for maintenance purposes) of internal combustion engines with emission limitations specified in this permit with an engine of lesser or equal emissions of each pollutant (in lbs/hr and TPY) are authorized under the following conditions.

a. The permittee shall notify AQD in writing within 10 days of startup of the replacement engine. Said notice shall identify the equipment removed and shall include the new engine make and model, serial number, horsepower rating, fuel usage, stack flow (ACFM), stack temperature (F), stack height (feet), stack diameter (inches), and pollutant emission rates (g/hp-hr, lb/hr, and TPY) at maximum horsepower for the altitude/location. b. Quarterly emission testing for NOX and CO shall be conducted for all replacement engine(s)/turbine(s) to confirm compliance with the emission limitations. A copy of the first quarter testing shall be provided to AQD within 60 days of start-up of each replacement engine/turbine. The test report shall include the engine fuel usage, stack flow (ACFM), stack temperature (F), stack height (feet), stack diameter (inches), and pollutant emission rates (g/hp-hr, lb/hr, and TPY) at maximum rated horsepower for the altitude/location. c. Replaced equipment and emissions shall be limited to equipment and emissions which are not subject to NSPS, NESHAP, or PSD. d. Permanent replacement of an engine shall subject the new engine to emission limits based on best available emission data and periodic testing as listed in these Specific Conditions.

9. The 300-bbl condensate tank shall be equipped for submerged fill. SPECIFIC CONDITIONS 2004-330-O DRAFT 3

10. The facility-wide condensate throughput shall be no more than 200,000 gallons in any one rolling 12-month period.

11. The facility-wide gas throughput shall be no more than 6 MMscf/day on a monthly average.

12. This permit supersedes all previous Air Quality permits for this facility, which are now null and void. MINOR SOURCE PERMIT TO OPERATE AIR POLLUTION CONTROL FACILITY STANDARD CONDITIONS (September 1, 2005)

A. The issuing Authority for the permit is the Air Quality Division (AQD) of the Oklahoma Department of Environmental Quality (DEQ) in accordance with and under the authority of the Oklahoma Clean Air Act. The permit does not relieve the holder of the obligation to comply with other applicable federal, state, or local statutes, regulations, rules, or ordinances. This specifically includes compliance with the rules of the other Divisions of DEQ: Land Protection Division and Water Quality Division.

B. A duly issued construction permit or authorization to construct or modify will terminate and become null and void (unless extended as provided in OAC 252:100-7-15(g)) 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 252:100-7-15(f)]

C. The recipient of a construction permit shall apply for a permit to operate (or modified operating permit) within 60 days following the first day of operation. [OAC 252:100-7-18(a)]

D. Unless specified otherwise, the term of an operating permit shall be unlimited.

E. Notification to the Air Quality Division of DEQ of the sale or transfer of ownership of this facility is required and shall be made in writing by the transferor within 10 days after such date. A new permit is not required. [OAC 252:100-7-2(f)]

F. The following limitations apply to the facility unless covered in the Specific Conditions:

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. All facilities that emit air contaminants are required to file an emission inventory and pay annual operating fees based on the inventory. Instructions and forms are available on the Air Quality section of the DEQ web page. www.deq.state.ok.us [OAC 252:100-5] 3. All excess emissions shall be reported to the Director of the Air Quality Division as soon as practical during normal office hours and no later than the next working day following the malfunction or release. Within ten (10) business days further notice shall be tendered in writing containing specific details of the incident. [OAC 252:100-9] 4. 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] 5. No particulate emissions from new fuel-burning equipment with a rated heat input of 10 MMBTUH or less shall exceed 0.6 lbs/MMBTU. [OAC 252:100-19] 6. 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] 7. 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 MINOR SOURCE STANDARD CONDITIONS September 1, 2005 2

properties, or cause air quality standards to be exceeded, or interfere with the maintenance of air quality standards. [OAC 252:100-29] 8. No sulfur oxide emissions from new gas-fired fuel-burning equipment shall exceed 0.2 lbs/MMBTU. No existing source shall exceed the listed ambient air standards for sulfur dioxide. [OAC 252:100-31] 9. Volatile Organic Compound (VOC) storage tanks built after December 28, 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 an organic material vapor-recovery system. [OAC 252:100-37-15(b)] 10. 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]

G. Any owner or operator subject to provisions of NSPS shall provide written notification as follows: [40 CFR 60.7 (a)]

1. A notification of the date construction (or reconstruction as defined under §60.15) of an affected facility is commenced postmarked no later than 30 days after such date. This requirement shall not apply in the case of mass-produced facilities which are purchased in completed form. 2. A notification of any physical or operational change to an existing facility which may increase the emission rate of any air pollutant to which a standard applies, unless that change is specifically exempted under an applicable subpart or in §60.14(e). This notice shall be postmarked 60 days or as soon as practicable before the change is commenced and shall include information describing the precise nature of the change, present and proposed emission control systems, productive capacity of the facility before and after the change, and the expected completion date of the change. The Administrator may request additional relevant information subsequent to this notice. 3. A notification of the actual date of initial start-up of an affected facility postmarked within 15 days after such date. 4. If a continuous emission monitoring system is included in the construction, a notification of the date upon which the test demonstrating the system performance will commence, along with a pretest plan, postmarked no less than 30 days prior to such a date.

H. Any owner or operator subject to 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 this subpart recorded in a permanent file suitable for inspection. This file shall be retained for at least five years following the date of such measurements, maintenance, and records. [40 CFR 60.7 (d)]

J. Any owner or operator subject to the provisions of NSPS shall conduct performance test(s) and furnish to AQD a written report of the results of such test(s). Test(s) shall be conducted within 60 days after achieving the maximum production rate at which the facility will be operated, but not later than 180 days after initial start-up. [40 CFR 60.8] PART 70 PERMIT

AIR QUALITY DIVISION STATE OF OKLAHOMA DEPARTMENT OF ENVIRONMENTAL QUALITY 707 N. ROBINSON, SUITE 4100 P.O. BOX 1677 OKLAHOMA CITY, OKLAHOMA 73101-1677

Permit No. 2004-330-O

Ozark Gas Transmission, L.L.C., having complied with the requirements of the law, is hereby granted permission to operate the Blackman Compressor Station in the Section 23, T9N, R26E , Le Flore County, near Pocola, Oklahoma, subject to the following conditions, attached:

[x] Standard Conditions dated September 1, 2005 [x] Specific Conditions

Director, Air Quality Division Date Atlas Pipeline Mid-Continent LLC Attn.: Mr. Adam M. McGhee, EH&S Specialist 1437 S. Boulder Ave., Suite 1500 Tulsa, OK 74119

Subject: Operating Permit No. 2004-330-O (M-2) Blackman Compressor Station

Dear Mr. McGhee:

Enclosed is the permit authorizing operation of the referenced facility. Please note that this permit is issued subject to certain standard and specific conditions, which are attached. These conditions must be carefully followed since they define the limits of the permit and will be confirmed by periodic inspections.

Also note that you are required to annually submit an emission inventory for this facility. An emission inventory must be completed on approved AQD forms and submitted (hardcopy or electronically) by March 1st of every year. Any questions concerning the form or submittal process should be referred to the Emission Inventory Staff at (405) 702-4100.

Thank you for your cooperation in this matter. If I may be of further service, please contact me at (918) 293-1619.

Sincerely,

Judy A. Cupples, E.I. Engineering Permits Section AIR QUALITY DIVISION

Enclosure cc: Poteau DEQ office Arkansas Dept. of Pollution Control and Ecology P. O. Box 8913 Little Rock, AR 72219-8913

SUBJECT: Permit Number: 2004-330-O Facility: Ozark Gas Transmission, L.L.C., Blackman Compressor Station Location: Le Flore County, Oklahoma Permit Writer: Judy A. Cupples, E.I.

Dear Sir/Madam:

The subject facility has requested a Tier II “synthetic” minor source operating permit. 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-Arkansas border, a copy of the proposed permit will be provided to you upon request. The draft permit is also available for review on the Air Quality Division section of the DEQ web page at 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 at (405) 702-4100.

Sincerely,

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