
[Federal Register Volume 81, Number 107 (Friday, June 3, 2016)]
[Rules and Regulations]
[Pages 35943-35981]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-11969]



[[Page 35943]]

Vol. 81

Friday,

No. 107

June 3, 2016

Part III





Environmental Protection Agency





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40 CFR Part 49





Federal Implementation Plan for True Minor Sources in Indian Country in 
the Oil and Natural Gas Production and Natural Gas Processing Segments 
of the Oil and Natural Gas Sector; Amendments to the Federal Minor New 
Source Review Program in Indian Country To Address Requirements for 
True Minor Sources in the Oil and Natural Gas Sector; Final Rule

  Federal Register / Vol. 81 , No. 107 / Friday, June 3, 2016 / Rules 
and Regulations  

[[Page 35944]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 49

[EPA-HQ-OAR-2014-0606; FRL-9946-56-OAR]
RIN 2060-AS27


Federal Implementation Plan for True Minor Sources in Indian 
Country in the Oil and Natural Gas Production and Natural Gas 
Processing Segments of the Oil and Natural Gas Sector; Amendments to 
the Federal Minor New Source Review Program in Indian Country To 
Address Requirements for True Minor Sources in the Oil and Natural Gas 
Sector

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The Environmental Protection Agency (EPA) is finalizing a 
federal implementation plan (FIP) that applies to new true minor 
sources and minor modifications at existing true minor sources in the 
oil and natural gas production and natural gas processing segments of 
the oil and natural gas sector that are locating or expanding in Indian 
reservations or in other areas of Indian country over which an Indian 
tribe, or the EPA, has demonstrated the tribe's jurisdiction. The FIP 
satisfies the minor source permitting requirement under the ``Federal 
Minor New Source Review (NSR) Program in Indian Country'' (referred to 
as the ``Federal Indian Country Minor NSR rule''). For the oil and 
natural gas production and natural gas processing segments of the oil 
and natural gas sector, the FIP requires compliance with emission 
limitations and other requirements from certain federal emission 
standards as written at the time of construction or modification for 
compression ignition and spark ignition engines; process heaters; 
combustion turbines; fuel storage tanks; glycol dehydrators; completion 
of hydraulically fractured oil and natural gas wells; reciprocating and 
centrifugal compressors (except those located at well sites); pneumatic 
controllers; pneumatic pumps; storage vessels; and fugitive emissions 
from well sites, compressor stations and natural gas processing plants.
    The EPA is also finalizing several amendments to the Federal Indian 
Country Minor NSR rule, including adding new text regarding the purpose 
of the program, revising the program overview provision, revising 
certain provisions to incorporate compliance with the FIP, revising the 
applicability provision to establish that oil and natural gas sources 
are required to comply with the FIP unless they either opt to obtain a 
source-specific permit or are otherwise required to do so, and revising 
the source registration provision for oil and natural gas sources 
constructing under this FIP. Also, we are revising the applicability of 
the Federal Indian Country Minor NSR rule to comport with a court 
decision that addressed the scope of the EPA's jurisdiction to 
implement the Federal Indian Country Minor NSR rule in Indian country: 
Oklahoma Dept. of Environmental Quality v. EPA, 740 F.3d 185 (D.C. Cir. 
2014). This court decision has the same effect on the scope of the 
EPA's jurisdiction under the Federal Major New Source Review Program 
for Nonattainment Areas in Indian Country and so we are changing the 
applicability of the Federal Indian Country Nonattainment Major NSR 
rule as well.

DATES: This final rule is effective on August 2, 2016.

ADDRESSES: The EPA has established a docket for this action under 
Docket ID No. EPA-HQ-OAR-2014-0606. All documents in the docket are 
listed on the http://www.regulations.gov Web site. Although listed in 
the index, some information is not publicly available, e.g., 
Confidential Business Information or other information whose disclosure 
is restricted by statute. Certain other material, such as copyrighted 
material, is not placed on the Internet and will be publicly available 
only in hard copy form. Publicly available docket materials are 
available electronically through http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Mr. Christopher Stoneman, Outreach and 
Information Division, Office of Air Quality Planning and Standards (C-
304-01), Environmental Protection Agency, Research Triangle Park, North 
Carolina, 27711, telephone number (919) 541-0823, facsimile number 
(919) 541-0072, email address: stoneman.chris@epa.gov. For questions 
about the applicability of this action to a particular source, please 
contact the appropriate EPA region:
     EPA Region 5 (Illinois, Indiana, Michigan, Minnesota, 
Ohio, and Wisconsin)--Ms. Genevieve Damico, Air Permits Section, 
Environmental Protection Agency, Region 5, Chicago, Illinois 60604; 
telephone number (312) 353-4761; fax (312) 385-5501; email address: 
damico.genevieve@epa.gov.
     EPA Region 6 (Arkansas, Louisiana, New Mexico, Oklahoma, 
and Texas)--Ms. Bonnie Braganza, Air Permits Section, Multimedia 
Permitting and Planning Division, Environmental Protection Agency 
Region 6, Dallas, Texas 75202; telephone number (214) 665-7340; fax 
number (214) 665-6762; email address: braganza.bonnie@epa.gov.
     EPA Region 8 (Colorado, Montana, North Dakota, South 
Dakota, Utah, and Wyoming)--Ms. Claudia Smith, Air Program, Mail Code 
8P-AR, Environmental Protection Agency Region 8, Denver, Colorado 
80202; telephone number (303) 312-6520; fax number (303) 312-6520; 
email address: smith.claudia@epa.gov.
     EPA Region 9 (Arizona, California, Hawaii, Nevada, and 
Pacific Islands)--Ms. Lisa Beckham, Permits Office, Air Division, Air-
3, Environmental Protection Agency Region 9, San Francisco, California 
94105; telephone number (415) 972-3811; fax number (415) 947-3579; 
email address: beckham.lisa@epa.gov.
     All other EPA regions--The permit reviewer for minor 
sources in Indian country for your EPA region. You can find the list of 
the EPA permit reviewers at: https://www.epa.gov/tribal-air/tribal-minor-new-source-review. Scroll down to the heading, ``Existing Source 
Registration,'' and click on ``Reviewing Authority'' to access 
``Environmental Protection Agency's Reviewing Authorities for 
Permits.''

SUPPLEMENTARY INFORMATION: The information presented in this preamble 
is organized as follows:

I. General Information
    A. What entities are potentially affected by this final action?
    B. Where can I get a copy of this document and other related 
information?
II. Summary of Final Oil and Natural Gas FIP
    A. Overview
    B. Eight Federal Rules and Exclusions in FIP
    C. Addressing Threatened and Endangered Species and Historic 
Properties
    D. Summary of Final Amendments to the Federal Indian Country 
Minor NSR Rule
III. Background
    A. Federal Indian Country Minor NSR Rule
    B. What is a FIP?
    C. Oil and Natural Gas Sector
    D. EPA Actions Affecting Oil and Natural Gas Minor Sources in 
Areas Covered by the Federal Indian Country Minor NSR Rule
IV. Summary of Final Action, Comments and Responses
    A. Overview of Changes to the FIP and Federal Indian Country 
Minor NSR Rule
    B. Proposed Amendments to the Federal Indian Country Minor NSR 
Rule
    C. Implementation-Related Issues
    D. Requirements Relating to Threatened or Endangered Species and 
Historic Properties
    E. Rationale for the FIP
    F. The FIP as an Alternative to Source-Specific Permits, General 
Permits and Permits by Rule

[[Page 35945]]

    G. Synthetic Minor Sources and Minor Modifications at Major 
Sources
    H. Nonattainment Areas
    I. How the EPA Selected Equipment Included in the Proposed FIP
    J. Pollutants Included in the Proposed FIP
    K. Exclusion of Existing Sources From the Proposed Oil and 
Natural Gas FIP
    L. General Comments (e.g., Administrative, Incorporate by 
Reference)
    M. Other Comments
V. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review and 
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Paperwork Reduction Act (PRA)
    C. Regulatory Flexibility Act (RFA)
    D. Unfunded Mandates Reform Act (UMRA)
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From 
Environmental Health Risks and Safety Risks
    H. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution or Use
    I. National Technology Transfer and Advancement Act (NTTAA)
    J. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    K. Congressional Review Act (CRA)

I. General Information

A. What entities are potentially affected by this final action?

    Entities potentially affected by this action consist of owners/
operators of facilities included in the following source categories 
that are located, or planning to locate, in an Indian reservation or in 
another area of Indian country (as defined in 18 U.S.C. 1151) over 
which an Indian tribe, or the EPA, has demonstrated that the tribe has 
jurisdiction where there is no EPA-approved program in place and that 
are subject to the requirements of the Federal Indian Country Minor NSR 
rule.

           Table 1--Source Categories Affected by This Action
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                                                  Examples of regulated
       Industry category         NAICS Code \a\  entities/description of
                                                    industry category
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Oil and Natural Gas Production/           21111  Exploration for crude
 Operations.                                      petroleum and natural
                                                  gas; drilling,
                                                  completing, and
                                                  equipping wells;
                                                  operation of
                                                  separators, emulsion
                                                  breakers, desilting
                                                  equipment, and field
                                                  gathering lines for
                                                  crude petroleum and
                                                  natural gas; and all
                                                  other activities in
                                                  the preparation of oil
                                                  and natural gas up to
                                                  the point of shipment
                                                  from the producing
                                                  property.
                                                 Production of crude
                                                  petroleum, the mining
                                                  and extraction of oil
                                                  from oil shale and oil
                                                  sands, the production
                                                  of natural gas, sulfur
                                                  recovery from natural
                                                  gas, and the recovery
                                                  of hydrocarbon liquids
                                                  from oil and natural
                                                  gas field gases.
Crude Petroleum and Natural Gas          211111  Exploration,
 Extraction.                                      development and/or the
                                                  production of
                                                  petroleum or natural
                                                  gas from wells in
                                                  which the hydrocarbons
                                                  will initially flow or
                                                  can be produced using
                                                  normal pumping
                                                  techniques or
                                                  production of crude
                                                  petroleum from surface
                                                  shales or tar sands or
                                                  from reservoirs in
                                                  which the hydrocarbons
                                                  are semisolids.
Natural Gas Liquid Extraction..          211112  Recovery of liquid
                                                  hydrocarbons from oil
                                                  and natural gas field
                                                  gases; and sulfur
                                                  recovery from natural
                                                  gas.
Drilling Oil and Natural Gas             213111  Drilling oil and
 Wells.                                           natural gas wells for
                                                  others on a contract
                                                  or fee basis,
                                                  including spudding in,
                                                  drilling in,
                                                  redrilling, and
                                                  directional drilling.
Support Activities for Oil and           213112  Performing support
 Natural Gas Operations.                          activities on a
                                                  contract or fee basis
                                                  for oil and natural
                                                  gas operations (except
                                                  site preparation and
                                                  related construction
                                                  activities) such as
                                                  exploration (except
                                                  geophysical surveying
                                                  and mapping);
                                                  excavating slush pits
                                                  and cellars, well
                                                  surveying; running,
                                                  cutting, and pulling
                                                  casings, tubes, and
                                                  rods; cementing wells,
                                                  shooting wells;
                                                  perforating well
                                                  casings; acidizing and
                                                  chemically treating
                                                  wells; and cleaning
                                                  out, bailing, and
                                                  swabbing wells.
Engines (Spark Ignition and             ** 2211  Provision of electric
 Compression Ignition) for                        power to support oil
 Electric Power Generation.                       and natural gas
                                                  production where
                                                  access to the electric
                                                  grid is unavailable.
------------------------------------------------------------------------
\a\ North American Industry Classification System.

    This list is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be potentially affected 
by this action. To determine whether your facility could be affected by 
this action, you should examine the applicability criteria in the final 
Federal Minor NSR Program in Indian Country (40 Code of Federal 
Regulations (CFR) 49.153), as well as the FIP applicability in Sec.  
49.101. If you have any questions regarding the applicability of this 
action to a particular entity, contact the appropriate person listed in 
the FOR FURTHER INFORMATION CONTACT section.

B. Where can I get a copy of this document and other related 
information?

    In addition to being available in the docket, an electronic copy of 
this final rule will also be available on the World Wide Web. Following 
signature by the EPA Administrator, a copy of this final rule will be 
posted in the regulations and standards section of our NSR home page 
located at http://www.epa.gov/nsr and on the tribal NSR page at https://www.epa.gov/tribal-air/tribal-minor-new-source-review.

II. Summary of Final Oil and Natural Gas FIP

A. Overview

    We are finalizing a FIP to protect air quality in Indian country 
due to the impact of new true minor sources \1\ and minor modifications 
at existing true minor sources in the oil and natural gas production 
and natural gas processing segments of the oil and natural gas sector 
that are locating or expanding in an Indian reservation or in another 
area

[[Page 35946]]

of Indian country over which a tribe, or the EPA, has demonstrated that 
the tribe has jurisdiction. The FIP applies to new and modified true 
minor sources that are located or expanding in the referenced areas of 
Indian country designated as attainment, unclassifiable or attainment/
unclassifiable. It does not apply to new and modified true minor 
sources that are located or expanding in referenced areas of Indian 
country designated nonattainment. The FIP does not apply to minor 
modification of major sources; such sources are required to obtain a 
source-specific permit prior to beginning construction starting 
September 2, 2014, per the Federal Indian Country Minor NSR rule.
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    \1\ Under Sec.  49.52(d), true minor source means a source, not 
including the exempt emissions units and activities listed in Sec.  
49.153(c), that emits, or has the potential to emit, regulated NSR 
pollutants in amounts that are less than the major source thresholds 
in Sec.  49.167 or Sec.  52.21, as applicable, but equal to or 
greater than the minor NSR thresholds in Sec.  49.153, without the 
need to take an enforceable restriction to reduce its potential to 
emit to such levels. That is, a true minor source is a minor source 
that is not a synthetic minor source. The potential to emit includes 
fugitive emissions, to the extent that they are quantifiable, only 
if the source belongs to one of the source categories listed in part 
51, appendix S, paragraph II.A.4(iii) or Sec.  52.21(b)(1)(iii), as 
applicable.
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    However, in response to comments, we are stating here our intent to 
potentially apply this national FIP's requirements as appropriate to 
nonattainment areas where the EPA has established a separate, area-
specific FIP. In that separate, area-specific action, we would 
propose--and seek comment on--the application of this FIP's 
requirements to new and modified true minor sources in those certain 
areas designated nonattainment. This possible, future extension of 
coverage of this FIP could provide a mechanism for streamlining 
permitting in nonattainment areas, protecting air quality and allowing 
continued oil and natural gas growth in Indian country.
    This FIP fulfills the EPA's obligation under the Federal Indian 
Country Minor NSR rule to issue minor source NSR pre-construction 
permits. The FIP provides a streamlined, alternative approach that 
fulfills the permitting requirement, while also ensuring air quality 
protection through requirements that are unambiguous and legally and 
practicably enforceable. The FIP approach is also transparent to the 
public; it is clear to the public what requirements will apply. The FIP 
reduces burden for sources and the Reviewing Authority and minimizes 
potential delays in new construction due to compliance with the minor 
NSR permitting obligation. True minor sources in the oil and natural 
gas production and natural gas processing segments of the oil and 
natural gas sector are required to comply with the FIP instead of 
obtaining a source-specific minor source permit, unless a source 
chooses to opt out of the FIP and to obtain a source-specific minor NSR 
permit instead. In addition, with advance notice the Reviewing 
Authority can require a source to obtain a source-specific permit based 
on local or reservation-specific air quality concerns where the 
emissions from the source could cause or contribute to a National 
Ambient Air Quality Standards (NAAQS) or Prevention of Significant 
Deterioration (PSD) increment violation. To protect the NAAQS, the 
Reviewing Authority can regulate emissions from operations at the minor 
source not regulated by the FIP, or can require more stringent emission 
limitations for operations at the source than would be required by the 
FIP.
    In this FIP, we require owners/operators of oil and natural gas 
production facilities and natural gas processing plants to comply with 
eight federal standards to reduce emissions of volatile organic 
compounds (VOC), nitrogen oxides (NOX), sulfur dioxide 
(SO2), particulate matter (PM, PM10, 
PM2.5), hydrogen sulfide (H2S), carbon monoxide 
(CO) and various sulfur compounds from the following units/processes in 
the oil and natural gas production and natural gas processing segments 
of the oil and natural gas sector: Compression ignition and spark 
ignition engines; process heaters; combustion turbines; fuel storage 
tanks; glycol dehydrators; completion of hydraulically fractured oil 
and natural gas wells; reciprocating and centrifugal compressors 
(except those located at well sites); pneumatic controllers; pneumatic 
pumps, and storage vessels; fugitive emissions from well sites; 
compressor stations and natural gas processing plants. The oil and 
natural gas FIP requires compliance with five NSPS and three national 
emission standards for hazardous air pollutants (NESHAP).\2\ These 
regulations are listed in Table 2.
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    \2\ Though this FIP only addresses new and modified true minor 
sources, it is important to note that NESHAPs not only apply to new 
sources but to existing sources as well.
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    The eight regulations and the provisions of each that are included 
in the oil and natural gas FIP are discussed in more detail in this 
section. The FIP's requirements include emission standards (that 
contain emission limitations), monitoring, testing, recordkeeping and 
reporting. For purposes of this FIP, true minor sources must comply 
with these standards, as they currently exist or as amended in the 
future, except for those provisions that we specifically exclude under 
the FIP (unless the source opts-out of the FIP and obtains a source-
specific permit or is otherwise required to obtain a source-specific 
permit by the Reviewing Authority). This includes the amendments to the 
oil and natural gas NSPS that have become part of the final oil and 
natural gas NSPS as a result of the 2016 final oil and natural gas 
NSPS.\3\ Sources subject to this FIP would be subject to any future 
changes to the eight underlying EPA standards only if they undergo a 
future minor modification as a true minor sources and would otherwise 
be subject to those future changes. To help understand the requirements 
of this oil and natural gas FIP, please see the 2016 final oil and 
natural gas NSPS and the provisions for each of the eight federal rules 
(i.e., five NSPS and three NESHAP) identified in Table 2.\4\ (This FIP 
does not change the applicability of the specified standards, nor does 
it relieve sources subject to the standards from complying with them, 
independently of this FIP.) The excluded provisions are listed below.
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    \3\ ``Oil and Natural Gas Sector: Emission Standards for New, 
Reconstructed and Modified Sources,'' U.S. Environmental Protection 
Agency, signed May 12, 2016, http://www.epa.gov/airquality/oilandgas/actions.html.
    \4\ The proposed FIP only included six emissions standards; in 
response to comments, we are adding two more, bringing the total to 
eight. For a discussion of this expansion and the pertinent 
comments, see Section IV.I.
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    Also discussed in this section are features of the FIP and 
amendments to the Federal Indian Country Minor NSR rule that are 
largely necessary to facilitate implementation of the FIP.

[[Page 35947]]



           Table 2--Eight Federal Rules Included in the Oil and Natural Gas FIP for Indian Country \5\
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                                                                  Potentially affected
                                                                 sources in the oil and
                                                                 natural gas production
       40 CFR part and subpart             Title of subpart         and natural gas              Location
                                                                 processing segments of
                                                                the oil and natural gas
                                                                         sector
----------------------------------------------------------------------------------------------------------------
40 CFR part 63, subpart DDDDD........  National Emission        Process heaters........  http://www.ecfr.gov/cgi-
                                        Standards for                                     bin/text-
                                        Hazardous Air                                     idx?SID=9f31077f895e9c
                                        Pollutants for Major                              b417f5386519941a47&mc=
                                        Sources: Industrial,                              true&node=sp40.14.63.d
                                        Commercial, and                                   dddd&rgn=div6.
                                        Institutional Boilers
                                        and Process Heaters.
40 CFR part 63, subpart ZZZZ \6\.....  Subpart ZZZZ--National   Reciprocating Internal   http://www.ecfr.gov/cgi-
                                        Emissions Standards      Combustion Engines.      bin/text-
                                        for Hazardous Air                                 idx?c=ecfr;rgn=div6;vi
                                        Pollutants for                                    ew=text;node=%3A14.0.1
                                        Stationary                                        .1.1.1;idno=40;sid=e94
                                        Reciprocating Internal                            dcfde4a04b27290c445a56
                                        Combustion Engines.                               e635e58;cc=ecfr.
40 CFR part 60, subpart IIII.........  Standards of             Compression Ignition     http://www.ecfr.gov/cgi-
                                        Performance for          Internal Combustion      bin/text-
                                        Stationary Compression   Engines.                 idx?SID=9f31077f895e9c
                                        Ignition Internal                                 b417f5386519941a47&mc=
                                        Combustion Engines.                               true&node=sp40.7.60.ii
                                                                                          ii&rgn=div6.
40 CFR part 60, subpart JJJJ.........  Standards of             Spark Ignition Internal  http://www.ecfr.gov/cgi-
                                        Performance for          Combustion Engines.      bin/text-
                                        Stationary Spark                                  idx?SID=9f31077f895e9c
                                        Ignition Internal                                 b417f5386519941a47&mc=
                                        Combustion Engines.                               true&node=sp40.7.60.jj
                                                                                          jj&rgn=div6.
40 CFR part 60, subpart Kb...........  Standards of             Fuel Storage Tanks.....  http://www.ecfr.gov/cgi-
                                        Performance for                                   bin/text-
                                        Volatile Organic                                  idx?SID=9f31077f895e9c
                                        Liquid Storage Vessels                            b417f5386519941a47&mc=
                                        (Including Petroleum                              true&node=sp40.7.60.k_
                                        Liquid Storage                                    0b&rgn=div6.
                                        Vessels) for Which
                                        Construction,
                                        Reconstruction, or
                                        Modification Commenced
                                        After July 23, 1984.
40 CFR part 60, subpart OOOOa (final)  Standards of             Storage Vessels,         http://www.epa.gov/
                                        Performance for Crude    Pneumatic Controllers,   airquality/oilandgas/
                                        Oil and Natural Gas      Compressors              actions.html.
                                        Facilities for which     (Reciprocating and
                                        Construction,            Centrifugal),
                                        Modification, or         Hydraulically
                                        Reconstruction           Fractured Oil and
                                        Commenced after          Natural Gas Well
                                        September 18, 2015.      Completions, Pneumatic
                                                                 Pumps and Fugitive
                                                                 Emissions from Well
                                                                 Sites and Compressor
                                                                 Stations.
40 CFR part 63, subpart HH...........  National Emission        Glycol Dehydrators.....  http://www.ecfr.gov/cgi-
                                        Standards for                                     bin/text-
                                        Hazardous Air                                     idx?SID=9f31077f895e9c
                                        Pollutants from Oil                               b417f5386519941a47&mc=
                                        and Natural Gas                                   true&node=sp40.11.63.h
                                        Production Facilities.                            h&rgn=div6.
40 CFR part 60, subpart KKKK \7\.....  Standards of             Combustion Turbines....  http://www.ecfr.gov/cgi-
                                        Performance for New                               bin/text-
                                        Stationary Combustion                             idx?SID=4090b6cf5eea5c
                                        Turbines.                                         b67940a80906ff09a2&mc=
                                                                                          true&node=sp40.7.60.kk
                                                                                          kk&rgn=div6.
----------------------------------------------------------------------------------------------------------------

B. Eight Federal Rules and Exclusions in FIP

    This oil and natural gas FIP requires owners/operators of new and 
modified existing true minor sources in the oil and natural gas 
production and natural gas processing segments of the oil and natural 
gas sector that are located in areas covered by the Federal Indian 
Country Minor NSR rule to comply with eight federal rules. One of the 
rules this FIP adopts is certain requirements of the final 40 CFR part 
60, subpart OOOOa NSPS.\8\ Requirements under the final NSPS, subpart 
OOOOa involve standards for oil and natural gas production and natural 
gas processing.\9\
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    \5\ Three of the eight rules are NESHAPs. Our basis for 
requiring compliance with NESHAPs in this rule that is designed to 
fulfill requirements of the Federal Indian Country Minor NSR rule is 
to address emissions of criteria pollutants. The requirements from 
the NESHAPs are included because they effectively control emissions 
of all VOC, not just those that are also HAP. VOC is an NSR-
regulated pollutant of concern in the Federal Indian Country Minor 
NSR rule.
    \6\ This regulation was not included in the proposed FIP but is 
being added to the final FIP in response to comments.
    \7\ Ibid.
    \8\ Finalized 40 CFR part 60, subpart OOOOa, covers the emission 
sources covered under existing 40 CFR part 60, subpart OOOO, as well 
as the added coverage of new, reconstructed and modified emission 
sources beyond those covered in existing 40 CFR part 60, subpart 
OOOO. These additional sources are hydraulically fractured oil well 
completions, pneumatic pumps and fugitive emissions from well sites 
and compressor stations.
    \9\ This list includes centrifugal compressors, reciprocating 
compressors, pneumatic controllers, pneumatic pumps, fugitive 
emissions from compressor stations, and storage vessels. It excludes 
sources located in the transmission and storage segment because they 
are not part of this FIP, which focusses on the oil and natural gas 
production and natural gas processing segments of the oil and 
natural gas sector.
---------------------------------------------------------------------------

    We are requiring under this FIP that owners/operators of new true 
minor sources and modifications of existing true minor sources comply 
with all applicable requirements of the eight federal rules listed in 
Table 2 above in effect at the time they begin construction, except for 
the excluded provisions indicated below. In general, for this FIP, we 
are excluding specific provisions of the rules for three reasons: (1) 
They are not relevant (e.g., equipment that is not used in this

[[Page 35948]]

sector); (2) they would not apply to the oil and natural gas production 
and natural gas processing segments of the oil and natural gas sector; 
(3) they apply only to equipment manufacturers and not to owners/
operators.
    For purposes of this FIP, owners/operators of true minor sources 
(and minor modifications at true minor sources) must comply with all of 
the applicable provisions of 40 CFR part 63, subpart DDDDD (NESHAP for 
Major Sources: Industrial, Commercial, and Institutional Boilers and 
Process Heaters), as written at the time \10\ the owner/operator begins 
construction on the new true minor source or on the minor modification 
at an existing true minor source.
---------------------------------------------------------------------------

    \10\ ``Written at the time'' for a rule means as currently 
written and as may be amended in the future.
---------------------------------------------------------------------------

    For purposes of this FIP, owners/operators of true minor sources 
(and minor modifications at true minor sources) must comply with all of 
the applicable provisions of 40 CFR part 63, subpart ZZZZ (NESHAP for 
Stationary Reciprocating Internal Combustion Engines), as written at 
the time the owner/operator begins construction on the new true minor 
source or on the minor modification at an existing true minor source.
    For purposes of this FIP, owners/operators of true minor sources 
(and minor modifications at true minor sources) must comply with all of 
the applicable provisions of 49 CFR part 60, subpart IIII (Standards of 
Performance for Stationary Compression Ignition Internal Combustion 
Engines), as written at the time the owner/operator begins construction 
on the new true minor source or on the minor modification at an 
existing true minor source, except for the following: \11\
---------------------------------------------------------------------------

    \11\ In the proposal, we excluded the following provision that 
we are now not excluding because area sources that are also true 
minor sources may be subject to this rule: Sec.  60.4200(c)--Am I 
subject to this subpart? (area sources and exemptions from Title V 
permits).
---------------------------------------------------------------------------

     Sec.  60.4200(a)(1)--Am I subject to this subpart? 
(applies to manufacturers);
     Sec.  60.4200(b)--Not applicable to a stationary ignition 
internal combustion engine being tested at an engine test cell/stand;
     Sec.  60.4201--What emission standards must I meet for 
non-emergency engines if I am a stationary compression ignition 
internal combustion engine manufacturer?;
     Sec.  60.4202--What emission standards must I meet for 
emergency engines if I am a stationary compression ignition internal 
combustion engine manufacturer?;
     Sec.  60.4203--How long must my engines meet the emission 
standards if I am a manufacturer of stationary compression ignition 
internal combustion engines?;
     Sec.  60.4210--What are my compliance requirements if I am 
a stationary compression ignition internal combustion engine 
manufacturer?; and
     Sec.  60.4215--What requirements must I meet for engines 
used in Guam, American Samoa, or the Commonwealth of the Northern 
Mariana Islands?.
    For purposes of this FIP, owners/operators of true minor sources 
(and minor modifications at true minor sources) must comply with all of 
the applicable provisions of 40 CFR part 60, subpart JJJJ (Standards of 
Performance for Crude Oil and Natural Gas Facilities for which 
Construction, Modification, or Reconstruction Commenced after September 
18, 2015), as written at the time the owner/operator begins 
construction on the new true minor source or on the minor modification 
at an existing true minor source, except for the following:
     Sec.  60.4230(b)--Not applicable to stationary spark 
ignition internal combustion engines being tested at an engine test 
cell/stand;
     Sec.  60.4230(c)--Exemption for obtaining a Title V permit 
for an owner or operator of an area source subject to this part;
     Sec.  60.4231 and Sec.  60.4232--Emission standards for 
manufacturers;
     Sec.  60.4238 through Sec.  60.4242--Compliance 
Requirements for Manufacturers; and
     Sec.  60.4247--Mobile source provisions that apply to 
manufacturers of stationary spark ignition internal combustion engines 
or equipment containing such engines.
    For purposes of this FIP, owners/operators of true minor sources 
(and minor modifications at true minor sources) must comply with all of 
the applicable provisions of 40 CFR part 60, subpart Kb (Standards of 
Performance for Volatile Organic Liquid Storage Vessels), as written at 
the time the owner/operator begins construction on the new true minor 
source or on the minor modification at an existing true minor source, 
except for the following:
     Sec.  60.112b(c)--Site-specific standard for Merck & Co., 
Inc.'s Stonewall Plant in Elkton, Virginia; and
     Sec.  60.117b(a) and (b)--Delegation of authority.
    For purposes of this FIP, owners/operators of true minor sources 
(and minor modifications at true minor sources) must comply with all of 
the applicable provisions of part 60, subpart OOOOa (Standards for New 
and Modified Sources in the Oil and Natural Gas Sector), as written at 
the time the owner/operator begins construction on the new true minor 
source or on the minor modification at an existing true minor source, 
except for the following: \12\
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    \12\ In the proposal, we excluded the following provision that 
we are now not excluding because we have expanded the scope of this 
FIP to include gas processing plants: Sec.  60.5365a(f)(3)--
Equipment exemption at processing plant.
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     Sec.  60.5365a(h)(4)--Existing sources constructed after 
August 23, 2011;
     Sec.  60.5370a(c)--Permit exemption;
     Sec.  60.5413a(a)(5)--Exemptions from performance 
testing--hazardous waste incinerator;
     Sec.  60.5420a(a)(2)(i)--Advance notification requirements 
for well completions; and
     Sec.  60.5420a(a)(2)(ii)--Advance notification 
requirements of well completions when subject to state regulation that 
requires advance notification.
    For purposes of this FIP, owners/operators of true minor sources 
(and minor modifications at true minor sources) must comply with all of 
the applicable provisions of 40 CFR part 63, subpart HH (NESHAP from 
Oil and Natural Gas Production Facilities), as written at the time the 
owner/operator begins construction on the new true minor source or on 
the minor modification at an existing true minor source, except for the 
following: \13\
---------------------------------------------------------------------------

    \13\ In the proposal, we excluded the following provision that 
we are now not excluding because we have expanded the scope of this 
FIP to include gas processing plants: Sec.  63.760(b)(1)(iii)--
Equipment located at natural gas processing plants. Similarly, for 
the same reason, we have also modified the exclusion for Sec.  
63.764(c)(2) by removing ``and equipment at natural gas processing 
plants, respectively.''
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     Sec.  63.760(a)(2)--Facilities that process, upgrade or 
store hydrocarbon liquids;
     Sec.  63.760(b)(1)(ii)--Each storage vessel with the 
potential for flash emissions;
     Sec.  63.760(g)--Recordkeeping for major sources that 
overlap with other regulations for equipment leaks;
     Sec.  63.764(c)(2)--Requirements for compliance with 
standards for storage vessels;
     Sec.  63.766--Storage vessel standards; and
     Sec.  63.769--Equipment leak standards.
    For purposes of this FIP, owners/operators of true minor sources 
(and minor modifications at true minor sources) must comply with all of 
the applicable provisions of 40 CFR part 60, subpart KKKK (Standards of 
Performance for Stationary Combustion

[[Page 35949]]

Turbines), as written at the time the owner/operator begins 
construction on the new true minor source or on the minor modification 
at an existing true minor source.

C. Addressing Threatened and Endangered Species and Historic Properties

    We are requiring that, prior to beginning construction, under Sec.  
49.104, new true minor sources and minor modifications at existing true 
minor sources document that potential impacts on threatened and 
endangered species and historic properties (collectively referred to as 
``protected resources'') have been assessed. The section provides two 
options for documenting this assessment: (1) Submittal of documentation 
to the EPA Regional Office (and to the relevant tribe for the area 
where the source is located or locating) that a site-specific 
assessment conducted by another federal agency has been completed for 
the specific oil and natural gas activity, and that the owner/operator 
meets all air quality-related requirements as specified within all 
documents/approvals obtained through that assessment (these 
requirements are typically implemented and enforced as conditions of an 
approved Surface Use Plan of Operations and/or Application for Permit 
to Drill); \14\ or (2) submittal of documentation to the EPA Regional 
Office (and to the relevant tribe for the area where the source is 
located or locating) demonstrating that the source has completed the 
screening processes specified by the EPA for consideration of 
threatened and endangered species and historic properties and received 
a determination from the EPA stating that it has satisfactorily 
completed these processes.\15\ (The processes are contained in the 
following document: ``Procedures to Address Threatened and Endangered 
Species and Historic Properties for the Federal Implementation Plan for 
Managing Air Emissions from True Minor Sources in Indian Country in the 
Oil and Natural Gas Production and Natural Gas Processing Segments of 
the Oil and Natural Gas Sector,'' https://www.epa.gov/tribal-air/tribal-minor-new-source-review.)
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    \14\ This assessment will typically be conducted through the 
National Environmental Policy Act process and result in either a 
Record of Decision or a Finding of No Significant Impact document.
    \15\ This process of source documentation submittal and the 
EPA's confirmation that it has satisfactorily completed the 
procedures must occur prior to the source's submittal of its Part 1 
Registration Form pursuant to Sec.  49.160(c)(1)(iv).
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D. Summary of Final Amendments to the Federal Indian Country Minor NSR 
Rule

    This action finalizes several amendments to the Federal Indian 
Country Minor NSR rule.
    First, we are revising Sec.  49.151(b)(1) to add new text regarding 
the purpose of the Federal Minor NSR Program in Indian Country. The 
revised text indicates that the program satisfies the requirements of 
section 110(a)(2)(C) of the Clean Air Act (CAA) by establishing: (1) A 
pre-construction permitting program for all new and modified minor 
sources (minor sources) and minor modifications at major sources 
located in Indian reservations and other areas of Indian country over 
which an Indian tribe, or the EPA, has demonstrated that the tribe has 
jurisdiction and where there is no EPA-approved program in place, and 
(2) a FIP (Sec. Sec.  49.101 to 49.105) for true minor sources in the 
oil and natural gas production and natural gas processing segments of 
the oil and natural gas sector that are located in such areas of Indian 
country.
    Second, we are revising Sec.  49.151(c)(1) (and Sec.  49.166(c)(1)) 
to comport the applicability of the Federal Indian Country Minor NSR 
rule with a court decision that addressed the scope of the EPA's 
jurisdiction to implement the Federal Indian Country Minor NSR rule: 
Oklahoma Dept. of Environmental Quality v. EPA, 740 F.3d 185 (D.C. Cir. 
2014) (hereinafter referred to as ODEQ v. EPA).\16\ We are also noting 
in the definition of Indian country in Sec.  49.152(d) (and Sec.  
49.167) that the geographic scope of the application of the rule is as 
specified in Sec.  49.151(c)(1) (and Sec.  49.166(c)(1)).\17\
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    \16\ In that case, the U.S. Court of Appeals for the District of 
Columbia Circuit vacated the Federal Indian Country Minor NSR rule 
and Federal Indian Country Nonattainment Major NSR rule with respect 
to non-reservation areas of Indian country (i.e., dependent Indian 
communities and Indian allotments located outside of reservations) 
in the absence of a demonstration of tribal jurisdiction by the EPA 
or a tribe.
    \17\ We are also revising Sec.  49.166(c)(1) to comport the 
applicability of the Federal Indian Country Nonattainment Major NSR 
rule with the ODEQ v. EPA decision. The court decision has the same 
effect on the scope of the EPA's jurisdiction under the Federal 
Major New Source Review Program for Nonattainment Areas in Indian 
Country and so we are changing the applicability of the Federal 
Indian Country Nonattainment Major NSR rule as well.
---------------------------------------------------------------------------

    Third, we are revising Sec.  49.151(c)(1)(iii)(A) to clarify 
requirements for oil and natural gas activities with respect to the 
registration deadline that conforms with the permitting deadline in 
Sec.  49.151(c)(1)(iii)(B).
    Fourth, we are revising Sec.  49.151(c)(1)(iii)(B) to clarify 
requirements for oil and natural gas activities with respect to the 
permitting deadline. We are also revising the provision to provide that 
true minor oil and natural gas sources can either comply with the FIP 
in lieu of obtaining a minor NSR permit or obtain a minor source permit 
if the source opts out of the FIP.
    Fifth, we are revising Sec.  49.151(d)(1), (2) and (4) to 
incorporate compliance with the FIP. We are revising Sec.  49.151(d)(1) 
to indicate that if you begin construction of a new source or 
modification that is subject to the Federal Indian Country Minor NSR 
Program after the applicable date \18\ without either applying for and 
receiving a permit pursuant to the program or complying with the FIP 
for the oil and natural gas production and natural gas processing 
segments of the oil and natural gas sector, the owner/operator of the 
source will be subject to appropriate enforcement action. We are 
revising Sec.  49.151(d)(2) to indicate that if you do not construct or 
operate your new source or existing source modification in accordance 
with the terms of your minor NSR permit or the FIP for the oil and 
natural gas production and natural gas processing segments of the oil 
and natural gas sector, you will be subject to appropriate enforcement 
action. We are revising Sec.  49.151(d)(4) to indicate that issuance of 
a permit or compliance with the FIP for the oil and natural gas 
production and natural gas processing segments of the oil and natural 
gas sector does not relieve the owner/operator of a source of the 
responsibility to comply fully with applicable provisions of any EPA-
approved implementation plan or FIP or any other requirements under 
applicable law.
---------------------------------------------------------------------------

    \18\ This date is September 2, 2014, for all true minor sources, 
except oil and natural gas true minor sources, and October 3, 2016, 
for oil and natural gas true minor sources.
---------------------------------------------------------------------------

    Sixth, we are amending Sec.  49.152 by adding a definition for 
``Startup of production,'' which, to ensure consistency across the 
EPA's regulations for the oil and natural gas sector, points directly 
to the term as defined under 40 CFR part 60, subpart OOOOa.
    Seventh, we are revising Sec. Sec.  49.153(a)(1)(i)(B) and 
(a)(1)(ii)(B) to establish that true minor sources in the oil and 
natural gas production and natural gas processing segments of the oil 
and natural gas sector are required to comply with the FIP, unless the 
owner/operator of a source opts-out or is otherwise required by the EPA 
to obtain a minor source permit. Existing Sec.  49.153(a)(1)(i)(B) 
requires the owner/

[[Page 35950]]

operator of a new source to determine whether the source's potential to 
emit (PTE) is equal to or greater than the corresponding minor NSR 
threshold. If it is, then the source is subject to the pre-construction 
requirements of the Federal Indian Country Minor NSR rule for that 
pollutant. The amendment adds a clause to the end of the paragraph 
stating that for sources in the oil and natural gas production and 
natural gas processing segments of the oil and natural gas sector, if 
the PTE for oil and natural gas production sources is equal to or 
greater than the corresponding minor NSR threshold, such sources shall 
instead comply with the requirements of Sec. Sec.  49.101 to 49.105, 
unless the owner/operator of the source opts-out of the FIP pursuant to 
Sec.  49.101(b)(2), or is otherwise required by the EPA to obtain a 
source-specific minor source permit pursuant to Sec.  49.101(b)(3).
    Existing Sec.  49.153(a)(1)(ii)(B) requires the owner/operator of 
modified sources to determine whether the increase in allowable 
emissions resulting from the modification would be equal to or greater 
than the minor NSR threshold for the pollutant being evaluated. If it 
is, then the source is subject to the pre-construction requirements of 
the Federal Indian Country Minor NSR rule for that pollutant. The 
amendment adds a clause to the end of the paragraph stating that, for 
sources in the oil and natural gas production and natural gas 
processing segments of the oil and natural gas sector, if the PTE for 
such sources is equal to or greater than the corresponding minor NSR 
threshold, such sources must instead comply with the requirements of 
Sec. Sec.  49.101 to 49.105, unless the owner/operator of the source 
opts-out of the FIP pursuant to Sec.  49.101(b)(2) or is otherwise 
required by the EPA to obtain a minor source permit pursuant to Sec.  
49.101(b)(3).
    Finally, we are revising Sec. Sec.  49.160(c)(1)(ii) and (iii), 
adding Sec.  49.160(c)(1)(iv) and revising Sec.  49.160(c)(4). For 
Sec.  49.160(c)(1)(ii), we are revising the provision to clarify 
requirements for oil and natural gas activities with respect to the 
registration deadline that conforms with the permitting deadline in 
Sec.  49.151(c)(1)(iii)(B). For Sec.  49.160(c)(1)(iii), we are 
revising the language to indicate that if your true minor source is an 
oil and natural gas source, and you commence construction or 
modification of your source on or after October 3, 2016,\19\ you must 
report your source's actual emissions (if available) as part of your 
permit application (source-specific permits), unless you are subject to 
the FIP. (If you are subject to the FIP, then you must register your 
oil and natural gas source pursuant to Sec.  49.160(c)(1)(iv).) For 
source-specific oil and natural gas source permittees, your permit 
application will be used to fulfill the registration requirements 
described in Sec.  49.160(c)(2).
---------------------------------------------------------------------------

    \19\ In the proposed FIP action, we had proposed to extend the 
registration form from the then applicable date of March 2, 2016, to 
October 3, 2016. We have since finalized amendments to extend the 
permitting compliance and registration deadlines (``Review of New 
Sources and Modifications in Indian Country: Extension of Permitting 
and Registration Deadlines for True Minor Sources Engaged in Oil and 
Natural Gas Production in Indian Country,'' U.S. Environmental 
Protection Agency, 81 FR 9109, February 24, 2016, https://www.gpo.gov/fdsys/pkg/FR-2016-02-24/pdf/2016-03623.pdf).
---------------------------------------------------------------------------

    We are adding Sec.  49.160(c)(1)(iv) to indicate that sources 
subject to the FIP must still satisfy the requirement to register under 
the Federal Indian Country Minor NSR rule by using the two registration 
forms provided by the EPA \20\ rather than a permit application. The 
registration form contains the information required in Sec.  
49.160(c)(2). Minor sources complying with the FIP for the oil and 
natural gas production and natural gas processing segments of the oil 
and natural gas sector, must submit the Part 1 Registration Form that 
contains the information in Sec.  49.160(c)(2) 30 days prior to 
beginning construction. The Part 2 Registration Form must be submitted 
within 60 days after the startup of production as defined in Sec.  
49.152(d). The source must determine the potential for emissions within 
30 days after startup of production. The combination of the Part 1 and 
Part 2 Registration Form submittals satisfies the requirements in Sec.  
49.160(c)(2). The forms are submitted instead of the application form 
otherwise required in Sec.  49.160(c)(1)(iii). After being reviewed by 
the permitting authority, completed registration forms will be 
available online on the appropriate EPA Regional Office Web site.
---------------------------------------------------------------------------

    \20\ The registration forms are available at: https://www.epa.gov/tribal-air/tribal-minor-new-source-review or from the 
EPA Regional Offices.
---------------------------------------------------------------------------

    For Sec.  49.160(c)(4), we are adding language indicating that 
submitting a registration form does not relieve a source of the 
requirement to comply with the FIP for the oil and natural gas 
production and natural gas processing segments of the oil and natural 
gas sector if the source or any physical or operational change at the 
source would be subject to any minor or major NSR rule.

III. Background

A. Federal Indian Country Minor NSR Rule

1. What is the Federal Indian Country Minor NSR rule?
    On August 21, 2006, the EPA proposed the regulation: ``Review of 
New Sources and Modifications in Indian Country'' (commonly referred to 
as the Federal Indian Country NSR rule).\21\ Within this proposed 
regulation, the EPA proposed to protect air quality in Indian country, 
as defined in 18 U.S.C. 1151, by establishing a FIP program to 
regulate, among other matters, the modification and construction of 
minor stationary sources consistent with the requirements of section 
110(a)(2)(c) of the CAA. We refer to this part of the Federal Indian 
Country NSR rule as the Federal Indian Country Minor NSR rule. Under 
the Federal Indian Country Minor NSR rule, we proposed to fill a 
regulatory gap and provide a mechanism for issuing pre-construction 
permits for the construction of new minor sources and certain 
modifications of major and minor sources in Indian country. We 
promulgated final rules on July 1, 2011,\22\ and the FIP became 
effective on August 30, 2011.
---------------------------------------------------------------------------

    \21\ ``Review of New Sources and Modifications in Indian 
Country,'' U.S. Environmental Protection Agency, 71 FR 48696, August 
21, 2006, https://www.gpo.gov/fdsys/pkg/FR-2006-08-21/pdf/06-6926.pdf.
    \22\ ``Review of New Sources and Modifications in Indian 
Country,'' U.S. Environmental Protection Agency, 76 FR 38748, July 
1, 2011, https://www.gpo.gov/fdsys/pkg/FR-2011-07-01/pdf/2011-14981.pdf.
---------------------------------------------------------------------------

    The Federal Indian Country Minor NSR rule applies to new and 
modified minor stationary sources and to minor modifications at 
existing major stationary sources located in Indian country where there 
is no EPA-approved program in place for all new and modified minor 
sources (minor sources) and minor modifications at major sources 
located in areas covered by the Federal Indian Country Minor NSR rule.
    Tribes can elect to develop and implement their own EPA-approved 
program under the Tribal Authority Rule,\23\ but they are not required 
to do

[[Page 35951]]

so.\24\ In the absence of an approved tribal program, the EPA 
implements this program. Alternatively, tribes can take delegation of 
the program from the EPA to assist the EPA with administration of the 
federal program, including acting as the Reviewing Authority for the 
EPA.
---------------------------------------------------------------------------

    \23\ To obtain eligibility to develop and implement an EPA-
approved plan, under the Tribal Authority Rule a tribe must meet 
four requirements: (1) Be a federally-recognized tribe, (2) have a 
functioning government, (3) have the legal authority and (4) have 
the capacity to run the program. For more information go to: 
``Indian Tribes: Air Quality Planning and Management,'' U.S. 
Environmental Protection Agency, 63 FR 7254, February 12, 1998, 
http://www.gpo.gov/fdsys/pkg/FR-1998-02-12/pdf/98-3451.pdf.
    \24\ Under tribal law, tribes may also be able to establish 
permit fees under a tribal permitting program, as do most states.
---------------------------------------------------------------------------

    Beginning September 2, 2014, any new stationary sources, other than 
true minor sources in the oil and natural gas sector, that will emit, 
or will have the potential to emit, a regulated NSR pollutant in 
amounts that will be: (a) Equal to or greater than the minor NSR 
thresholds established in the Federal Indian Country Minor NSR rule; 
and (b) less than the amount that would qualify the source as a major 
source or a major modification for purposes of the PSD or nonattainment 
major NSR programs, must apply for and obtain a minor NSR permit before 
beginning construction of the new source. Likewise, any existing 
stationary source (minor or major) must apply for and obtain a minor 
NSR permit before beginning construction of a physical or operational 
change that will increase the allowable emissions of the stationary 
source by more than the specified threshold amounts, if the change does 
not otherwise trigger the permitting requirements of the PSD or 
nonattainment major NSR program(s).\25\
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    \25\ A source may, however, be subject to certain monitoring, 
recordkeeping and reporting (MRR) requirements under the major NSR 
programs, if the change has a reasonable possibility of resulting in 
a major modification. A source may be subject to both the Federal 
Indian Country Minor NSR rule and the reasonable possibility MRR 
requirements of the major NSR program(s).
---------------------------------------------------------------------------

    Among other things, the Federal Indian Country Minor NSR rule 
created a framework for the EPA to streamline the issuance of pre-
construction permits to true minor sources by using general permits.
2. What is a true minor source and how does it differ from a synthetic 
minor source?
    The designation of a source for the FIP applicability is dependent 
on the source's PTE. Per Sec.  52.21(b)(4), PTE means the maximum 
capacity of a stationary source to emit a pollutant under its physical 
and operational design. Any physical or operational limitation on the 
capacity of the source to emit a pollutant, including air pollution 
control equipment and restrictions on hours of operation or on the type 
or amount of material combusted, stored, or processed, shall be treated 
as part of its design if the limitation or the effect it would have on 
emissions is federally enforceable. Secondary emissions do not count in 
determining the potential to emit of a stationary source.
    ``True minor source,'' under the Federal Indian Country Minor NSR 
rule means a source that emits, or has the potential to emit, regulated 
NSR pollutants in amounts that are less than the major source 
thresholds under either the PSD Program at Sec.  52.21, or the Federal 
Major NSR Program for Nonattainment Areas in Indian Country at 
Sec. Sec.  49.166-49.173, but equal to or greater than the minor NSR 
thresholds in Sec.  49.153, without the need to take an enforceable 
restriction to reduce its PTE to such levels. A source's PTE includes 
fugitive emissions, to the extent that they are quantifiable, only if 
the source belongs to one of the 28 source categories listed in part 
51, appendix S, paragraph II.A.4(iii) or Sec.  52.21(b)(1)(iii) of 40 
CFR, as applicable.
    By contrast, ``synthetic minor source'' means a source that 
otherwise has the potential to emit regulated NSR pollutants in amounts 
that are at or above those thresholds for major sources, but that has 
voluntarily taken a restriction so that its PTE is less than such 
amounts. Such restrictions must be enforceable as a legal and practical 
matter.
3. What is a general permit?
    A general permit, for purposes of this action, is a permit document 
that contains standardized requirements that multiple stationary 
sources can use. The Federal Indian Country Minor NSR rule specifies 
the process and requirements for using general permits to authorize 
construction and modifications at minor sources as a streamlined 
permitting approach. The EPA may issue a general permit for categories 
of emissions units or stationary sources that are similar in nature, 
have substantially similar emissions, and would be subject to the same 
or substantially similar permit requirements.\26\ ``Similar in nature'' 
refers to size, processes, and operating conditions. The purpose of a 
general permit is to protect air quality while simplifying the 
permitting process for similar minor sources. General permits offer a 
cost-effective means of issuing permits and provide a quicker and 
simpler mechanism for permitting minor sources than the source-specific 
permitting process.
---------------------------------------------------------------------------

    \26\ ``Review of New Sources and Modifications in Indian 
Country,'' U.S. Environmental Protection Agency, 76 FR 38770, July 
1, 2011, https://www.gpo.gov/fdsys/pkg/FR-2011-07-01/pdf/2011-14981.pdf.
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    The final Federal Indian Country Minor NSR rule contemplated 
issuance of general permits by the EPA Regional Offices.\27\ While to 
date the general permits that we have issued have been national in 
scope, we will issue general permits on a different geographic scale as 
appropriate.\28\
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    \27\ If a tribe develops an EPA-approved implementation plan, 
then under that plan it could also issue its own general permits.
    \28\ We may in the future issue general permits on a smaller 
geographic scale for a particular state or region of the country. In 
fact, in the first batch of streamlined permits we issued in May 
2015, we indicated that EPA Region 9 will be developing a general 
permit or permit by rule for areas within California for gasoline 
dispensing facilities. In addition, once the EPA issues a general 
permit at the national level, Regional Offices serving as Reviewing 
Authority do grant coverage under nationally-issued general permits 
(as well as any general permits issued by that region for a smaller 
geographic area). See ``General Permits and Permits by Rule for the 
Federal Minor New Source Review Program in Indian Country for Five 
Source Categories,'' U.S. Environmental Protection Agency, 80 FR 
25068, May 1, 2015, http://www.gpo.gov/fdsys/pkg/FR-2015-05-01/pdf/FR-2015-05-01-FrontMatter.pdf.
---------------------------------------------------------------------------

B. What is a FIP?

    In our proposed rule of September 18, 2015,\29\ we discussed the 
concept of a FIP, including our authority to issue FIPs, at great 
length. There are no currently approved Tribal Implementation Plans 
(TIPs) that require the issuance of pre-construction permits designed 
to reduce emissions related to oil and natural gas facilities. As a 
result, the Federal Indian Country Minor NSR rule serves this purpose. 
We have concluded that the issuance of source-specific permits to 
sources in the oil and natural gas production and natural gas 
processing segments of the oil and natural gas sector has the potential 
to overwhelm the system. We initially considered issuing a general 
permit or permit by rule for these sources, but ultimately concluded 
that the issuance of a FIP would be a more effective way of addressing 
the situation for a few reasons. Both a general permit and a permit by 
rule provide a more streamlined approach for authorizing construction 
and modification of a source compared to site-specific permitting. 
However, a general permit still requires a source to submit an 
application and to obtain approval of coverage from the Reviewing 
Authority before beginning construction, and would, thus, pose a 
resource burden on reviewing authorities associated with processing the 
potentially large volume of requests from true minor sources in

[[Page 35952]]

the oil and natural sector for coverage. So, from those standpoints a 
FIP is preferable to a general permit. In comparing a permit by rule to 
a FIP, the EPA prefers the FIP because it provides more certainty for 
affected sources than the permit by rule approach and, as discussed 
below, does not have any significant disadvantages as compared to the 
permit by rule approach.\30\
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    \29\ ``Review of New Sources and Modifications in Indian 
Country: Federal Implementation Plan for Managing Air Emissions from 
True Minor Sources Engaged in Oil and Natural Gas Production in 
Indian Country,'' U.S. Environmental Protection Agency, 81 FR 56554, 
September 18, 2015, https://www.gpo.gov/fdsys/pkg/FR-2015-09-18/pdf/2015-21025.pdf.
    \30\ For a further discussion comparing these three options, 
see: ``Review of New Sources and Modifications in Indian Country: 
Federal Implementation Plan for Managing Air Emissions from True 
Minor Sources Engaged in Oil and Natural Gas Production in Indian 
Country,'' U.S. Environmental Protection Agency, 81 FR 56554, 
September 18, 2015, https://www.gpo.gov/fdsys/pkg/FR-2015-09-18/pdf/2015-21025.pdf.
---------------------------------------------------------------------------

    We believe a FIP is the most appropriate way of implementing the 
Federal Indian Country Minor NSR rule in that it protects air quality 
while at the same time reducing the impact on the Reviewing Authority 
arising from the issuance of source-specific permits for these sources. 
(The FIP also reduces the burden on industry and other interested 
stakeholders.) Therefore, in this final action, we have determined that 
it is necessary or appropriate to exercise our discretionary authority 
under sections 301(a) and 301(d)(4) of the CAA and Sec.  49.11(a) to 
protect air quality by promulgating a FIP applicable to true minor 
sources in the oil and natural gas production and natural gas 
processing segments of the oil and natural gas sector in areas covered 
by the Federal Indian Country Minor NSR rule where there is no EPA-
approved program in place that contains legally and practicably 
enforceable requirements to control and reduce air emissions from such 
sources.

C. Oil and Natural Gas Sector

    In our proposed rule of September 18, 2015, we provided background 
on the oil and natural gas sector. For a more complete description of 
the sector, the reader should consult the Advance Notice of Proposed 
Rulemaking (ANPR) we issued in June 2014.\31\
---------------------------------------------------------------------------

    \31\ ``Managing Emissions from Oil and Natural Gas Production in 
Indian Country,'' U.S. Environmental Protection Agency, 79 FR 32502, 
June 5, 2014, http://www.gpo.gov/fdsys/pkg/FR-2014-06-05/pdf/2014-12951.pdf.
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    The oil and natural gas sector includes operations involved in the 
extraction and production of oil and natural gas, as well as the 
processing, transmission and distribution of natural gas. Specifically 
for oil, the sector includes all operations from the well to the point 
of custody transfer to an oil transmission pipeline or other means of 
transportation to a petroleum refinery. For natural gas, the sector 
includes all operations from the well to the final end user. The oil 
and natural gas sector can generally be separated into four segments: 
(1) Oil and natural gas production; (2) natural gas processing; (3) 
natural gas transmission and storage; and (4) natural gas distribution.

D. EPA Actions Affecting Oil and Natural Gas Minor Sources in Areas 
Covered by the Federal Indian Country Minor NSR Rule

1. Extension of Permitting Compliance and Registration Deadlines
    On January 14, 2014, the EPA published a proposed rule, ``General 
Permits and Permits by Rule for the Federal Minor New Source Review 
Program in Indian Country,'' \32\ that included two proposed amendments 
that affected true minor sources in the oil and natural gas sector. The 
proposed amendments were: (1) The extension of the deadline by which 
new true minor sources and minor modifications of existing true minor 
sources in the oil and natural gas sector must receive minor NSR 
permits prior to commencing construction, from September 2, 2014, to 
March 2, 2016; and (2) an adjustment to the deadline by which existing 
true minor sources in the oil and natural gas sector must register, 
from September 2, 2014, to March 2, 2016. On June 16, 2014, the EPA 
finalized those amendments as proposed.\33\ On September 18, 2015, the 
EPA proposed to extend these dates further to October 3, 2016.\34\
---------------------------------------------------------------------------

    \32\ ``General Permits and Permits by Rule for the Federal Minor 
New Source Review Program in Indian Country,'' U.S. Environmental 
Protection Agency, 79 FR 2546, January 14, 2014, http://www.gpo.gov/fdsys/pkg/FR-2014-01-14/pdf/2013-30345.pdf.
    \33\ For more information, see: ``Review of New Sources and 
Modifications in Indian Country Amendments to the Registration and 
Permitting Deadlines for True Minor Sources,'' U.S. Environmental 
Protection Agency, 79 FR 34231, June 16, 2014, http://www.gpo.gov/fdsys/pkg/FR-2014-06-16/pdf/2014-14030.pdf.
    \34\ ``Review of New Sources and Modifications in Indian 
Country: Federal Implementation Plan for Managing Air Emissions from 
True Minor Sources Engaged in Oil and Natural Gas Production in 
Indian Country,'' U.S. Environmental Protection Agency, 81 FR 56554, 
September 18, 2015, https://www.gpo.gov/fdsys/pkg/FR-2015-09-18/pdf/2015-21025.pdf.
---------------------------------------------------------------------------

    On February 24, 2016,\35\ we finalized three amendments to the 
Federal Indian Country Minor NSR rule that we had proposed at the same 
time as the FIP and the other amendments we are finalizing in this 
action. The amendments are:
---------------------------------------------------------------------------

    \35\ As noted above, we have already finalized amendments to 
extend the permitting compliance and registration deadlines 
(``Review of New Sources and Modifications in Indian Country: 
Extension of Permitting and Registration Deadlines for True Minor 
Sources Engaged in Oil and Natural Gas Production in Indian 
Country,'' U.S. Environmental Protection Agency, 81 FR 9109, 
February 24, 2016, https://www.gpo.gov/fdsys/pkg/FR-2016-02-24/pdf/2016-03623.pdf).
---------------------------------------------------------------------------

    First, we revised the deadline under Sec.  49.151(c)(1)(iii)(B) by 
which new and modified true minor sources in the oil and natural gas 
production and natural gas processing segments of the oil and natural 
gas sector that are located in (or planning to locate in) reservation 
areas of Indian country or other areas of Indian country for which 
tribal jurisdiction has been demonstrated, must obtain a minor NSR 
permit prior to beginning construction. We extended the deadline from 
March 2, 2016, to October 3, 2016, for all true minor sources (both new 
and modified true minor sources) \36\ within the oil and natural gas 
sector located in Indian country.
---------------------------------------------------------------------------

    \36\ The preamble in the February 24, 2016 Federal Register 
notice mistakenly indicates that the extension also applies to minor 
modifications at major oil and natural gas sources; this was an 
error. The rule language itself correctly indicates that the 
extension applies to only new and modified true minor oil and 
natural gas sources.
---------------------------------------------------------------------------

    Second, we revised Sec.  49.151(c)(1)(iii)(A) to conform the 
registration deadline to the extended permitting deadline in Sec.  
49.151(c)(1)(iii)(B).
    Finally, we revised Sec.  49.160(c)(1)(ii) to conform the 
registration deadline to the extended permitting deadline in Sec.  
49.151(c)(1)(iii)(B).
2. Advance Notice of Proposed Rulemaking
    On June 5, 2014, the EPA published an advance notice of proposed 
rulemaking (ANPR).\37\ The purpose of the ANPR was to solicit broad 
feedback on the most effective and efficient means of implementing the 
Federal Minor NSR Program in Indian Country for sources in the 
production segment of the oil and natural gas sector. In it, we 
discussed alternatives to source-specific permits for new and modified 
minor sources engaged in oil and natural gas production activities. The 
EPA requested comments on the alternative approaches and other aspects 
of managing air emissions from oil and natural gas sources in areas 
covered by the Federal Indian Country Minor NSR rule.
---------------------------------------------------------------------------

    \37\ For more information, see: ``Managing Emissions from Oil 
and Natural Gas Production in Indian Country,'' U.S. Environmental 
Protection Agency, 79 FR 32502, June 5, 2014, http://www.gpo.gov/fdsys/pkg/FR-2014-06-05/pdf/2014-12951.pdf.

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[[Page 35953]]

3. Proposed FIP and Associated Amendments
    On September 18, 2015, the EPA proposed a FIP \38\ that would apply 
to new true minor sources and minor modifications at existing true 
minor sources in the production segment of the oil and natural gas 
sector that are locating or expanding areas covered by the Federal 
Indian Country Minor NSR rule. We said that the FIP would satisfy the 
minor source permitting requirement under the Federal Indian Country 
Minor NSR rule. The proposed FIP proposed to require compliance with 
emission limitations and other requirements from six federal emission 
standards as written at the time of construction or modification for 
compression ignition and spark ignition engines, compressors 
(reciprocating and centrifugal), fuel storage tanks, fugitive emissions 
from well sites and compressor stations, glycol dehydrators, 
hydraulically fractured oil and natural gas well completions, pneumatic 
controllers in production, pneumatic pumps, process heaters and storage 
vessels.
---------------------------------------------------------------------------

    \38\ ``Review of New Sources and Modifications in Indian 
Country: Federal Implementation Plan for Managing Air Emissions from 
True Minor Sources Engaged in Oil and Natural Gas Production in 
Indian Country,'' U.S. Environmental Protection Agency, 81 FR 56554, 
September 18, 2015, https://www.gpo.gov/fdsys/pkg/FR-2015-09-18/pdf/2015-21025.pdf.
---------------------------------------------------------------------------

    The EPA also proposed several amendments to the Federal Indian 
Country Minor NSR rule, including adding new text regarding the purpose 
of the program, revising the program overview provision, establishing a 
compliance deadline of October 3, 2016 for all true minor sources (both 
new and modified true minor sources) within the oil and natural gas 
sector, revising certain provisions to incorporate compliance with the 
FIP, revising the applicability provision to establish that sources are 
required to comply with the FIP unless they opt to obtain a source-
specific permit or are otherwise required to obtain a source-specific 
permit, and revising the source registration provision. Also, we 
proposed to revise the definition of Indian country for purposes of the 
rule to comport with a court decision that addressed the scope of the 
EPA's jurisdiction to implement the Federal Indian Country Minor NSR 
rule: ODEQ v. EPA. This court decision also affects the scope of the 
EPA's jurisdiction under the Federal Nonattainment Major NSR Program in 
Indian Country so we proposed changing the definition under the Federal 
Indian Country Nonattainment Major NSR rule as well.
4. Other Oil and Natural Gas Actions
    On September 18, 2015, the EPA proposed updates to the NSPS for the 
oil and natural gas sector.\39\ The proposed FIP would adopt the 
standards from six federal rules, including the oil and natural gas 
NSPS. Changes to these rules would affect requirements in the FIP 
because the proposed FIP would adopt all or parts of these six federal 
emission standards, including future amendments. In addition, on 
September 18, 2015, the EPA proposed an oil and natural gas source 
determination rule.\40\ This action is also connected to this FIP as it 
would affect how oil and natural gas sources are defined for the 
purpose of major/minor source determinations.
---------------------------------------------------------------------------

    \39\ ``Oil and Natural Gas Sector: Emission Standards for New 
and Modified Sources,'' U.S. Environmental Protection Agency, 80 FR 
56593, September 18, 2015, https://www.gpo.gov/fdsys/pkg/FR-2015-09-18/pdf/2015-21023.pdf.
    \40\ ``Source Determination for Certain Emission Units in the 
Oil and Natural Gas Sector,'' U.S. Environmental Protection Agency, 
80 FR 56579, September 18, 2015, https://www.gpo.gov/fdsys/pkg/FR-2015-09-18/pdf/2015-21026.pdf.
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IV. Summary of Final Action, Comments and Responses

A. Overview of Changes to the FIP and Federal Indian Country Minor NSR 
Rule

    The purpose of this section is to provide an overview of key 
aspects of our September 2015 proposed rule, our final action, and 
relevant comments and our responses. The EPA received numerous 
thoughtful and helpful comments on the proposal. After careful 
consideration of this input, we are finalizing the FIP with some 
changes. Overall, here are what we consider to be the most significant 
changes we are making in this final rule. These changes are discussed 
in greater detail below (except as noted):
    (1) Amending the Federal Indian Country Minor NSR rule in several 
ways, including:
    a. Amending Sec. Sec.  49.152 and 49.160 of the Federal Indian 
Country Minor NSR rule to provide for a two-part source registration 
process, including adding a definition to Sec.  49.152(d) for ``Startup 
of production'' that was not proposed but which is necessary to 
accommodate the modified registration process;
    b. Amending Sec. Sec.  49.151 and 49.160 of the Federal Indian 
Country Minor NSR rule to clarify how these provisions relate to the 
FIP, including adjusting references to the oil and natural gas sector 
so that the provisions being amended function properly with respect to 
that sector and the final FIP and to reflect the expanded source scope 
of the final FIP;
    c. Amending Sec. Sec.  49.151 and 49.152 (and Sec. Sec.  49.166 and 
49.167) to update the applicability of the Federal Indian Country Minor 
NSR rule (and Federal Indian Country Nonattainment Major NSR rule) to 
comport with a court decision that addressed the scope of the EPA's 
jurisdiction to implement the Federal Indian Country Minor NSR rule: 
ODEQ v. EPA; and
    d. Amending Sec.  49.160 to clarify that, after October 3, 2016, 
sources engaged in oil and natural gas activity not subject to the FIP 
will use their source-specific permit applications for registration 
(instead of a registration form);
    (2) Modifying the draft source registration form that we provided 
for comment at proposal to:
    a. Provide for a two-part source registration process, including 
making clear that the Part 1 Registration Form is due 30 days prior to 
beginning construction and that the Part 2 Registration Form is due 
within 60 days after the startup of production (as defined in Sec.  
49.152(d)); \41\
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    \41\ We also make it clear in the Part 2 Registration Form that 
sources must determine their potential emissions within 30 days 
after startup of production.
---------------------------------------------------------------------------

    b. Clarify what emissions-related information is required for 
submittal as part of the Part 2 Form registration process;
    c. Clarify that fuel usage and production rates should be provided 
on an annual basis;
    d. Removed the request for emissions and other information for 
hazardous air pollutants, which are not regulated by the Federal Indian 
Country Minor NSR rule;
    e. Provide a Confidential Business Information disclaimer;
    f. Clarify how sources should provide documentation that they are 
meeting the threatened and endangered species and historic properties 
criteria under Sec.  49.104 along with the registration form; and
    g. Condense and reorganize the request for emissions information to 
make it clearer to the source;
    (3) Providing guidance that we intend to potentially apply this 
national FIP's requirements as appropriate to nonattainment areas where 
the EPA has established a separate, area-specific FIP;
    (4) Changing the FIP as proposed in several areas:
    a. Modifying Sec.  49.101 to change ``oil and natural gas 
production facility'' to ``oil and natural gas source'' and also 
clearly linking the modified wording to the reworded definition of oil 
and natural gas source in Sec.  49.102;

[[Page 35954]]

    b. Replacing the definition of oil and natural gas production 
facility in Sec.  49.102 with oil and natural gas source, which also 
includes natural gas processing, but excludes natural gas transmission 
and distribution;
    c. Expanding the scope of the FIP by revising Sec. Sec.  49.101 and 
49.102 to cover non-major gas processing plants and the definition of 
oil and natural gas source;
    d. Adding a subparagraph to Sec.  49.101 to make it clear that the 
FIP does not apply to minor modifications at major sources;
    e. Rewording Sec.  49.104 to specify the information that is 
acceptable to document that a source has addressed threatened and 
endangered species and historic properties;
    f. Expanding Sec.  49.104 to add the process the Reviewing 
Authority will use to determine whether the screening procedures 
provided to the EPA have been satisfactorily completed to address 
threatened and endangered species and historic properties;
    g. Expanding Sec.  49.105 to add two federal standards to the FIP's 
requirements:
    i. 40 CFR part 63, subpart ZZZZ--NESHAP for Stationary 
Reciprocating Internal Combustion Engines; and
    ii. 40 CFR part 60, subpart KKKK--Standards of Performance for New 
Stationary Combustion Turbines;
    h. Adjusting exclusions from this FIP for the following two 
standards under Sec.  49.105 to reflect the expansion of the scope of 
the FIP to natural gas processing plants (not discussed below--instead, 
see Section II.B.):
    i. 40 CFR part 60, subpart IIII--Standards of Performance for 
Stationary Compression Ignition Internal Combustion Engines;
    ii. 40 CFR part 60, subpart OOOOa--Standards of Performance for 
Crude Oil and Natural Gas Facilities for which Construction, 
Modification, or Reconstruction Commenced after September 18, 2015; and
    iii. 40 CFR part 63, subpart HH--NESHAP from Oil and Natural Gas 
Production Facilities; and
    i. Clarifying under Sec.  49.105 that the FIP applies not just to 
true minor sources but to minor modifications at true minor sources as 
well.

B. Proposed Amendments to the Federal Indian Country Minor NSR Rule

1. Proposed Rule
    The EPA proposed amendments to the Federal Indian Country Minor NSR 
rule, including adding new text regarding the purpose of the program, 
revising the program overview provision, establishing a compliance 
deadline of October 3, 2016 for all true minor sources (both new and 
modified true minor sources) within the oil and natural gas sector, 
revising certain provisions to incorporate compliance with the FIP, 
revising the applicability provision to establish that sources are 
required to comply with the FIP unless they opt to obtain a source-
specific permit or are otherwise required to obtain a source-specific 
permit, and revising the source registration provision. Also, we 
proposed to revise the definition of Indian country for purposes of the 
rule to comport with a court decision that addressed the scope of the 
EPA's jurisdiction to implement the Federal Indian Country Minor NSR 
rule: ODEQ v. EPA. This court decision also affects the scope of the 
EPA's jurisdiction under the Federal Major NSR Program in Indian 
Country, so we proposed to change the definition under the Federal 
Indian Country Nonattainment Major NSR rule as well.
2. Final Action
    As mentioned in Section III.D., we have already finalized three 
amendments to extend the permitting compliance and registration 
deadlines for true minor sources in the oil and natural gas sector.\42\ 
In today's action, we are finalizing the remainder of the amendments as 
described in Section II.D., as proposed, with five exceptions:
---------------------------------------------------------------------------

    \42\ ``Review of New Sources and Modifications in Indian 
Country: Extension of Permitting and Registration Deadlines for True 
Minor Sources Engaged in Oil and Natural Gas Production in Indian 
Country,'' U.S. Environmental Protection Agency, 81 FR 9109, 
February 24, 2016, https://www.gpo.gov/fdsys/pkg/FR-2016-02-24/pdf/2016-03623.pdf.
---------------------------------------------------------------------------

    First, we are amending Sec. Sec.  49.151, 49.153 and 49.160 of the 
Federal Indian Country Minor NSR rule to clarify how these provisions 
relate to the FIP, including adjusting references to the oil and 
natural gas sector so that the provisions being amended function 
properly with respect to that sector and the final FIP and to reflect 
the expanded source scope of the final FIP.
    Second, we are revising Sec.  49.160(c)(1)(iii) and (iv) as 
proposed by adding further revisions to provide for a modified, two-
part registration process under the Federal Indian Country Minor NSR 
rule for sources covered by this FIP. We are also modifying the oil and 
natural gas registration form as made available at proposal by 
splitting the form into two forms to provide for the two-part source 
registration process, requiring emissions information from sources 
after production is started. The changes are described above in Section 
IV.A.
    Third, associated with that change, we are adding a definition to 
Sec.  49.152(d) for ``Startup of production'' that was not proposed but 
which is necessary to accommodate the modified registration process.
    Fourth, we are amending Sec.  49.160(c)(1)(iii) to clarify that, 
after October 3, 2016, sources engaged in oil and natural gas activity 
not subject to the FIP will use their source-specific permit 
applications for registration (instead of a registration form).
    Finally, we are amending Sec. Sec.  49.151(c)(1) and 49.152(d) (and 
Sec. Sec.  49.166(c)(1) and 49.167) to update the applicability of the 
Federal Indian Country Minor NSR rule and Federal Indian Country 
Nonattainment Major NSR rule, respectively, to comport with a court 
decision that addressed the scope of the EPA's jurisdiction to 
implement the Federal Indian Country Minor NSR rule: ODEQ v. EPA.
3. Comments and Responses
    The following discussion contains comments on the proposed 
amendments to the Federal Indian Minor NSR rule and our responses. The 
comments and responses are also addressed in Section 1.0 of the 
Response to Comment (RTC) Document.
(a) Pre-Construction Permit Requirements
    Comment #1: Five commenters expressed concern about the proposed 
pre-construction requirements and the difficulty in determining PTE 
before a well starts production due to the unpredictable nature of well 
development and productivity. Two commenters stated the requirement is 
burdensome and would lead to inaccurate data due to the unpredictable 
nature of oil and natural gas production.
    Several commenters thought that pre-construction estimated 
emissions would be of limited value to the EPA and would create 
confusion for the public once released or used in modeling the effects 
of oil and natural gas production. One commenter noted that the pre-
construction requirements limit the usefulness of the proposed FIP 
because owners/operators will not have definitive source-specific 
information before production begins.
    One commenter requested that if the EPA were to retain the pre-
construction requirements, then the EPA should provide a mechanism for 
revising emissions estimates after actual emissions are known.
    Several commenters pointed to rules or state permitting programs 
that require post-construction information to be submitted, rather than 
pre-construction.

[[Page 35955]]

For example, the Federal Indian Country Minor NSR rule requires 
operators to submit registration forms within 90 days of initial 
production. Several commenters pointed to state requirements, which 
acknowledge the unique challenges of permitting well production sites. 
Wyoming allows operation prior to permitting as long as the operator 
satisfies certain emission control requirements. In Colorado, emissions 
information is not required to be submitted until after drilling, 
workovers, completions, and testing are completed. North Dakota also 
has owners/operators submit the oil and natural gas well registration 
form within 90 days of completion of a well. Commenters believe that 
providing information after the well begins production will conserve 
EPA resources and provide the EPA with more accurate information, as 
well as align permitting processes on Indian lands with state 
permitting processes on adjacent lands.
    As an alternative to pre-construction information, two commenters 
suggested that the EPA allow owners/operators to provide actual 
emissions data based on the first 30 days of production, due to the EPA 
90 days after startup, similar to 40 CFR part 60, subpart OOOO.
    As another alternative to providing pre-construction information, 
one commenter suggested a two-part approach:
    Part 1: 30 days prior to the anticipated first date of production, 
submit owner/operator information, well location description, 
production equipment anticipated to be installed, and the anticipated 
first date of production.
    Part 2: Within 60 days after first date of production, supply 
information on emissions and production rates as part of a notification 
process. The commenter requested 60 days as that date is used as part 
of the mineral rights royalty notification processes under the 
Department of Interior.
    The same commenter submitted revisions to the draft registration 
form that we made available with the September 2015 proposed rule. The 
commenter asked the EPA to remove actual emissions data and to require 
operators to submit projected allowable emissions from the equipment, 
based on the initial production. The commenter stated that if the EPA 
needs to quantify actual emissions, the information will only be 
accurate through an emission inventory, versus using data submitted 
with the permit application, due to the actual emissions decreasing 
over time.
    Response #1: The EPA has revised the Federal Indian Country Minor 
NSR rule and the registration form to incorporate a two-step 
registration process for oil and natural gas true minor sources 
locating or expanding in Indian country, as suggested by commenters. 
Generally, we prefer to receive registration forms complete with source 
and emissions information prior to construction, as we proposed and as 
required in Sec.  49.160 of the Federal Indian Country Minor NSR rule 
for other source categories. However, we recognize the unique nature of 
the oil and natural gas industry and believe in this instance a two-
part registration process is warranted.
    The Part 1 Registration Form will be due 30 days before the source 
begins construction. The Part 2 Registration Form will be due within 60 
days after the ``startup of production,'' in accordance with the 
subpart OOOOa definition of startup of production. (For the Part 2 
Registration Form, we are adding the definition for ``Startup of 
production'' to Sec.  49.152(d), which points directly to the term as 
defined under 40 CFR part 60, subpart OOOOa.) Sources must determine 
the potential for emissions within 30 days after startup of production, 
information which is required as part of the Part 2 Registration Form. 
The EPA has selected 60 days as the submittal date for the Part 2 
Registration Form--the date requested by the commenter--as that 
timeframe will allow sufficent time for sources to assemble the 
emissions information required as part of the the Part 2 Registration 
Form and to submit it to the EPA.
    The control requirements from the eight NSPS and NESHAP standards 
in this FIP will apply during production (the six standards included in 
the original proposal and two standards being added in the final rule). 
The owner/operator must account for emissions from startup of 
production as required in the Part 2 Registration Form submission. We 
disagree with the commenter about the type of emissions information 
that must be submitted with the registration form. Pursuant to Sec.  
49.160 of the Federal Indian Country Minor NSR rule, sources are 
required to submit allowable and actual emissions, not just allowable, 
as requested by the commenter. The owner/operator should calculate an 
estimate of the actual annual emissions using estimated operating 
hours, production rates, in-place control equipment, and types of 
materials processed, stored, or combusted during the upcoming 
consecutive 12 months.
    The source, as documented by an owners/operators should use the 
definition in EPA's rulemaking on ``Source Determination for Certain 
Emission Units in the Oil and Natural Gas Sector'' \43\ in defining 
each source on its registration form.
---------------------------------------------------------------------------

    \43\ ``Source Determination for Certain Emission Units in the 
Oil and Natural Gas Sector,'' signed May 12, 2016, http://www.epa.gov/airquality/oilandgas/actions/html.
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(b) The Definition of Indian Country in Sec.  49.152
    Comment #2: Several commenters expressed concern about the EPA's 
proposed definition change for the term Indian country as used in the 
rule. Two commenters disagreed with the fourth paragraph added to the 
definition of Indian country and noted that the EPA should not be 
vested with power to make determinations or demonstrations about tribal 
jurisdiction and that any such demonstration of jurisdiction should be 
left to the sovereign whose jurisdiction is being asserted. The 
commenters assert that although the EPA has indicated that this should 
only impact trust lands in Oklahoma, tribal allotments would also be 
impacted by the change in definition. One commenter recommended that 
the definition of Indian country include Indian reservation lands for 
which a TIP approved by the EPA pursuant to 40 CFR part 51 is not in 
effect, and over which an Indian tribe has demonstrated that it has 
jurisdiction.
    One commenter stated that the EPA should be cautious of how the 
rule appears. By restating the definition of Indian country in the 
rule, it appears that the EPA is defining the term. Of course, the EPA 
cannot change the definition of Indian country through the proposed 
rule. The term Indian country was defined by Congress in statute. The 
EPA's regulations cannot change or modify this definition. The 
commenter suggested that the EPA should make it clear that Indian 
country is already statutorily defined and simply cross reference the 
relevant statute.
    The commenter further states that the proposed and final rules 
should not state that the EPA is ``revising the definition of Indian 
Country.'' The commenter states that the EPA is doing no such thing. As 
a result of ODEQ v. EPA, the EPA is required to consider how it will 
apply the proposed rule in certain portions of Indian country, but the 
EPA is not revising the definition of Indian country. In other words, 
ODEQ v. EPA is not about the definition of Indian country, but rather 
the process the EPA is using to apply the proposed rule to certain 
parts of Indian country. The commenter recommends that the EPA remove 
all references to revised definitions of Indian country from the 
proposed rule. Rather than purporting to

[[Page 35956]]

revise the definition of Indian country, the commenter suggests that 
the EPA include a new section discussing the applicability of the 
proposed rule.
    Response #2: Regarding the commenters who expressed concern about 
the EPA's proposed changes to the sections of the rule that define 
Indian country, the EPA acknowledges the potential for confusion given 
that Indian country is a statutorily defined term at 18 U.S.C. 1151. We 
note that the EPA did not intend to, nor could we, change or in any way 
affect the statutory definition at 18 U.S.C. 1151 or the manner in 
which that statute is interpreted and applied for other purposes. 
Rather, we intended simply to address a 2014 decision of the D.C. 
Circuit (ODEQ v. EPA) that addressed the scope within Indian country of 
the EPA's authority to administer the Federal Indian Country Minor NSR 
rule--and, thus, the FIP in this action--and the Federal Indian Country 
Nonattainment Major NSR rule.\44\ In that decision, the court 
invalidated the rules as applied to non-reservation areas of Indian 
country, unless the EPA or a tribe demonstrates that a tribe has 
jurisdiciton over such a non-reservation area. The court did not 
disturb application of the rules to Indian reservations. Our intent 
was, thus, not to alter the applicable definition of Indian country, 
but instead to address the scope of applicability of the rules within 
Indian country in light of the D.C. Circuit decision. To avoid 
potential confusion, we have altered the manner in which we are 
addressing this court ruling.
---------------------------------------------------------------------------

    \44\ Oklahoma Dept. of Environmental Quality v. EPA, 740 F.3d 
185 (D.C. Cir. 2014).
---------------------------------------------------------------------------

    In the final rule, we have left the Indian country definitions 
largely intact and simply provided cross-references within the 
definitional sections of both rules--Sec. Sec.  49.152 and 49.167--
stating that the geographic scope of the rules' applicability will be 
as specified in the program overview sections of both rules--Sec. Sec.  
49.151 and 49.166. We have then addressed the limitation imposed by the 
court ruling (i.e., that the rules will only apply in non-reservation 
areas of Indian country where there is a demonstration by a tribe or 
the EPA acting on behalf of a tribe of tribal jurisdiction over such 
area) in the program overview sections, which are more appropriate 
provisions in which to address this issue. These changes do not alter 
the substance of the revisions the EPA had proposed to address the ODEQ 
v. EPA ruling. Instead, they simply move the needed revisions to more 
appropriate locations in the rules, and, thus, avoid confusion about 
the applicable definition of Indian country as a general matter. 
Further, the EPA notes that the regulatory revisions finalized today to 
address the ODEQ v. EPA decision apply solely to the Federal Indian 
Country Minor NSR rule--and, thus, the FIP in today's action--and the 
Federal Indian Country Nonattainment Major NSR rule. They are not 
intended to apply to any other matter outside the scope of these rules.
    In addition, while the EPA acknowledges the commenter's statement 
that an Indian tribe's jurisdiction should not need to be demonstrated 
to exist, the EPA notes that, consistent with the ODEQ v. EPA decision, 
a demonstration of tribal jurisdiction (either by the EPA or by an 
Indian tribe) would need to be made to support application of the 
Federal Indian Country Minor NSR rule in non-reservation areas of 
Indian country.
    The EPA notes that the distinction between reservations and other 
areas that may be under an Indian tribe's jurisdiction (i.e., non-
reservation areas of Indian country) is derived from a CAA tribal-
related provision (CAA section 301(d)(2)(B)). This provision includes a 
delegation of authority from Congress to eligible Indian tribes over 
their reservations, but expressly distinguishes other areas within a 
tribe's jurisdiction. For this reason, tribes seeking to administer 
their own CAA-regulatory programs would need to demonstrate their 
jurisdiction over any non-reservation area included in their 
application.\45\ By virtue of the ODEQ v. EPA decision, such a 
demonstration of tribal jurisdiction must also be made (by a tribe or 
by the EPA) to support application of the Federal Indian Country Minor 
NSR rule in such non-reservation areas of Indian country.
---------------------------------------------------------------------------

    \45\ For more information go to: ``Indian Tribes: Air Quality 
Planning and Management,'' U.S. Environmental Protection Agency, 63 
FR 7254, February 12, 1998, http://www.gpo.gov/fdsys/pkg/FR-1998-02-12/pdf/98-3451.pdf.
---------------------------------------------------------------------------

    Comment #3: Further, concerning the definition of Indian country, 
one commenter disagreed with the EPA's distinction between ``on-
reservation'' and ``off-reservation'' Indian country and contended that 
tribes exercise jurisdiction over these lands through existing tribal 
sovereignty and in accordance with numerous federal programs that 
affirm tribal authorities and tribal self-determination over these 
lands and areas. The commenter contends that the distinction was not 
intended in the CAA and is not consistent with how tribes exercise 
authority over their lands. Nonetheless, the commenter generally 
supports the fourth paragraph added to the definition of Indian 
country, stating that the rule would apply to ``all Indian reservation 
lands where no EPA-approved program is in place and all other areas of 
Indian country where no EPA-approved program is in place and over which 
an Indian tribe, or the EPA, has demonstrated that a tribe has 
jurisdiction.'' However, the commenter does not believe that a tribe's 
jurisdiction has to be ``demonstrated'' to exist.
    Response #3: Regarding the comment on the EPA's distinction between 
``on-reservation'' and ``off-reservation'' Indian country, the EPA 
disagrees with the suggested changes. The EPA's revisions reflect the 
holding in ODEQ v. EPA. The decision acknowledges that either a tribe 
or the EPA can make such a demonstration of tribal jurisdiction over a 
non-reservation area of Indian country. Although the EPA is not 
typically called upon to assess tribal jurisdiction in the context of 
implementing a federal rule, it is appropriate for the EPA to make such 
determinations where required. The EPA has experience reviewing tribal 
jurisdiction in other contexts, most notably where tribes apply to 
administer regulatory programs under the EPA's statutes. In light of 
the ODEQ v. EPA decision, such jurisdictional assessments are also 
relevant for implementing federal permitting under the Federal Indian 
Country Minor NSR rule in non-reservation areas of Indian country.
    Comment #4: One commenter acknowledged the EPA's intent in the 
proposed rulemaking to protect the reservation airsheds, while allowing 
for streamlined permitting of minor oil and natural gas sources, and 
requested that the EPA achieve this goal by developing and implementing 
the rule in a manner that promotes tribal sovereignty, authority, self-
determination and a tribe's ability to develop resources. The commenter 
emphasized that the EPA should develop the proposed rule in a manner 
that recognizes that Indian lands are not public lands.
    Another commenter noted that the EPA appears in the proposed rule 
to understand the concern for the oil and natural gas industry to be on 
tribal lands without tribal authorities having the ability to properly 
regulate the industry on their own. The commenter encouraged the EPA to 
recognize this potential situation while maintaining the tribe's choice 
on who to do business with, as well as retaining the tribe's relative 
autonomy to create their own pollution plans. The commenter 
acknowledged that the EPA's intentions

[[Page 35957]]

in the proposed rule would likely provide better protections than any 
TIP.
    Response #4: The EPA acknowledges that Indian country lands are not 
public lands and has solicited tribal feedback on the development of a 
streamlined permitting process that allows for tribes to develop 
resources on their lands. In doing so, the EPA seeks to protect air 
quality in Indian country, while also recognizing the importance of oil 
and natural gas activity as an important source of revenue for tribes, 
and has developed the FIP accordingly. Moreover, the development of 
this FIP does not preclude tribes from requesting to assist the EPA 
with administration of the FIP through a delegation agreement or from 
developing TIPs, which could include different or additional pollution 
control plans that tribes feel are needed to preserve air quality given 
the unique characteristics of their lands. No changes will be made in 
response to this comment.

C. Implementation-Related Issues

1. Proposed Rule
    In the proposed rule, we discussed the effect of the proposed FIP 
on other Indian Country FIPs.
    The FIP proposed in September 2015 was intended to fulfill the 
requirements of the Federal Indian Country Minor NSR rule to address 
the air quality impacts of new and modified true minor sources and to 
impose appropriate air pollution control requirements that protect the 
NAAQS, while providing an alternative to obtaining source-specific pre-
construction approval through the NSR pre-construction permitting 
process. The proposed FIP was not intended to replace any other FIPs 
promulgated under the CAA for oil and natural gas sector sources in 
areas covered by the Federal Indian Country Minor NSR rule. Under the 
proposed FIP, an oil and natural gas source located in areas covered by 
the Federal Indian Country Minor NSR rule that is subject to another 
CAA FIP would have to continue to comply with that FIP and also have to 
comply with the proposed FIP. Generally, in cases where emission 
sources are already subject to a CAA FIP with more stringent 
requirements than those established for equivalent emission sources 
under the proposed FIP, those sources would be subject to the 
requirements of both FIPs, but those more stringent requirements 
supersede the requirements in this proposed FIP and compliance with the 
more stringent requirements would constitute compliance with both FIPs 
relative to those particular requirements. Conversely, if requirements 
for certain emission sources in the proposed FIP are more stringent 
than requirements for equivalent emission sources in another applicable 
CAA FIP, then those sources would be subject to the requirements of 
both FIPs, but the requirements in the proposed FIP supersede the 
requirements for equivalent emission sources in the other FIP and 
compliance with the more stringent requirements in the FIP would 
constitute compliance with the requirements of both FIPs relative to 
those particular requirements. In the case of the FIP for Oil and 
Natural Gas Well Production Facilities on the Fort Berthold Indian 
Reservation (FBIR FIP) \46\ at Sec. Sec.  49.4161-49.4168,\47\ we defer 
to less stringent requirements in other federal CAA rules to avoid 
duplicative requirements. The FBIR FIP provides an exception to the 
general concept that the more stringent set of requirements govern.
---------------------------------------------------------------------------

    \46\ In the proposed September 2015 FIP, we referred to ``other 
FIPs'' rather than just the FBIR FIP. Upon further review, we 
realize that the FBIR FIP is the only case of a FIP that illustrates 
an exception to the general concept.
    \47\ ``Approval and Promulgation of Federal Implementation Plan 
for Oil and Natural Gas Well Production Facilities; Fort Berthold 
Indian Reservation (Mandan, Hidatsa, and Arikara Nation), North 
Dakota,'' U.S. Environmental Protection Agency, 78 FR 17836, March 
22, 2013, https://www.gpo.gov/fdsys/pkg/FR-2013-03-22/pdf/2013-05666.pdf.
---------------------------------------------------------------------------

    In the September 2015 proposed FIP, we specifically addressed how 
it related to the FBIR FIP. The FBIR FIP is not a permitting program 
and does not exempt facilities from any federal CAA permitting 
requirements, which includes compliance with this FIP. Similarly, the 
proposed oil and natural gas FIP would not exempt facilities from 
complying with the FBIR FIP. The EPA recognizes that the VOC control 
requirements under the FBIR FIP are in some instances more stringent 
than those in the proposed FIP. For example, in the proposed FIP, we 
indicated that a new or modified oil and natural gas well production 
facility that is subject to the FBIR FIP--and also subject to the 
proposed FIP--would still need to comply with the FBIR FIP for casing 
head natural gas emissions and heater treater produced natural gas 
emissions. Requirements for these units were not contained in the 
proposed FIP.
2. Final Action
    In this final action we are not changing our proposal in terms of 
how this FIP relates to other Indian country FIPs. However, there were 
several comments in this area that we are responding to below that 
relate to the proposal.
3. Comments and Responses
    The following discussion contains comments on issues related to the 
FIP and our responses. The comments and responses are also addressed in 
Section 2.0 of the RTC Document.
    Comment #5: One commenter requested that the EPA clarify how 
numerical VOC emission limitations will be applied through compliance 
with 40 CFR part 63, subpart HH, when the subpart has numerous 
compliance options that often do not contain specific numerical 
emission limitations. The commenter noted that the proposed FIP would 
create enforceable VOC emission reductions for glycol dehydrators 
through the requirements of 40 CFR part 63, subpart HH, using HAPs as a 
surrogate for VOCs.
    Response #5: The FIP does not impose a separate VOC limit for 
glycol dehydration units that are subject to 40 CFR part 63, subpart HH 
(i.e., independently of the FIP, the source will have to comply with 
the HAP control requirements, which also effectively control VOC and 
may or may not involve numerical emissions limitations). While the EPA 
recognizes that 40 CFR part 63, subpart HH, specifies several different 
control requirements depending on several factors (e.g., major/area 
source status of the facility, actual natural gas throughput of the 
dehydrators, urban/rural location), any dehydrators subject to those 
standards will satisfy compliance with the FIP for those units by fully 
complying with the MACT standard. We have not made any changes in 
response to this comment.
    Comment #6: One commenter stated that the proposed oil and natural 
gas FIP falls short in meeting several core objectives for permitting 
oil and natural gas sector facilities. The commenter stated that the 
foundation of the proposed FIP is still based on site-specific reviews, 
which by definition will inhibit its streamlining capabilities, and 
that this poses an obstacle to permitting. This could place future oil 
and natural gas development in Indian country at a disadvantage 
compared to more streamlined options available under state 
jurisdictions.
    Response #6: The EPA disagrees that the foundation of the proposed 
FIP is based on source-specific permit reviews. While source-specific 
permits remain an option available to sources that do not wish to 
comply with the FIP, apart from addressing threatened and endangered 
species and historic properties, those sources that do wish to comply 
with the FIP need only register in accordance with the provisions of 
Sec.  49.160(c)(1)(iv).

[[Page 35958]]

This streamlined permitting mechanism allows for sources to begin 
construction 30 days after submittal of the Part 1 registration 
information. We have not made any changes in response to this comment.
    Comment #7: One commenter requested that the EPA clarify how the 
proposed FIP will provide practical enforceability when several of the 
six rules included in the proposed FIP, such as 40 CFR part 63, subpart 
HH, do not contain practically enforceable requirements. The commenter 
noted that, because several of the standards do not contain practically 
enforceable requirements, sources that wish to restrict their PTE will 
be forced to obtain a source-specific permit. The commenter stated that 
the proposed FIP would fail to achieve the objective of providing 
sources a streamlined approach for obtaining legal and practically 
enforceable emission limitations.
    Response #7: A source has to be a true minor source to use the FIP. 
The FIP is not intended to provide a mechanism for establishing 
synthetic minor sources. We have not made any changes in response to 
this comment.
    Comment #8: One commenter (a state agency) noted that North Dakota 
regulations for natural gas capture have been enforced on the Fort 
Berthold Indian Reservation under multiple tax and regulatory 
agreements between the state and tribes. The commenter stated that the 
proposed rule will increase the number and complexity of conflicts with 
North Dakota regulations and the existing negotiated agreements. One 
commenter stated that the proposed rule could have significant impacts 
on their ability to administer their oil and natural gas regulatory 
program, and recommended that the proposed rule recognize and give 
deference to existing state and tribal agreements for natural gas 
permitting and regulation.
    Response #8: The FIP adopted through this final action only applies 
to sources locating in Indian country and does not impose any 
requirements on sources located on state lands. The EPA also notes that 
the State of North Dakota has not been approved by the EPA to 
administer any program under the federal CAA on the Fort Berthold 
Indian Reservation. The EPA notes that there are no new requirements 
included as part of the FIP, only those rules already applicable to oil 
and natural gas sources under existing federal NSPS and NESHAP rules 
are included. We have not made any changes in response to this comment.
    Comment #9: One commenter stated that the Federal Indian Country 
Minor NSR rule and the FIP should provide industry more flexible 
compliance options that are cost effective without compromising 
significant emissions reductions. The commenter suggested that the 
Federal Indian Country Minor NSR rule and the FIP should include an 
early action program, noting that, considering the uncertainty 
surrounding ozone standard designations in the Uinta Basin, an early 
action program would remove the risk for industry investments in 
emission reductions by ensuring appropriate credit for those 
investments. The commenter also suggested that the Federal Indian 
Country Minor NSR rule and the FIP should include an option for 
portfolio-wide emissions compliance, noting that a portfolio-wide 
approach would provide many operators the needed flexibility to more 
efficiently and cost-effectively achieve system-wide emission 
reductions that meet regulatory goals.
    Response #9: Ozone Advance is the early action program that the EPA 
is offering to promote local efforts aimed at reducing ozone.\48\ The 
program, which began in 2012, is available to states, local 
governments, and tribes that are interested in working proactively and 
collaboratively with the EPA to select and implement measures and 
programs that may reduce ozone air quality levels in attainment areas. 
Other stakeholders, such as industry, are encouraged to become actively 
involved in these efforts. Ozone Advance will continue to be available 
in conjunction with the Federal Indian Country Minor NSR rule, this FIP 
and any future, final FIPs developed for specific areas. As 
appropriate, such FIPs could consider portfolio-wide options allowing 
operators to reduce their emissions across entire tribal areas. We have 
not made any changes in response to this comment at this time.
---------------------------------------------------------------------------

    \48\ For more information, go to: www.epa.gov/advance.
---------------------------------------------------------------------------

    Concerning ``credit'', the EPA cannot pre-approve State 
Implementation Plan (SIP)/TIP ``credit'' for emission reductions in 
areas that are not the subject of a nonattainment designation. However, 
early actions to improve air quality can both serve to prevent areas 
from becoming nonattainment and better position an area to comply with 
the requirements associated with an eventual nonattainment designation. 
For example, early emission reduction actions could potentially receive 
``credit'' in future SIPs/TIPs if an area is eventually designated 
nonattainment with a Moderate or higher classification, either in terms 
of reflecting a lower baseline from which additional reductions are 
needed to meet reasonable further progress goals or, if they occur 
after the baseline year, as a measure that shows progress toward 
attainment.
    If emission reductions occur after the baseline year, the area may 
take credit for those reductions subject to CAA requirements, such as 
demonstrating that the reductions are surplus, quantifiable, 
enforceable, and permanent. The state or tribe would also need to meet 
any other relevant requirement in CAA section 110 and/or section 172, 
and if the measure is voluntary, the state or tribe would need to make 
an enforceable commitment to ensure that the estimated emission 
reductions are achieved. Credit earned in this manner means that fewer 
additional emission reductions will be needed to meet reasonable 
further progress goals and to demonstrate attainment, thereby bringing 
the finish line of attainment with the ozone NAAQS closer.

D. Requirements Relating to Threatened or Endangered Species and 
Historic Properties

1. Proposed Rule
    In the proposed rule, we proposed requirements for true minor oil 
and natural gas sources relating to threatened and endangered species 
and historic properties. The Endangered Species Act (ESA) requires 
federal agencies to ensure, in consultation with the U.S. Fish and 
Wildlife Service and/or the National Marine Fisheries Service (the 
Services), that any action they authorize, fund, or carry out will not 
likely jeopardize the continued existence of any listed threatened and 
endangered species, or destroy or adversely modify the designated 
critical habitat of such species. The National Historic Preservation 
Act (NHPA) requires federal agencies to take into account the effects 
of their undertakings on historic properties--i.e., properties that are 
either listed on, or eligible for listing on, the National Register of 
Historic Places--and to provide the Advisory Council on Historic 
Preservation (the Council) a reasonable opportunity to comment on such 
undertakings.
    In developing the proposed FIP, EPA considered issues regarding 
listed species and historic properties and included provisions designed 
to ensure appropriate review of potential impacts on these protected 
resources. Although the individual coverage of each source that would 
operate under the FIP would not constitute a separate triggering

[[Page 35959]]

action for ESA or NHPA purposes, we believe that the proposed FIP's 
procedures relating to listed threatened and endangered species and 
historic properties provide an appropriate site-specific means of 
addressing issues regarding potential impacts on those resources in 
connection with issuance of the FIP and, thus, in connection with 
sources that could be covered under the FIP. We provided two options, 
as follows, for sources to meet the proposed FIP's requirements 
regarding these resources:
    (1) For sources for which a prior ESA and/or NHPA assessment has 
been completed, in the proposed FIP we indicated that, where Federal 
Land Managers (FLMs) have concluded ESA and/or NHPA compliance as part 
of the process in which an oil and natural gas operator makes an 
Application to Drill (APD) in connection with a particular source--
whether as part of the FLM's NEPA review or otherwise--the source would 
be able to rely on that prior review for compliance with the proposed 
FIP's listed species (if prior ESA compliance has occurred) and 
historic properties (if prior NHPA compliance has occurred) 
requirements. No further assessment of impacts on these resources would 
be required by the proposed FIP as any such assessment would be 
duplicative of the prior work conducted by the FLM(s). We would require 
that documentation of completion of the APD process be provided before 
the owner/operator begins construction under the FIP.
    (2) For sources for which no prior ESA and/or NHPA assessment has 
been completed, in the proposed FIP we indicated that those facilities 
must first complete screening procedures relevant to the particular 
resource that have not previously been reviewed before the owner/
operator can begin construction under the proposed FIP. These screening 
procedures are similar to those currently in place for existing general 
permits and permits by rule in areas covered by the Federal Indian 
Country Minor NSR rule that must be completed before the owner/operator 
can begin construction under those general permits and permits by 
rule.\49\ We stated that the review of the screening procedures would 
be similar to our procedure for general permits and permits by rule, 
for the proposed FIP, where once an owner/operator completes the 
screening procedures,\50\ they would submit documentation to the EPA 
Regional Office and receive written verification of completion before 
beginning construction. As we explained in the development of both the 
general permits and permits by rule for the ``General Permits and 
Permits by Rule for the Federal Minor New Source Review Program in 
Indian Country,'' \51\ to ensure listed species and critical habitats 
and historic properties are protected, we developed a framework for 
those permitting mechanisms requiring the source owner/operator to 
identify and assess potential effects on protected resources before 
obtaining coverage. Requiring this assessment aids in identifying any 
concerns related to potential impacts on listed species/critical 
habitat or historic properties early in the process when the greatest 
opportunities to mitigate or avoid any impacts--including changes to 
the facility's location or footprint--are available. The EPA believes 
that requiring a similar process in the air quality permit by rule, the 
general air quality permit, and the proposed FIP will streamline the 
process for all concerned: the applicants, the EPA, the tribes, and any 
resource experts such as the Services or historic preservation 
officers.
---------------------------------------------------------------------------

    \49\ These procedures are available for sources potentially 
subject to this proposed FIP in a document entitled: ``Procedures to 
Address Threatened and Endangered Species and Historic Properties 
for the Federal Implementation Plan for True Minor Sources in Indian 
Country in the Oil and Natural Gas Production and Natural Gas 
Processing Segments of the Oil and Natural Gas Sector,'' https://www.epa.gov/tribal-air/tribal-minor-new-source-review.
    \50\ Ibid.
    \51\ ``General Permits and Permits by Rule for the Federal Minor 
New Source Review Program in Indian Country,'' 79 FR 2546, January 
14, 2014, http://www.gpo.gov/fdsys/pkg/FR-2014-01-14/pdf/2013-30345.pdf.
---------------------------------------------------------------------------

2. Final Action
    In the final FIP, we have not changed the overall approach for 
requiring sources to address threatened and endangered species and 
historic properties. We are continuing to provide two options for 
sources to address threatened and endangered species and historic 
properties.\52\ However, we are modifying Sec.  49.104 of the proposed 
FIP to further specify what information will be accepted to document 
that a source has addressed threatened and endangered species and 
historic properties through actions by another federal agency. We are 
also clarifying that for sources providing documentation to the effect 
that they satisfy the criteria under Sec.  49.104(a)(1) through a prior 
assessment conducted by another federal agency, that they can submit 
the documentation with the Part 1 Registration Form.
---------------------------------------------------------------------------

    \52\ Note that the two options for addressing threatened and 
endangered species and historic properties in the final FIP have 
also been made available to other source categories for which we 
have issued general permits and permits by rule, albeit in a 
different manner. Rather than prescribe the options in regulation, 
we have made the options available as part of the procedures 
information we have provided as attachments to the Request for 
Coverage Forms and the Notification of Coverage Forms for the 
general permits and permits by rule we have issued, respectively.
---------------------------------------------------------------------------

    With respect to specific documentation requirements, the final FIP 
requires the owner/operator to submit to the EPA Regional Office (and 
to the tribe where the source is located/locating) documentation 
demonstrating that prior ESA and/or NHPA compliance has been completed 
by another federal agency in connection with the specific oil and 
natural gas activity operated under the FIP. The appropriate documents 
would have to clearly show that the other Federal agency had met its 
statutory obligations under both the ESA and NHPA. A simple reference 
to a Record of Decision (ROD) or other final decision document will not 
be acceptable. An example of acceptable documentation would be a letter 
from the Fish and Wildlife Service (FWS) for ESA or a historic 
preservation office for NHPA stating they agree with the assessment for 
the subject project and that the relevant sections of those statutes 
have been satisfied by the agency conducting the review of the proposed 
oil and natural gas activity. In addition, if a biological assessment 
and/or biological opinion have been prepared as part of the assessment 
under the ESA, then copies of those documents shall also be provided. 
The owner/operator must be in compliance with all measures required as 
part of that prior ESA and/or NHPA process.
    With respect to the process for sources using the screening 
procedures provided by the EPA for threatened and endangered species 
and historic properties, we indicated in the proposal that we would 
follow criteria similar to that used for general permits and permits by 
rule where the completed screening procedures are submitted to the EPA 
Regional office for review and written approval is obtained before 
beginning construction. Therefore, we are paralleling the procedures 
used for Permits by Rule in Sec.  49.104(a)(2) of the FIP to address 
submittal and review of completed screening procedures. Within 30 days 
of receipt of a source's documentation, the Reviewing Authority must 
provide a determination by letter to the source that: (1) The 
documentation satisfactorily demonstrates completion of the threatened 
and endangered species and historic property screening procedures; or 
(2) the documentation is not adequate and additional information is 
needed. If the initial submittal is deficient, the

[[Page 35960]]

Reviewing Authority will note any such deficiencies and may offer 
further direction on completing the screening procedures. Once the 
source has addressed the noted deficiencies, it must submit revised 
screening procedure documentation for review. An additional 15-day 
review notification period will be used for the Reviewing Authority to 
determine whether the screening procedures have been satisfied. 
Provided that they have, the Reviewing Authority will then send the 
source a letter indicating approval. The source must obtain a letter 
from the Reviewing Authority indicating that the source has adequately 
completed the processes regarding threatened and endangered species and 
historic properties before it can begin construction under the FIP. 
This process of source documentation submittal and the EPA's 
confirmation that it has satisfactorily completed the procedures must 
occur prior to the source's submittal of its Part 1 Registration Form 
pursuant to Sec.  49.160(c)(1)(iv).
3. Comments and Responses
    The following discussion contains comments on requirements relating 
to threatened or endangered species and historic properties and our 
responses. The comments and responses are also addressed in Section 2.0 
of the RTC Document.
    Comment #10: Two commenters expressed concern about the EPA's 
authority to impose requirements relating to threatened or endangered 
species and historic properties in the proposed national FIP. These 
commenters stated that where there is no federal nexus, the EPA has no 
jurisdiction to require ESA or NHPA consultations. These commenters 
also noted that the EPA is not a surface land management agency and 
does not have jurisdiction on state and private lands to require such 
consultations where a federal nexus does not exist. Another commenter 
claimed that imposition of these ESA and NHPA requirements as 
conditions of using the FIP is unlawful and unreasonable. The commenter 
stated that it is unlawful because the ESA and NHPA are triggered only 
when a federal action is taken, and that as EPA acknowledges in the 
preamble, the use of the FIP by an affected source does not require any 
federal action. Therefore, the commenter believes that there is no need 
or justification for imposing ESA or NHPA requirements when an affected 
source avails itself of the FIP.
    Response #10: We disagree with the commenters' statement that the 
EPA lacks authority to require assessments of potential impacts on 
these resources as sources are covered under the FIP. Consistent with 
the EPA's authority under the CAA, the EPA has built the screening 
procedures into the FIP as an adequate and appropriate means of 
addressing potential impacts on these resources. Given the intended 
scope of the FIP, it would be very difficult, if not impossible, for 
the EPA to evaluate such potential impacts in all areas where the FIP 
might apply. As a result, the EPA has concluded that the only way to 
address potential impacts on these resources in conjunction with the 
FIP, which is intended to provide a streamlined mechanism for complying 
with the Federal Indian Country Minor NSR rule, is to require the 
owners/operators to do it. Although the EPA is not a land management 
agency, the EPA is the federal agency promulgating the FIP, which will 
cover sources irrespective of whether they locate on federal or non-
federal land. The EPA understands that completing the screening 
procedures will impose some burden on covered sources. However, the EPA 
has attempted to streamline these procedures to the extent practicable 
while ensuring appropriate consideration of the resources. We have not 
made any changes to the ESA/NHPA procedures as a result of these 
comments.
    Comment #11: Four commenters expressed concern that the FIP's 
requirements for additional analysis addressing listed species and 
historic properties where a prior assessment by another federal agency 
has not been completed will lead to lengthy permitting delays. One 
commenter stated that the added secondary layer of listed species and 
historic property approval proposed by the EPA will add delay and 
expense, while duplicating existing protections for species and 
cultural resources. One commenter stated that the inclusion of site-
specific reviews for listed species and historic properties contradicts 
the EPA's statement in the preamble that the purpose of the FIP is to 
provide a ``streamlined'' approach to permitting minor oil and natural 
gas sources on Indian lands, which would be accomplished in part by 
imposing ``unambiguous'' requirements on affected sources. The 
commenter asserted that case-specific listed species and historic 
property review is the antithesis of an unambiguous process.
    Response #11: The EPA has promulgated the FIP to streamline the NSR 
permitting process to allow sources to avoid potential delays 
associated with individual source permitting. In connection with 
issuance of the FIP--which provides the relevant CAA authorization for 
sources to construct--the EPA has also added the threatened and 
endangered species and historic property screening procedures as an 
appropriate means of addressing potential impacts on these resources as 
sources are covered under the FIP. As indicated below, the EPA does not 
view coverage of individual sources under the FIP as separate ESA or 
NHPA triggering events. However, given the intended scope of the FIP, 
it would be very difficult, if not impossible, for the EPA to evaluate 
the potential impacts on the relevant resources in all areas where the 
FIP might apply. As a result, the EPA has concluded that the only way 
to address these impacts in conjunction with issuing this FIP, which is 
intended to provide a streamlined mechanism for complying with the 
Federal Indian Country Minor NSR rule, is to require owners/operators 
to do it. The EPA has, however, provided significant streamlining 
opportunities in this process by providing an avenue for covered 
sources to rely on prior listed species/historic property assessments 
done in connection with other federal agency permits or authorizations, 
and the EPA anticipates that many of the covered sources will have 
undergone such prior assessments and, thus, will require no further 
analysis. If analysis is required in those few cases where no prior 
assessment is available, the EPA has provided straightforward 
procedures for sources to complete their own assessments.\53\ No 
changes were made as a result of this comment.
---------------------------------------------------------------------------

    \53\ To find these procedures, go to: https://www.epa.gov/tribal-air/tribal-minor-new-source-review.
---------------------------------------------------------------------------

    Comment #12: Two commenters stated that, while federal actions 
trigger ESA consultation and NHPA review, compliance with the FIP 
itself is not a federal action triggering ESA and NHPA review. One of 
these commenters noted that the EPA acknowledged in the preamble that 
the use of the FIP by an affected source does not require any federal 
action. The other commenter stated that many of the new sources and 
modifications undertaken in reliance on this FIP will have already been 
authorized by another federal action that complies with ESA and NHPA, 
and that compliance with the FIP by these new sources and modifications 
is not the federal action. The commenter added that for projects that 
have not undergone some earlier or concurrent federal authorization 
process, compliance with the FIP is not the federal action. The 
commenter further

[[Page 35961]]

indicated that NESHAPs and NSPS present an analogous situation--sources 
complying with NESHAPs and NSPS across the country do not trigger ESA 
and NHPA reviews.
    Another commenter noted that the approach the EPA is taking with 
the FIP is unique as compared to any other directly applicable 
substantive CAA rule. For example, EPA recently proposed changes to 40 
CFR part 60, subpart OOOO, which also applies to affected sources that 
would be covered by the FIP (40 CFR part 60, subpart OOOO, is included 
in the proposed FIP). The commenter noted that there is no mention of 
ESA or NHPA in the 40 CFR part 60, subpart OOOOa, proposal. In the 
commenter's view, like the FIP, 40 CFR part 60, subpart OOOO (and the 
proposed 40 CFR part 60, subpart OOOOa), effectively authorize the 
construction of new sources and modification of existing sources. And, 
like the FIP, 40 CFR part 60, subpart OOOO, applies directly to 
affected sources without any need or requirement for case-specific 
authorization or decision-making. The commenter asserts that the 
difference in approach between the proposed FIP and other directly 
applicable CAA substantive rules is unexplained and unexplainable and 
that there is no justification for imposing ESA and NHPA requirements 
under the FIP.
    Response #12: The EPA agrees that each separate coverage under the 
FIP does not constitute an action that triggers ESA/NHPA. However, the 
EPA disagrees that the listed species and historic property screening 
procedures included in the FIP impose ESA or NHPA compliance 
requirements on covered sources. These screening procedures are 
intended to be an appropriate means of addressing potential impacts on 
the relevant resources in connection with the EPA's issuance of the 
FIP, which provides CAA authorization for sources to construct in lieu 
of individual or other permitting under the Federal Indian Country 
Minor NSR rule.
    The screening procedures are requirements of the FIP--not of the 
ESA or NHPA--and are consistent with the EPA's authority under the CAA. 
These requirements are appropriate for the FIP, which, as noted above, 
provides CAA authorization for sources to construct without the need 
for separate NSR permitting. By contrast, NSPSs and NESHAPs impose 
emission reduction requirements on sources, but are not separate 
authorizations for construction. We have not made any changes as a 
result of these comments.
    Comment #13: One commenter expressed concern about the potential 
burdens associated with the listed species and historic property 
compliance provisions and urged the EPA to clarify when an affected 
facility is permitted to rely on a prior NEPA analysis to fulfill these 
requirements. This commenter asked the EPA to clarify that the prior 
NEPA review need not be conducted simultaneously with the construction 
or modification of the affected facility, referring to cases where the 
BIA or BLM may have completed an applicable NEPA review well in advance 
of the specific construction activity. This commenter also requested 
that the EPA consider whether programmatic environmental impact 
statements (EISs) can satisfy the relevant requirements, noting that 
programmatic EISs can address both ESA and NHPA issues on a 
reservation-by-reservation basis in a manner that addresses both the 
historic resources and endangered species that may be present in a 
given area. This commenter stated that allowing individual sources to 
rely on prior ESA and NHPA analyses in a programmatic EIS can provide 
further streamlining benefits that will reduce the costs of 
implementation, while ensuring that environmental goals are met.
    Response #13: The EPA has added regulatory text to the final rule 
to clarify the documentation that needs to be submitted with the Part 1 
Registration Form, what the documentation must show, and the process by 
which it must be submitted. The documentation must demonstrate that, 
for the project site operating under the FIP, another Federal agency 
(e.g., BLM or BIA) had met its applicable statutory obligations under 
the ESA and NHPA in connection with its involvement with the project. 
An example of acceptable documentation would be a letter from the FWS 
(for ESA) or a historic preservation office (for NHPA) stating that the 
project has been reviewed, and the relevant statutes have been 
satisfied by the agency conducting the review, that any impacts of the 
project have been assessed, and any appropriate mitigation included. 
Such letters may, for instance, include a concurrence from FWS that a 
project will have no likely adverse effects on listed species or 
critical habitat.
    Comment #14: One commenter requested that the EPA provide a 
procedure for reviewing the ESA and NHPA analyses conducted by other 
agencies (e.g., BIA and BLM) to ensure that it is adequate and 
sufficient. The commenter stated that the EPA must ensure that 
emissions from a proposed project do not adversely impact threatened or 
endangered species or their habitat. The commenter added that the many 
sensitive cultural sites and areas of special cultural and spiritual 
significance to tribes and their members must receive the full 
protection they deserve under the law.
    Response #14: The EPA appreciates the commenter's concern that 
listed species and historic properties, including properties of 
specific interest to Indian tribes, receive appropriate consideration 
and protection. The EPA believes as a general matter that the agencies 
with relevant resource expertise \54\ (e.g., the U.S. Fish and Wildlife 
Service and Tribal and State Historic Preservation Officers) are best 
qualified to ensure that the considerations the commenter is raising 
related to threatened and endangered species and cultural resources are 
addressed. The EPA has thus included appropriate screening procedures 
in the FIP to ensure that a complete assessment of covered projects 
occurs, either as part of a separate federal agency's prior compliance 
with the ESA and NHPA in connection with a source, or during a source's 
screening review under the FIP if no such prior assessment is 
available. In either scenario, the expert resource agencies will be 
appropriately involved in the consideration of any impacts on the 
resources and in the development of any relevant mitigation measures. 
The EPA will then ensure that sources have successfully completed the 
assessment process, that the documentation is available, and that the 
sources are in compliance with the FIP's requirements, including 
requirements with adequate measures to address air quality issues.
---------------------------------------------------------------------------

    \54\ These experts possess the knowledge--and, under their 
statutes and regulations, the authority and responsibility--
necessary to assess impacts on protected resources and to judge the 
adequacy of any mitigation measures needed to protect those 
resources.
---------------------------------------------------------------------------

    By way of example, the EPA envisions the process could work as 
follows: an oil and natural gas owner/operator submits a request to 
drill to BLM or BIA; BLM/BIA initiate a comprehensive review of the 
project's potential impacts on the protected resources and engage in 
any required consultations with the expert resource agencies prior to 
approving new oil and natural gas activity; these consultations and 
assessments address direct and indirect effects of the action on the 
protected resources; the process concludes with relevant concurrences 
or other final decisions regarding the project's impacts and 
identification of any mitigation measures; and the source submits 
required information to the EPA

[[Page 35962]]

under the FIP to demonstrate compliance with the ESA and NHPA as part 
of the prior review. The EPA notes that this process may occur as part 
of a review by the other federal agency under NEPA, in which case the 
EPA may be involved as one of the reviewing agencies of the NEPA 
assessment. In light of the degree of involvement of the land 
management federal agencies in project oversight and the expertise of 
the resource agencies, the EPA anticipates that this process will 
result in appropriate consideration of any impacts on the protected 
resources and that additional involvement by the EPA in that review 
would not provide meaningful additional input. The EPA has revised the 
regulatory text to specify what documentation relating to another 
Federal agency's compliance with ESA and NHPA is acceptable to 
demonstrate that these requirements are met.

E. Rationale for the FIP

1. Proposed Rule
    In the section of the preamble on the rationale for the proposed 
FIP, we addressed four topics:
     Choice of a FIP as an alternative to source-specific 
permits, general permits and permits by rule;
     How we select which equipment to include in the proposed 
FIP;
     Why we are excluding existing sources from the proposed 
oil and natural gas FIP; and
     Why we proposed to extend the permitting deadline for oil 
and natural gas true minor sources in areas covered by the Federal 
Indian Country Minor NSR rule?
    We are addressing the first three topics in Sections IV. E., H. and 
J. below, respectively. The fourth topic concerning the extension has 
already been addressed in a separate final action.\55\
---------------------------------------------------------------------------

    \55\ ``Review of New Sources and Modifications in Indian 
Country: Extension of Permitting and Registration Deadlines for True 
Minor Sources Engaged in Oil and Natural Gas Production in Indian 
Country,'' U.S. Environmental Protection Agency, 81 FR 9109, 
February 24, 2016, https://www.gpo.gov/fdsys/pkg/FR-2016-02-24/pdf/2016-03623.pdf.
---------------------------------------------------------------------------

    Generally, with respect to the rationale for the FIP, we indicated 
that our proposal represented a proper exercise of our authority under 
Sec.  49.11(a) of the Tribal Authority Rule which states that the EPA 
shall promulgate without unreasonable delay such FIP provisions as are 
necessary or appropriate to protect air quality, consistent with the 
provisions of sections 301(a) and 301(d)(4), if a tribe does not submit 
a TIP meeting the completeness criteria of 40 CFR part 51, appendix V, 
or does not receive EPA approval of a submitted tribal implementation 
plan (see Sec.  49.11(a)). We indicated that the proposed FIP would 
apply to new and modified true minor sources that are located or 
expanding in the referenced areas of Indian country designated as 
attainment, unclassifiable or attainment/unclassifiable. It would not 
apply to new and modified true minor sources that are located or 
expanding in referenced areas of Indian country designated 
nonattainment. Thus, underlying the proposal was the EPA's belief that 
the FIP as proposed would be protective of air quality in areas of 
Indian country designated attainment, attainment/unclassifiable and 
unclassifiable but not areas designated nonattainment. Sources locating 
or expanding in areas designated as nonattainment would be required to 
obtain source-specific permits pursuant to the Federal Indian Country 
minor NSR rule, thereby allowing the EPA to include any requirements 
needed to provide air quality protection beyond that provided by the 
FIP. In addition, the EPA retains the authority under the FIP to 
require sources locating or expanding in areas designated attainment, 
attainment/unclassifiable and unclassifiable to obtain source-specific 
permits if it determines that this is necessary to protect air quality 
in a particular area. The FIP as proposed included a comprehensive set 
of standards, including the requirements under 40 CFR part 60, subpart 
OOOOa, which has undergone revision and reflects the latest in oil and 
natural gas control measures.
2. Final Action
    The EPA continues to believe that this final FIP that relies on 
eight federal standards for its requirements will be protective of air 
quality in attainment, attainment/unclassifiable and unclassifiable 
areas, provided the EPA retains the ability to require source-specific 
permits and/or area-specific FIPs where needed to protect air quality 
in specific areas. Below are several comments on this issue and our 
responses.
3. Comments and Responses
    The following discussion contains comments on issues related to the 
rationale for the proposed FIP and our responses. The comments and 
responses are also addressed in Section 3.0 of the RTC Document.
    Comment #15: One commenter stated that the EPA has provided no 
assurance that the regulations included in the FIP will adequately 
address air quality problems in Indian country and ensure compliance 
with all applicable standards, including the NAAQS, PSD Program, and 
the visibility protection program. The commenter noted that, although 
the EPA proposes a FIP to streamline the permitting process, the 
proposed FIP does not achieve the goals of the case-by-case permitting 
the EPA established in the Federal Indian Country Minor NSR rule--
namely adequate protection of public health and the environment. The 
proposed FIP would allow minor oil and natural gas sources to forego 
pre-construction review and permitting altogether and instead simply 
self-certify that they will comply with the six regulations that 
already apply within Indian country. The EPA has provided no analysis 
of whether these six regulations will adequately address the air 
quality problems in Indian country or ensure compliance with the NAAQS, 
PSD Program, and the visibility protection program.
    Response #15: The EPA believes that the eight regulations included 
in the final rule represent a robust set of control measures that are 
adequate to protect air quality in Indian country in attainment, 
attainment/unclassifiable and unclassifiable areas. The EPA can require 
source-specific permits where needed to further protect air quality in 
these areas.
    In addition, the Federal Indian Country Minor NSR rule does not 
require an air quality analysis in all instances for minor source 
permits even in the context of a source-specific permit. While Sec.  
49.154(c)(1)(i) indicates that we will consider ``[l]ocal air quality'' 
in determining whether to issue a source-specific permit, it does not 
require an air quality analysis and in fact Sec.  49.154(d) establishes 
specific circumstances in which the Reviewing Authority can require the 
owner/operator to conduct an air quality impacts analysis (AQIA). Air 
quality factors are just one consideration with a source-specific 
permit. We have not made any changes as a result of this comment.
    Comment #16: One commenter stated that the EPA did not conduct any 
control technology review, air quality impacts analysis, or dispersion 
modeling for the proposed FIP.
    Response #16: The EPA's analysis and review consisted of 
establishing a set of requirements that we believe are sufficient to 
protect the NAAQS and PSD increments in attainment, attainment/
unclassifiable and unclassifiable areas with the caveat that the EPA 
can require source-specific permits where needed to further protect

[[Page 35963]]

air quality in a given area. Moreover, all eight regulations included 
in this FIP are based on the EPA's analyses of available technologies. 
The FIP requires compliance with the most current version of these 
regulations. So, the control requirements in this FIP will stay up to 
date, as these rules are based on the most current technologies. 
Finally, as noted above, the Federal Indian Country Minor NSR rule does 
not require an air quality analysis in all instances when a permit is 
issued even with a source-specific permit. No changes were made as a 
result of this comment.
    Comment #17: One commenter expressed concern about the lack of any 
requirements in the proposed FIP for air quality monitoring and 
modeling, and recommended that the proposed FIP include requirements to 
improve air quality monitoring and modeling within Indian country. This 
commenter noted that the air quality in many areas of Indian country 
with oil and natural gas development exceeds federal public health 
standards for ozone and particulates. The commenter expressed concern 
that, without adequate monitoring, the EPA cannot ensure that it is 
protecting public health from the emissions associated with oil and 
natural gas development. This commenter stated that the most efficient 
and expedient method of providing such a monitoring network is 
requiring operators to install and operate monitors. The commenter 
noted that the EPA has authority under CAA section 114 to require 
operators to install and operate ambient air quality monitors.
    Response #17: With respect to monitoring, the EPA works closely 
with tribes, as well as state and local partners, to implement and 
maintain a national ambient air monitoring program. In many cases, 
ambient networks include more monitors than are required by minimum 
requirements in the EPA's monitoring regulations. The EPA Regional 
Administrators have the authority to require additional monitoring in a 
variety of situations; such authority is specifically noted throughout 
the language in Appendix D to 40 CFR part 58, Network Design Criteria 
for Ambient Air Quality Monitoring. Accordingly, the EPA believes that 
the current authority to require monitoring above minimum requirements 
is sufficient to support this final rule and the need to employ 
additional air quality monitoring in areas of Indian country where the 
air quality may not be fully characterized. As the commenter points 
out, the EPA has the authority under section 114 of the CAA to require 
air quality monitoring if it determines that this is necessary in a 
particular areas. For these reasons, we do not believe that including 
monitoring requirements in this rule is necessary. Additionally, the 
EPA is exploring alternative sensor technology that can be used to 
compliment traditional compliance-based monitoring based on Federal 
Reference Method or Federal Equivalent Method monitoring equipment. The 
EPA anticipates that alternative sensor technology may be used in the 
future as a screening tool to determine if longer term monitoring with 
more specialized equipment is needed.
    Regarding modeling, as noted above, the Federal Indian Country 
Minor NSR rule does not require an air quality analysis (and the 
modeling that would accompany it) in all instances when a permit is 
issued even with a source-specific permit. With respect to the final 
FIP, we do not believe that modeling is necessary; rather, we believe 
that the suite of eight federal regulations that constitute the FIP's 
set of control requirements are sufficent to protect air quality in 
areas of Indian country designated attainment, attainment/
unclassifiable and unclassifiable. We have not made any changes in 
response to this comment.
    With respect to air quality in areas of Indian country with oil and 
natural gas development, currently we are not seeing widespread air 
quality problems. Based on air quality data for 2012-2014,\56\ (outside 
of Oklahoma) there are only two counties that meet three criteria: Have 
Indian country present; have design values (DVs) above the level of the 
current ozone NAAQS (70 parts per billion [ppb]); and have oil and 
natural gas activity. The two counties that meet these three criteria 
are in Utah and are: Duchesne and Uintah Counties.\57\ The majority of 
the land area in both of these counties is on the Uintah and Ouray 
Reservation. For the Uintah and Ouray Reservation, we have sufficient 
concerns about the air quality impacts from existing sources that we 
plan to propose a separate reservation-specific FIP.
---------------------------------------------------------------------------

    \56\ The EPA will not designate areas as nonattainment based on 
these data, but likely based on 2014-2016 data.
    \57\ Supporting information can be found in: Docket ID No. EPA-
HQ-OAR-2014-0606.
---------------------------------------------------------------------------

    For areas designated nonattainment for NAAQS (2008 ozone NAAQS, 
2006 and 2012 PM2.5 NAAQS), based on air quality DVs for 
2012-2014, there are not any areas that meet three criteria: Have 
Indian country present; have DVs above the level of the NAAQS; and have 
oil and natural gas activity.\58\
---------------------------------------------------------------------------

    \58\ Ibid.
---------------------------------------------------------------------------

    Comment #18: One commenter expressed concern about the lack of 
enforcement requirements in the FIP. The commenter noted that the 
proposed FIP provides few, if any, enforcement tools, and requested 
that the EPA clarify, add, and expand enforcement requirements in the 
final rule. The commenter encouraged the EPA to implement Next 
Generation Compliance techniques (such as self-certification and 
photographic verification, per 40 CFR part 60, subpart OOOO) in the 
final rule, and recommended that the EPA should also robustly pursue 
standard enforcement procedures in Indian country.
    Response #18: Since the EPA is relying on the monitoring, 
recordkeeping and reporting requirements in the eight rules underlying 
this final FIP to be comprehensive in ensuring compliance, we do not 
feel that additional, separate compliance measures are needed. The 
requirements in the eight rules are independently enforceable under 
those rules as well as being enforceable under the FIP. An owner/
operator is responsible for correctly permitting its sources. If it is 
later determined that the source is not complying with the emission 
limitations and standards prescibed in the eight rules as required by 
the FIP, the EPA can take enforcement action to bring a source into 
compliance. The EPA can also enforce major source requirements in 
situations where it is determined that a source emitted or has the 
potential to emit pollutants in major source amounts. We have not made 
any changes as a result of this comment.

F. The FIP as an Alternative to Source-Specific Permits, General 
Permits and Permits by Rule

1. Proposed Rule
    With respect to source-specific permits, we proposed that owners/
operators of new and modified true minor oil and natural gas sources 
that meet all of the following criteria must comply with the 
requirements contained in Sec. Sec.  49.101 through 49.105 of the 
proposed FIP, unless the owner/operator opts-out of the FIP and instead 
obtains a source-specific permit per proposed Sec.  49.101(b)(2) and 
(3):
     The facility is an oil and natural gas production facility 
as defined in proposed Sec.  49.102;
     The oil and natural gas production facility is located in 
areas covered by the Federal Indian Country Minor NSR rule as defined 
in Sec.  49.152(d) as proposed to be amended in the action;

[[Page 35964]]

     The oil and natural gas production facility is a new true 
minor source or a minor modification of an existing true minor source 
as determined under Sec.  49.153;
     The oil and natural gas production facility begins 
construction or modification on or after October 3, 2016, the proposed 
extended permitting deadline date; and
     The oil and natural gas production facility is not located 
in a designated nonattainment area (the proposed FIP would only apply 
to true minor sources in the oil and natural gas sector locating or 
expanding in areas designated as attainment, attainment/unclassifiable 
or unclassifiable).

Under the proposed FIP, sources covered by the Federal Indian Country 
Minor NSR rule that do not meet all of the criteria listed above are 
not eligible to use the FIP and must, therefore, obtain a source-
specific permit prior to beginning construction, on or after October 3, 
2016.
    If a source owner/operator does not want to comply with the FIP, 
they have the option to apply for a source-specific permit instead to 
meet the obligation under Sec.  49.151(c)(1)(iii)(B) of the Federal 
Indian Country Minor NSR rule to obtain a permit prior to commencing 
construction of a new true minor source or modification of an existing 
true minor source. As part of the FIP, we proposed specific rule 
language in Sec.  49.101(b)(2) to allow true minor sources proposing to 
construct on or after the proposed, extended deadline date of October 
3, 2016, to opt-out of the default FIP if preferred by the owner/
operator. We proposed that an owner/operator of a source otherwise 
subject to the proposed FIP can opt out and seek a source-specific 
permit under Sec.  49.151(c)(1)(iii).
    We also proposed that the EPA, or other Reviewing Authority, may 
require owners/operators to obtain a source-specific permit in lieu of 
complying with the proposed FIP to ensure protection of the NAAQS. 
Under Sec.  49.101(b)(3), we proposed to specify that the Reviewing 
Authority may require an owner/operator of a source proposing to 
construct in certain areas of Indian country on or after October 3, 
2016, to apply for a source-specific permit for a new true minor source 
or minor modification of an existing true minor source where necessary 
to protect air quality. In particular, the Reviewing Authority may 
determine that the source is not sufficiently controlled under the 
proposed FIP to protect the NAAQS in the area of the proposed project 
(e.g., if the measured DV for the area is close to or above the level 
of the NAAQS). In that circumstance, the Reviewing Authority can 
require the minor source to obtain a source-specific permit. The agency 
recommends that at the time of registration, the owner/operator of new 
and modified sources contact the Reviewing Authority about the air 
quality status of the area, and the need to obtain a source-specific 
permit.
    Concerning the selection of a FIP as an alternative to source-
specific permits, general permits and permits by rule, in the ANPR, we 
committed to developing an alternative to source-specific permits 
primarily to avoid delays in new construction due to the burden of 
processing hundreds of true minor source permits in a timely manner. A 
FIP provides a regulatory tool that protects air quality, streamlines 
implementation and compliance assurance, and meets the EPA's obligation 
to permit minor NSR sources. The alternatives--source-specific permits, 
general permits and permits by rule--do not satisfy all of these 
concerns, which we explain in the preamble of the September 18, 2015 
action proposing the FIP.
    Unlike NSR general permits and permits by rule, which cannot be 
used to address existing sources, a FIP could extend to existing 
sources; this is a key distinction between general permits and permits 
by rule versus a FIP. However, the proposal did not contain 
requirements for existing sources. We indicated that our plan is to 
address existing sources, to the extent necessary, in the context of 
area- or reservation-specific FIPs designed to address areas or 
reservations with air quality issues (including nonattainment or 
possible nonattainment areas), as they arise, that are associated with 
oil and natural gas activities. Such FIP(s) would need to address, as 
necessary, requirements for existing sources, as well as additional 
requirements beyond those in this proposal for new and modified 
sources.
2. Final Action
    After carefully considering the comments received, we have decided 
to retain the FIP as the streamlined mechanism for permitting true 
minor sources in the oil and natural gas production and natural gas 
processing segments of the oil and natural gas sector in Indian 
country. We believe that our initial reasoning laid out in our proposal 
is still sound in light of comments received. We also believe that we 
need to retain the provision in the FIP as proposed with respect to 
source-specific permits. In the final FIP under Sec.  49.101(b)(2), 
owners/operators of facilities that meet the criteria specified for 
eligibility in the FIP can choose to obtain a source-specific permit in 
lieu of complying with the FIP as specified in 40 CFR 49.155 before 
beginning construction; any such source would not be required to comply 
with the requirements of Sec. Sec.  49.101 to 49.105. In addition, 
under Sec.  49.101(b)(3) of the final FIP, with advance notice owners/
operators of facilities that meet the criteria specified for 
eligibility in the FIP can be required by the Reviewing Authority to 
obtain a source-specific permit to ensure protection of the NAAQS as 
specified in 40 CFR 49.155 before beginning construction; any such 
source would not be required to comply with Sec. Sec.  49.101 to 
49.105.
3. Comments and Responses
    The following discussion contains comments on issues related to the 
choice of FIP as an alternative to source-specific permits, general 
permits and permits by rule and our responses. The comments and 
responses are also addressed in Section 4.0 of the RTC Document.
    Comment #19: One commenter proposed that a general permit or permit 
by rule would be the best permitting approach for Indian country and 
could allow for legally and practically enforceable limits. They 
further suggested that ambient air quality impact modeling could be 
used to develop the general permit or permit by rule to ensure 
protection of the NAAQS.
    Response #19: In the ANPR, the EPA committed to developing an 
alternative to source-specific permits primarily to avoid delays in new 
construction due to our inability to process potentially thousands of 
true minor oil and natural gas source permits in an acceptable 
timeframe. Comments received on the ANPR and on the proposed FIP were 
generally supportive of a FIP approach, which we are finalizing. As 
indicated above, we continue to believe that the FIP approach can best 
protect air quality in attainment, attainment/unclassifiable and 
unclassifiable areas, while providing streamlined permitting. We do not 
believe that modeling is necessary to ensure air quality protection in 
attainment, attainment/unclassifiable and unclassifiable areas given 
the comprehensive nature of the requirements in the eight standards 
underlying this FIP.
    Comment #20: Several commenters expressed concern that a FIP would 
not provide an opportunity for comment about a specific facility's 
coverage under a FIP. In particular, commenters noted that there may be 
concerns specific to particular sites that are not addressed within the 
existing FIP. One commenter

[[Page 35965]]

noted that under a FIP, tribes and the public are only provided a one-
time opportunity to provide feedback on the proposed rule and would not 
be provided the opportunity to comment on individual sources proposed 
in their tribal area.
    Response #20: The EPA agrees with the importance of providing 
opportunity for comment on the FIP. The EPA held three public hearings 
across the country \59\ to solicit comments on the proposed FIP and 
also extended the public comment period on the proposed FIP by 21 days 
from November 14, 2015 until December 4, 2015. If the EPA requires a 
source-specific permit or develops an area-specific FIP, there will be 
additional opportunity for public comment on those specific permitting 
actions at that time.
---------------------------------------------------------------------------

    \59\ The dates and locations of the hearings were as follows: 
Denver, Colorado, September 23, 2015; Dallas, Texas, September 23, 
2015; and Pittsburgh, Pennsylvania, September 29, 2015. ``Source 
Determination for Certain Emission Units in the Oil and Natural Gas 
Sector; Oil and Natural Gas Sector: Emission Standards for New and 
Modified Sources; and Review of New Sources and Modifications in 
Indian Country: Federal Implementation Plan for Managing Air 
Emissions From True Minor Sources Engaged in Oil and Natural Gas 
Production in Indian Country,'' U.S. Environmental Protection 
Agency, 80 FR 51991, August 27, 2015, https://www.gpo.gov/fdsys/pkg/FR-2015-08-27/pdf/2015-21255.pdf.
---------------------------------------------------------------------------

    In addition, new and modified sources under the FIP will have to 
register and provide source information and emissions. Each completed 
registration will be added to the EPA Regional Office Web sites.\60\ If 
a citizen has information that a particular source may not be complying 
with the FIP, or that compliance with the FIP may not be sufficient due 
to air quality concerns in a particular area, the information could be 
brought to the EPA's attention.
---------------------------------------------------------------------------

    \60\ For example, for EPA Region 8, the following Web site will 
be used to provide the completed registration forms: https://www.epa.gov/caa-permitting/tribal-nsr-permitting-region-8.
---------------------------------------------------------------------------

    Comment #21: One commenter requested a commitment from the EPA to 
provide funding to tribes for the development of TIPs to regulate minor 
oil and natural gas sources specific to areas under their jurisdiction, 
including the potential future regulation of existing minor sources. 
One commenter expressed an interest in developing a TIP. The commenter 
noted that the EPA promulgated the ``Tribal Authority Rule'' in 1998 to 
provide more detailed criteria and procedures for tribes to be treated 
as states under the CAA if they seek CAA program approval, and that 
tribes are authorized to develop a comprehensive TIP and to seek full 
authority to monitor and enforce the NAAQS within their reservation. 
The commenter expressed interest in exploring the possibility of 
working toward a TIP so that it may one day assume primacy over certain 
regulatory functions and gradually expand its authority.
    Response #21: The EPA supports tribes developing their own air 
programs and, as desired, TIPs. The EPA has historically provided 
funding and other technical support towards this goal, and we will 
continue to seek tribal air funding and support. In particular, we 
anticipate proactively supporting development of TIPs, especially in 
areas with air quality DVs above the NAAQS.
    Comment #22: Several commenters expressed concern about provisions 
in the proposed FIP allowing the EPA the discretion to require source-
specific permitting to ``ensure attainment of the NAAQS'' on a case-by-
case basis. This might particularly affect areas in Indian country 
where design values are close to the current ozone NAAQS of 70 ppb. In 
addition, commenters expressed concern that given the 30-day notice 
provided for under the FIP, the notification that a facility has been 
denied coverage under the FIP and will be required to obtain a source-
specific permit might be received only at the last minute, causing 
financial burden on operators that have already initiated procurement 
of construction materials and labor. The commenters explained that the 
EPA should provide the criteria by which they will require source-
specific permits, and should consider including modeling demonstrations 
as part of source-specific permitting. One commenter objected to the 
broad and unrestricted manner under which the FIP allows the EPA to 
require a source to obtain a source-specific permit, and requested that 
the EPA provide more definitive language on what critieria it would use 
to disallow a source to construct under the FIP and to require a 
source-specific permit.
    Response #22: The EPA continues to believe that this FIP will be 
protective of air quality in attainment, attainment/unclassifiable and 
unclassifiable areas of Indian country, provided we retain the ability 
to require source-specific permitting as needed to protect air quality. 
The EPA intends to make those determinations on a case-by-case basis. 
Factors we will consider include: Levels of measured air quality 
relative to the NAAQS and rates of growth in oil and natural gas 
production activity and associated changes in emissions. Any decision 
to require source-specific permitting will apply to the entire area in 
question and to all sources planning to locate or expand in such area 
and we will provide advance notice to owners/operators and tribes in 
the affected area prior to a programmatic, area-wide imposition of 
source-specific permitting.
    Comment #23: Several commenters encouraged the EPA to develop 
reservation-specific or region-specific FIPs that account for 
particular air quality concerns and that are consistent with the 
permitting rules and requirements of the surrounding states. This will 
help level the playing field between neighboring permitting 
jurisdictions and ensure that oil and natural gas development on tribal 
lands is not disadvantaged solely due to permitting differences. One 
commenter specifically referred to the Uintah and Ouray Indian 
Reservation, which is a tribal area at risk of nonattainment 
designation under the lowered ozone standard. The commenter noted that 
revenue generated from oil and natural gas development in this area is 
an important part of the tribal and regional economy. One commenter 
suggested that the EPA not wait until certain areas are re-designated 
as nonattainment to develop area-specific FIPs, but that the EPA should 
develop area-specific FIPs for areas in danger of re-designation 
immediately, notably the Uinta Basin and the San Juan Basin.
    One commenter stated that the EPA should define ``necessary or 
appropriate'' by identifying more specific criteria for when 
reservation-specific FIPs will be issued. The commenter suggested that 
one such criterion would be ozone concentrations close to the NAAQS. 
The commenter further recommended that the EPA should base its decision 
on the availability of two years of valid monitoring data, considering 
data from all available, reliable monitors, regardless of whether the 
EPA has certified them as regulatory monitors.
    Response #23: The EPA continues to believe that this FIP will be 
protective of air quality in attainment, attainment/unclassifiable and 
unclassifiable areas of Indian country. We, nevertheless, have the 
authority to promulgate reservation-specfic FIPs if we determine that 
it is necessary or appropriate to protect air quality. The EPA intends 
to make those determinations on a case-by-case basis. Factors we will 
consider include: Levels of air quality the area in question is 
experiencing relative to the NAAQS, rates of growth in oil and natural 
gas production activity, and associated changes in emissions in the 
area in question. We will work with tribes in developing any area-
specific FIP that we determine is necessary or appropriate to protect 
air quality and will provide notice and an opportunity

[[Page 35966]]

for comment prior to the promulgation of an area-specific FIP.
    Comment #24: One commenter noted that tribal areas across the 
country currently include thousands of wells, and that there are 
thousands more forthcoming. Accordingly, all of this activity gives 
rise to ever-increasing emissions, exposes tribal members to harmful 
air toxics and impacts visibility in Class I areas such as national 
parks and wilderness areas. In addition, oil and natural gas sector 
emissions include large quantities of methane, which contributes to 
climate change. The commenter encourages the EPA to develop national 
uniform requirements to protect public health and welfare and to 
mitigate the severity of climate change.
    Response #24: The EPA agrees with the commenters that oil and 
natural gas development in tribal areas results in emissions of harmful 
air toxics and other pollutants of concern. To mitigate these impacts, 
the proposed FIP included a uniform set of requirements from six 
current federal rules that apply in all tribal areas. In addition to 
these six, the EPA is adding two additional rules to the final FIP: 40 
CFR part 60, subpart KKKK, and 40 CFR part 63, subpart ZZZZ. This suite 
of eight federal rules ensures: (1) Comprehensive application of the 
latest control technologies and unit processes found in the oil and 
natural gas sector; and (2) that the sector is controlled under the 
FIP. In addition, as needed to protect air quality, the EPA will 
continue to develop area-specific FIPs and/or utilize source-specific 
permitting for areas with poor or degraded air quality. The Federal 
Indian Country Minor NSR rule is not intended to address climate change 
per se; however, compliance with a number of the included rules will 
lead to co-reductions in emissions of methane, which is a potent 
greenhouse gas (GHG).
    Comment #25: One commenter requested to have certain activities not 
considered modifications, including in-kind replacement of internal 
combustion and temporary engines, as well as control device additions, 
removals, and replacements as allowed by federal rules. This would 
allow operators to move equipment off site to perform needed repairs or 
maintenance to avoid production delays and to mitigate potential 
hazards associated with on-site maintenance.
    Response #25: On May 30, 2014, the EPA finalized revisions to the 
Federal Indian Country Minor NSR rule that exempted certain internal 
combustion engines from the permitting requirements under the rule.\61\ 
These included certain emergency generators and stationary engines with 
a horsepower rating less than 50. The final rule also provided guidance 
to industry specifically in response to a comment regarding the 
relocation or replacement of single pieces of equipment (e.g., an 
internal combustion engine) in the oil and natural gas sector. The 
source owner/operator should verify with its Reviewing Authority that 
the ``matching'' situation described in the preamble to the final May 
30, 2014 rule, and its stated outcome, applies to its case. Concerning 
control device additions, removals, and replacements, a broad exclusion 
for consideration as a modification cannot be given. Changes regarding 
control devices have the potential to increase emissions, and, thus, 
the potential emissions impact would have to be assessed by the owner/
operator. To the extent that these changes result in emissions 
increases that fall below the minor NSR thresholds or satisfy the 
criteria under the definition of modification in Sec.  49.152, there 
would be no requirement to register the unit(s) or to make a change to 
a prior registration. Under Sec.  49.152, the following exemptions to 
modifications apply:
---------------------------------------------------------------------------

    \61\ ``Review of New Sources and Modifications in Indian 
Country--Amendments to the Federal Indian Country Minor New Source 
Review Rule,'' U.S. Environmental Protection Agency, 79 FR 31035, 
May 30, 2014, https://www.gpo.gov/fdsys/pkg/FR-2014-05-30/pdf/2014-11499.pdf.
---------------------------------------------------------------------------

     A physical or operational change does not include routine 
maintenance, repair or replacement.
     An increase in the hours of operation or in the production 
rate is not considered an operational change unless such change is 
prohibited under any permit condition that is enforceable as a 
practical matter.
     A change in ownership at a stationary source.
     The emissions units and activities listed in Sec.  
49.153(c).

G. Synthetic Minor Sources and Minor Modifications at Major Sources

1. Proposed Rule
    With respect to synthetic minor sources, in the September 2015 
proposed FIP, the EPA did not structure the requirements to accommodate 
the creation of synthetic minor sources.\62\ In the Background portion 
of the notice, we noted that in May 2015 we took final action \63\ on a 
set of general permits and permits by rule in which we also authorized 
the use of general permits established under the program to create 
synthetic minor sources. We did this by including requirements in the 
general permits that otherwise major sources could comply with to 
reduce their PTE to below major source levels. We indicated in that 
action that general permits (and not permits by rule) can serve as an 
appropriate mechanism for creating synthetic minor sources because 
permits by rule do not provide for the same level of review and 
scrutiny by the Reviewing Authority as general permits. They also do 
not provide the same level of public participation. More specifically, 
in the May 2015 final action, based on comments received, we decided to 
issue final general permits for two categories (and not the three 
others) that involve more complex operations and multiple pollutants 
because the general permit approval process provides an opportunity for 
case-specific Reviewing Authority review. Because permits by rule do 
not involve the same level of review, the EPA did not finalize the use 
of permits by rule to create synthetic minor sources.
---------------------------------------------------------------------------

    \62\ Per Sec.  49.152(d), synthetic minor source means a source 
that otherwise has the potential to emit regulated NSR pollutants in 
amounts that are at or above those for major sources in Sec.  
49.167, Sec.  52.21 or Sec.  71.2, as applicable, but that has taken 
a restriction so that its potential to emit is less than such 
amounts for major sources. Such restrictions must be enforceable as 
a practical matter.
    \63\ ``General Permits and Permits by Rule for the Federal Minor 
New Source Review Program in Indian Country for Five Source 
Categories,'' U.S. Environmental Protection Agency, 80 FR 25068, May 
1, 2015, http://www.gpo.gov/fdsys/pkg/FR-2015-05-01/pdf/FR-2015-05-01-FrontMatter.pdf.
---------------------------------------------------------------------------

    With respect to minor modifications at major sources, we did not 
address the issue per se in the proposed FIP, but we did address how to 
treat such cases in the permitting documents associated with the final 
May 2015 rule.\64\ In the Request for Coverage and Notification of 
Coverage Forms \65\ from the May 2015 rule, the EPA established 
requirements that sources include all existing, new and modified units 
in their PTE determinations for purposes of comparing that PTE to the 
major source thresholds. This exercise is necessary for determining 
eligibility for the general permits. If the sum of the potential 
emissions from all of these units exceeds the major source threshold, 
then the source is not eligible for the general permit. Effectively, 
this precludes minor modifications at major sources from general permit 
eligibility.\66\ Such sources require

[[Page 35967]]

source-specific permits that undergo Reviewing Authority review. We did 
provide an exception in the May 2015 action for otherwise major sources 
that are willing to accept certain emissions limits, throughput, fuel 
and other limits and become synthetic minor sources, provided that the 
limits accepted by the source would lower source-wide PTE to below the 
major source NSR thresholds, counting emissions from all new, modified 
and existing units.
---------------------------------------------------------------------------

    \64\ Ibid.
    \65\ These forms can be found at: https://www.epa.gov/tribal-air/tribal-minor-new-source-review.
    \66\ Minor modifications at major sources are also, of course, 
not covered by the permits by rule we have issued thus far for 
reasons similar to the reasons for general permits.
---------------------------------------------------------------------------

2. Final Action
    After careful consideration of the comments, we continue to believe 
that the FIP is not an appropriate mechanism for establishing synthetic 
minor sources. We have, therefore, not made any changes to the FIP to 
accommodate its use to create synthetic minor sources. As indicated 
above, the EPA has an established policy that requires the Reviewing 
Authority have the opportunity to review any requests from a source for 
synthetic minor status; the FIP does not provide that opportunity.
    In this final action, we are also not modifying the FIP to 
authorize modifications at major sources. The FIP is being made 
available to true minor sources in lieu of a true minor source permit. 
As mentioned above, the general permits (and, as noted, permits by 
rule) the EPA has issued to date are for true minor sources and are not 
available for minor modifications at major sources. Since the FIP is in 
lieu of a minor source permit, similar to non-oil and natural gas 
sources, minor modifications at major sources must have source-specific 
permits that have undergone Reviewing Authority review. As noted above, 
we do allow general permits to create synthetic minor sources, which 
could involve a minor modification at a major source. Since we are not 
allowing for the creation of synthetic minor sources under the FIP for 
the reasons explained above, we are not allowing for the FIP to cover 
minor modifications at major sources.
    By definition, major sources are more complex than minor sources 
and, as noted above, we believe such complexity necessitates that a 
review--under a general permit or source-specific permit--needs to be 
conducted for all permitting-type changes, whether to obtain synthetic 
minor status or for a modification at an existing major source. Since 
this FIP does not provide for any EPA source-specific permit review, 
and is intended as a streamlining alternative to source-specific 
permitting, we do not believe it is appropriate to cover modifications 
at major sources in this FIP.
    We have added regulatory text to Sec.  49.101 to make it clear that 
the FIP does not apply to minor modifications at major sources.
3. Comments and Responses
    The following discussion contains comments on the use of the FIP 
for establishing synthetic minor sources and minor modifications at 
major sources as an alternative to source-specific permits, general 
permits and permits by rule and our responses. The comments and 
responses are also addressed in Section 4.0 of the RTC Document.
    Comment #26: Several commenters requested that the EPA provide a 
mechanism for obtaining synthetic minor permits under the FIP. One 
commenter noted that there are a number of emission units common at oil 
and natural gas facilities that are not subject to the six federal 
regulations included in the proposed FIP, and that, therefore, would 
not be eligible for federally enforceable limits that are available for 
units covered under the six other rules. The commenter stated that 
unless such provisions were included, an overwhelming number of 
operators in Indian country will have to obtain source-specific 
permits. One commenter noted that most states with significant oil and 
natural gas production have streamlined permitting mechanisms (e.g., 
general permits or permits by rule) in place for synthetic minor 
sources, as does the Fort Berthold Indian Reservation FIP. Another 
commenter noted that this would disadvantage oil and natural gas 
development on tribal lands because companies may prefer to locate 
where streamlined synthetic minor permitting options are available. It 
was also suggested that other limits, such as those imposed by tribal 
authorities or the BLM, be considered ``enforceable as a practical 
matter'' when considering the PTE and permit level. One commenter 
suggested insertion of the following language to allow for federally 
enforceable limits for emission units not subject to the six other 
rules:

    (a) Sources not subject to NSPS or NESHAPs may elect to comply 
with a NSPS or NESHAP under this FIP as a mechanism to establish 
enforceable conditions on the source's potential to emit. Once the 
source elects to be subject to the NSPS or NESHAP, the NSPS or 
NESHAP are enforceable against the source under this FIP.
    (b)(i) Sources may elect to be subject to one or more facility-
wide emission limits listed below.
    a. 249 tons per year of any NSR regulated pollutant in an 
attainment area;
    b. 99 tons per year of any NSR regulated pollutant in any 
nonattainment area;
    c. 24 tons per year of total hazardous air pollutants;
    d. 9 tons per year of any single hazardous air pollutant;
    e. 99 tons per year of any regulated pollutant;
    (ii) The facility-wide emission limits are 12-month rolling 
limits. Once a source elects coverage under this paragraph, the 
source must demonstrate compliance every month based on emissions of 
the prior 12 months.
    (iii) Sources subject to this paragraph shall demonstrate 
compliance and determine emissions based on the monitoring and 
recordkeeping dictated in any NSPS or NESHAP for the types of 
equipment covered under the facility-wide emissions limit.
    (iv) Sources subject to this paragraph shall monitor emissions 
and emissions-related data and keep records consistent with NSPS or 
NESHAP monitoring and recordkeeping for the types of equipment 
covered by the emissions limit for the purposes of compliance with 
this paragraph, even if such equipment is not subject to the NSPS or 
NESHAP.

The commenter suggested that the EPA allow for flexibility in synthetic 
minor limits in terms of production, throughput, or hours of operation. 
One commenter suggested that the EPA provide a general permit, or 
separate general permits for different unit types, pursuant to Sec.  
49.156 with a suite of standards that would allow for federally 
enforceable limits on units not subject to the six other rules included 
in the proposed FIP. Several commenters suggested that self-
certification could be included in provisions allowing for synthetic 
minor limits, and that this would reduce the burden on the EPA to have 
to issue synthetic minor limits under a source-specific permit.
    Response #26: The current Federal Indian Country Minor NSR rule 
only allows the permitting of synthetic minor sources on a source-
specific basis. The EPA's review is necessary to establish synthetic 
minor limits because without the verification that the required 
controls and associated compliance provisions will accomplish their 
objective, the source is a major source. Due to the streamlined nature 
of the oil and natural gas FIP, such review is not part of the FIP's 
process, which only requires source registration. Synthetic minor 
sources are more appropriately permitted under source-specific permits 
as they provide an opportunity for case-specific, Reviewing Authority 
evaluation.
    Moreover, the EPA's Reviewing Authorities in our Regional Offices 
have seen no evidence of a high volume of requests for synthetic minor 
permits from oil and natural gas sources. Nor did commenters provide 
information on the volume of synthetic minor status requests to support 
the need for a

[[Page 35968]]

synthetic minor option. Sources subject to the FIP are free to seek a 
source-specific sythetic minor permit pursuant to Sec.  49.158.
    No changes will be made as a result of this comment.
    Comment #27: Several commenters requested that the EPA provide a 
mechanism under the FIP to allow for construction of minor 
modifications at major sources, as well as modifications at synthetic 
minor sources. One commenter noted that modifications occurring at 
major sources may be of the same type and size as a modification at a 
true minor source, yet these situations would be treated differently 
under the proposed FIP as they would require time-consuming source-
specific permits. One commenter noted that the EPA should not use the 
term ``minor modifications at true minor sources'' in the rule because 
all modifications at a true minor source are covered under minor NSR. 
One commenter requested that the EPA replace references to ``minor 
modifications at existing true minor oil and natural gas sources'' with 
``minor modifications at existing oil and natural gas sources.'' In 
addition, the commenter requested that the FIP allow for minor 
modifications at major sources as such modifications are allowed under 
the Federal Indian Country Minor NSR rule (Sec.  49.151). The proposed 
verbiage revisions would reflect that such modification at major 
sources were covered under the FIP.
    Response #27: The July 2011 Federal Indian Country Minor NSR rule 
provided for the streamlining of the permitting of true minor sources 
through the use of general permits (and eventually permits by rule), 
with the permitting of minor modifications at major sources requiring 
source-specific permitting. As indicated above in the discussion of the 
general permits and permits by rule that the EPA has already issued 
under the Federal Indian Country Minor NSR rule, this FIP is not a 
permitting option available for minor modifications at major sources. 
Major sources are more complicated than minor sources, and 
modifications at major sources are likely to be as well. Such sources 
require the in-depth review of source-specific permits. By streamlining 
less significant actions (i.e., true minor sources), we are freeing up 
resources for the EPA to address actions at the larger, more complex 
sources. As this FIP is limited to true minor sources (see response to 
comments above), the suggested change is not necessary and no change 
will be made as a result of this comment.
    Comment #28: One commenter requested that the EPA amend the Federal 
Indian Country Minor NSR rule to expand the definition of 
enforceability to allow limits to be considered ``enforceable as a 
practical matter'' to mean that a limit or standard is legally and 
praticably enforceable if a government authority, federal or tribal, 
has the right to enforce it. In particular, the commenter suggested 
that such limits could be imposed by the BLM or a tribal authority.
    Response #28: The definition of ``enforceable as a practical 
matter'' in Sec.  49.152 states that an emission limitation or other 
standard is legally enforceable if the reviewing authority has the 
right to enforce it. Under this FIP, the EPA is the Reviewing 
Authority. Therefore, limits or other standards that are not 
enforceable by the EPA cannot be considered and no change will be made 
to the definition as a result of this comment.

H. Nonattainment Areas

1. Proposed Rule
    In the proposed rule, we addressed the issue of how to address 
nonattainment areas under the proposed FIP given that it only applies 
to attainment, attainment/unclassifiable and unclassifiable areas. It 
would not apply to any areas designated nonattainment. We indicated 
that the EPA or tribes will need to develop area-specific plans if and 
when areas of Indian country become nonattainment for ozone or other 
NAAQS pollutants. At that time, any such area that has oil and natural 
gas minor source activity may require additional controls on existing 
(and new and modified) sources in order to achieve attainment of the 
NAAQS. One source of potential control options will be the EPA's CTGs 
for oil and natural gas activity that the EPA has made available for 
comment and will finalize in 2016.\67\
---------------------------------------------------------------------------

    \67\ For more information, go to: https://www3.epa.gov/airquality/oilandgas/index.html.
---------------------------------------------------------------------------

2. Final Action
    The EPA has not made any changes to the final FIP's requirements as 
it relates to nonattainment areas. The FIP does not apply in such 
areas. Before or after such an area is designated as nonattainment, we 
will promulgate an area-specific FIP for existing sources if we 
determine that it is ``necessary or appropriate'' pursuant to the 
Tribal Authority Rule. At that time, we will determine whether the 
final FIP should apply in the area or whether something more is 
required and will include in the area-specific FIP a provision or 
provisions putting the FIP, or some variation thereof, into effect in 
the area. The public will have an opportunity to comment on any such 
expansion of coverage of this FIP in the separate, area-specific 
action.
3. Comments and Responses
    The following discussion contains comments on our proposal that the 
FIP does not apply in nonattainment areas and our responses. The 
comments and responses are also addressed in Section 4.0 of the RTC 
Document.
    Comment #29: Several commenters requested that the EPA include 
provisions in the FIP to allow for streamlined permitting of minor oil 
and natural gas sources in nonattainment areas, including permitting in 
areas during the transition period between the time an area is 
designated as nonattainment and the time a FIP to control emissions 
adequately in such nonattainment area is in place. One commenter noted 
that with the lowered ozone standard, this issue may become 
particularly problematic in certain areas, most notably the Uinta 
Basin. Commenters requested that the FIP continue to provide for minor 
source permitting in such areas until a basin-specific permitting 
program becomes effective under the implementation planning process. 
Because an attainment plan is not due until three years after an area 
becomes nonattainment, the absence of a vehicle to allow for continuing 
minor source permitting would require source-specific permits during 
this transition period and would disadvantage oil and natural gas 
development in Indian country. One commenter suggested that the FIP 
continue as the permitting vehicle during the transition period, and 
that the EPA develop area-specific FIPs for re-designated areas that 
would supersede the national FIP upon issuance.
    Response #29: The EPA recognizes the potential for certain tribal 
areas to be designated as nonattainment for the new ozone standard. 
Currently, the permitting mechanism in place under the Federal Indian 
Country Minor NSR rule for oil and natural gas sources wishing to 
locate in nonattainment areas is limited to source-specific permits. We 
believe that this FIP as designed will be protective of air quality in 
attainment, attainment/unclassifiable and unclassifiable areas, but 
will not necessarily be protective in nonattainment areas without 
further action to reduce emissions from existing sources. Therefore, we 
are stating our intent to potentially apply this national FIP's 
requirements as appropriate to nonattainment areas where the EPA has 
established a separate, area-specific FIP

[[Page 35969]]

action. In that separate, area-specific action we would propose--and 
seek comment on--the application of this FIP's requirements to new and 
modified true minor sources in those certain areas designated 
nonattainment.
    It is important to note that the geographic scope of this FIP 
cannot be extended to cover any nonattainment areas without the EPA 
first proposing to apply its requirements to such an area through a 
separate rulemaking subject to notice and an opportunity to comment. We 
are here merely expressing our intent to use the approach described 
above in the future to provide coverage for new and modified true minor 
sources in Indian country nonattainment areas, should such areas exist, 
where the EPA believes that the FIP, or some variation thereof, in 
combination with an area-specific FIP, is sufficient to protect air 
quality.
    Our expression of intent to consider adopting this FIP in 
nonattainment areas as an accompaniment to an area-specific FIP 
addressing existing sources is in direct response to comments 
requesting that this FIP be extended to tribal nonattainment areas at 
least for a period of time after designation and until it is replaced 
by another FIP that addresses new and modified sources. A factor in 
considering whether to extend the coverage of this FIP is if we believe 
that existing source emissions will be reduced to a great enough extent 
to allow room for further growth of the industry in the area, while 
also protecting air quality. As noted above, the public will have an 
opportunity to comment on any such expansion of coverage of this FIP in 
the separate, area-specific action.

I. How the EPA Selected Equipment Included in the Proposed FIP

1. Proposed Rule
    The proposed oil and natural gas FIP focused on the production 
segment of the oil and natural gas sector, because we believed this 
segment includes the majority of the true minor sources in the sector 
that would need to obtain a minor source permit in areas covered by the 
Federal Indian Country Minor NSR rule. In the preamble to the proposed 
rule, we described the natural gas production segment as ending where 
the natural gas enters a natural gas processing plant. In situations 
where there is no processing plant, the natural gas production segment 
ends at the point where the natural gas enters the transmission segment 
for long-line transport. The crude oil production segment ends at the 
storage and load-out terminal which is the point of custody transfer to 
an oil pipeline or for transport of the crude oil to a petroleum 
refinery via trucks or railcars. The petroleum refinery is not 
considered part of the oil and natural gas sector.
    In determining which equipment to include in the proposed oil and 
natural gas FIP, we reviewed the EPA regulations that apply to emission 
units within the oil and natural gas production segment. We have relied 
substantially on analyses performed in support of the 2015 proposed 
NSPS, subpart OOOOa, to help determine which emission units the EPA 
should consider regulating in the oil and natural gas sector in areas 
covered by the Federal Indian Country Minor NSR rule as part of this 
proposed FIP.\68\ In addition to the production segment sources 
proposed to be covered under NSPS, subpart OOOOa, in the proposed FIP, 
we proposed requirements from existing EPA standards for three emission 
sources not covered by the proposed NSPS, subpart OOOOa, because they 
are present at oil and natural gas production sites and emit 
NOX and/or VOC: Engines, process heaters and glycol 
dehydration units. Three of the six federal rules in the proposed FIP 
regulate these air emissions sources, among others. Therefore, we 
determined that a combination of existing federal regulations and the 
2015 proposed NSPS, subpart OOOOa, provides a comprehensive and 
consistent regulatory approach for addressing true minor oil and 
natural gas production sources in areas covered by the Federal Indian 
Country Minor NSR rule.
---------------------------------------------------------------------------

    \68\ ``Oil and Natural Gas Sector: Standards for Crude Oil and 
Natural Gas Facilities. Background Technical Support Document for 
the Proposed New Source Performance Standards 40 CFR part 60, 
subpart OOOOa,'' U.S. Environmental Protection Agency, August 2015, 
EPA-HQ-OAR-2010-0505-5021, http://www.regulations.gov.
---------------------------------------------------------------------------

    We concluded that these federal regulations include emission 
limitations that are technically and economically feasible, and cost 
effective because we have vetted the existing regulations via the 
public comment process and sources are currently complying with these 
federal standards, including new and modified sources in the oil and 
natural gas sector located in areas covered by the Federal Indian 
Country Minor NSR rule. The referenced NSPS are all promulgated 
pursuant to the EPA's authority under CAA section 111. Under CAA 
section 111(a), the emission limitations for all the affected sources, 
except process heaters and glycol dehydrators, ``reflect the degree of 
emission limitation achievable through the application of the best 
system of emission reduction which (taking into account the cost of 
achieving such reduction and any non-air quality health and 
environmental impact and energy requirements) the Administrator 
determines have been adequately demonstrated.'' We refer to this level 
of control as the Best System of Emission Reduction (BSER). In 
determining BSER, we typically conduct a technology review that 
identifies what emission reduction systems exist and how much they 
reduce air pollution in practice. For each control system identified, 
we also evaluate its costs and other impacts.
    The NESHAP for process heaters and glycol dehydrators are 
promulgated pursuant to the EPA's authority under CAA section 112. 
Under CAA section 112(d)(3), the emission limitations for glycol 
dehydrators and process heaters at major sources of hazardous air 
pollutants (HAPs) reflect the application of maximum achievable control 
technology (MACT). The MACT emission limitation for new sources cannot 
be less stringent than the emission control achieved in practice by the 
best-controlled similar source, without considering costs. In addition, 
under CAA section 112(d)(5), the emission reduction requirements for 
triethylene glycol dehydrators at area sources reflect ``generally 
available control technology'' (GACT). For GACT there is no statutory 
minimum level of emissions reduction for new or existing sources and 
costs can be considered. We proposed that the oil and natural gas FIP 
require sources to comply with the applicable MACT (for glycol 
dehydrators and process heaters located at major sources of HAP) or 
GACT (for glycol dehydrators located at area sources of HAP) emission 
limitations. Because the individual HAP pollutants regulated from 
glycol dehydrators by the NESHAP (and to some degree from process 
heaters, as well) for oil and natural gas production sources are also 
VOC, which are regulated NSR pollutants, the proposed FIP would create 
enforceable VOC reduction requirements for glycol dehydrators and 
process heaters. HAPs would serve as a surrogate for VOC with respect 
to emission limitations, monitoring, testing and compliance. In 
addition, compliance with the 40 CFR part 63, subpart DDDDD, MACT also 
provides beneficial reductions of other non-targeted NSR pollutants, 
i.e., NOX.
    We indicated that the rationale supporting the applicability, 
emission limitations, monitoring, recordkeeping, reporting, and other 
provisions for each of the six federal rules is found in the preambles 
and background documents

[[Page 35970]]

for those rulemakings. The six federal rules are available on the 
Electronic Code of Federal Regulations at: http://www.ecfr.gov/cgi-bin/ECFR?page=browse.
2. Final Action
    In response to comments, we are expanding the scope of the FIP to 
provide coverage of natural gas processing plants. In Sec.  49.102, we 
have modified the definition of oil and natural gas source (termed oil 
and natural gas production facility in the proposal) to facilitate this 
expansion.
    In part due to this expansion (resulting from our response to 
comments), we are also modifying Sec.  49.105 of the proposed FIP by 
adding two federal standards to the FIP's set of requirements:
     40 CFR part 63, subpart ZZZZ--NESHAP for Stationary 
Reciprocating Internal Combustion Engines; and
     40 CFR part 60, subpart KKKK--Standards of Performance for 
New Stationary Combustion Turbines.
    Adding these standards to the FIP will provide standards for 
combustion turbines at gas processing plants and expand the standards 
in the FIP covering reciprocating internal combustion engines.
3. Comments and Responses
    The following discussion contains comments related to how the EPA 
selected equipment included in the proposed FIP and our responses. The 
comments and responses are also addressed in Section 5.0 of the RTC 
Document.
    Comment #30: One commenter expressed concern that, in the absence 
of a FIP condition expressly requiring installation of equipment 
subject to the six other EPA rules included in the proposed FIP, a 
source could utilize second-hand equipment with no applicable NSPS or 
NESHAP requirement and, thus, operate with no control technology 
requirements or emission limitations as required by Sec.  49.154(c). 
The commenter recommended adding language to Sec. Sec.  49.101 and 
Sec.  49.105 expressly requiring installation of equipment subject to 
the six other rules included in the proposed FIP.
    Response #30: The EPA believes that the commenter's proposal is not 
workable as it would limit operators to only installing equipment that 
is regulated by an EPA standard. Mandating the use of equipment that 
meets an EPA standard runs contrary to the FIP's intent of applying a 
consistent set of national requirements across Indian country. In some 
instances sources may need to use a piece of equipment that is not 
subject to an EPA standard. Instead, our approach under the FIP is to 
require that equipment subject to one or more of the eight EPA 
standards comply with those standards for purposes of the FIP. As long 
as the equipment in question can meet the limits to which they are 
subject, regardless of the mechanism used to do so, the owner/operator 
should be able to use that equipment. We believe that this approach is 
sufficient to protect air quality in attainment, attainment/
unclassifiable and unclassifiable areas. No change will be made as a 
result of this comment.
    Comment #31: Three commenters asked the EPA to expand the scope of 
the proposed rule to include minor oil and natural gas sources outside 
the production segment. All three commenters requested that natural gas 
processing plants be added; two commenters requested that natural gas 
transmission and storage facilities be added, and one commenter 
requested that natural gas distribution facilities be added. One 
commenter asked the EPA to indicate whether it intends to regulate any 
or all of these segments in the future, and if so, what is the EPA's 
projected timetable. One commenter recommended that the language in 
Sec.  49.101(b)(1)(i) be modified to read:
    ``The facility is an oil and natural gas production facility or 
natural gas processing plant as defined in Sec.  49.102;''
    Response #31: In response to these comments, the EPA has determined 
to expand the regulatory language in the FIP to cover true minor 
natural gas processing plants. The EPA has added the requirements of 40 
CFR part 60, subpart KKKK, to the list of standards to cover turbines 
at compressor stations. The EPA notes that it is not necessary to add 
40 CFR 60, subpart KKK--Standards of Performance for Equipment Leaks of 
VOC From Onshore Natural Gas Processing Plants for Which Construction, 
Reconstruction, or Modification Commenced After January 20, 1984, and 
on or Before August 23, 2011, or 40 CFR part 60, subpart LL--Standards 
of Performance for SO2 Emission from Onshore Gas Processing 
for which Construction Commenced after January 20, 1984, and on or 
Before August 23, 2011. These rules are already included in the current 
FIP requirements because they are already included in the oil and 
natural gas NSPS rule at 40 CFR part 60, subpart OOOOa. The EPA is also 
adding the requirements of 40 CFR 63, subpart ZZZZ--National Emissions 
Standards for Hazardous Air Pollutants for Stationary Reciprocating 
Internal Combustion Engines to the FIP in the final rule. We are 
comfortable with including these additional facilities under the FIP to 
cover true minor natural gas processing facilities because the rules 
will require adequate control and we do not feel that source-specific 
review is necessary just as we do not regard it as necessary (unless we 
make an exception for air quality concerns) for true minor sources in 
the oil and natural gas production segment of the oil and natural gas 
sector.
    With respect to the timetable for any future regulation of the oil 
and natural gas sector, all segments in the sector are already subject 
to regulation by the EPA under the Federal Indian Country Minor NSR 
rule. However, only certain segments are included in this FIP because 
we believe that the vast majority of true minor sources in the oil and 
natural gas sector are in the oil and natural gas production and 
natural gas processing segments of the sector.
    Comment #32: One commenter stated that the proposed definition for 
``oil and natural gas production facility'' should be revised to 
exclude references to mobile and temporary sources, such as well 
drilling, completion, workover activities, and portable non-self-
propelled equipment because the CAA expressly precludes application of 
NSR and title V to mobile sources, such as portable, engine-powered 
well-drilling equipment and portable reciprocating internal combustion 
engines. The commenter recommended that the EPA should make it clear 
that these sources are not subject to air permitting requirements under 
the oil and natural gas FIP. This same commenter stated that the 
proposed oil and natural gas production facility definition does not 
include common unit operations such as water treatment, sweetening 
units (acid gas removal units), truck loading, and dew point 
suppression skids. The commenter noted that language such as ``low to 
medium pressure, small diameter'' are arbitrary descriptions for 
gathering pipelines, and that these equipment are better described by 
purpose (i.e., to gather field gas). The commenter recommended the 
following change to the oil and natural gas production facility 
definition. They recommended the following additions and deletions:
     Adding ``water'' to the list of materials to be separated 
or treated;
     Adding the following items to the list of production 
components: Natural gas sweetening, truck loading. and dew point 
suppression skids; and
     Deleting the following items from the list of production 
components: Well drilling, completion and workover

[[Page 35971]]

processes and portable non-self-propelled apparatuses associated with 
those operations; and low to medium pressure, smaller diameter, 
gathering pipelines and related components that collect and transport 
the oil, natural gas and other materials and wastes from the wells or 
well pads.
    Response #32: The EPA has replaced the definition of ``oil and 
natural gas production facility'' in Sec.  49.102 as proposed with 
``oil and natural gas source.'' The new definition incorporates some of 
the suggestions recommended by the commenter. We did not include the 
segments of transmission or distribution of natural gas in the 
definition because they do not fall within the scope of coverage of 
this FIP.\69\ However, we believe that completion and workover 
processes should not be removed from the definition because they are 
stationary sources regulated under 40 CFR part 60, subpart OOOOa. This 
makes the treatment of these sources under the FIP definition (Sec.  
49.102) consistent with definitions related to the oil and natural gas 
sector in 40 CFR part 60, subpart OOOOa; 40 CFR part 63, subpart HH; 
and the FBIR FIP.
---------------------------------------------------------------------------

    \69\ This FIP only covers the oil and natural gas production and 
natural gas processing segments of the oil and natural gas sector 
because we believe that the vast majority of true minor sources in 
the oil and natural gas sector are in those two segments.
---------------------------------------------------------------------------

    Comment #33: One commenter recommended that specific oil and 
natural gas exploration and production equipment be regulated under the 
proposed FIP. Specific equipment recommended for inclusion in the FIP 
includes: Drill rigs, liquids unloading, dehydrators, truck loadout, 
and phase separation. The commenter recommended that plunger lifts be 
required for all liquids unloading. The commenter recommended that 
dehydrators be required to control VOC by 95 percent by using a 
condenser.
    Response #33: The EPA feels that the original suite of six federal 
rules proposed to be included in the FIP, in conjunction with the two 
additional federal rules added under this final action, combine to 
adequately control emissions from oil and natural gas facilities for 
purposes of the FIP. It should be noted that drilling rig engines are 
not considered stationary sources for purposes of permitting under the 
Federal Indian Country Minor NSR rule, and dehydrators are addressed 
under 40 CFR part 63, subpart HH (National Emission Standards for 
Hazardous Air Pollutants from Oil and Natural Gas Production 
Facilities), which is one of the eight federal rules included in the 
FIP. No change has been made as a result of this comment.
    Comment #34: One commenter recommended that the proposed FIP 
include regulation of emissions from well completions for both oil and 
natural gas wells, as well as casinghead gas and associated gas 
emissions. The commenter referenced recommendations in an ICF 
International report (ICF International, Economic Analysis of Methane 
Emission Reduction Opportunities in the U.S. Onshore Oil and Natural 
Gas Industries (March 2014), at 3-3, available at: http://www.edf.org/sites/default/files/methane_cost_curve_report.pdf).
    Response #34: The FIP includes the recently revised Standards of 
Performance for New and Modified Sources in the Oil and Natural Gas 
Sector (40 CFR part 60, subpart OOOOa), which requires control of oil 
and natural gas well completions for hydraulically fractured wells. 
Casinghead gas and associated gas emissions from venting or flaring 
during ongoing production are not currently addressed under the eight 
federal rules included in the final FIP; however, if those emissions 
sources are regulated under a future revision of subpart OOOOa, then 
they would automatically fall under the requirements of this FIP at 
true minor sources. No change has been made as a result of this 
comment.
    Comment #35: Two commenters recommended that the EPA clarify the 
definition of natural gas processing plant by revising it to be 
consistent with the definition in other air rules. Both commenters 
stated that the EPA should clarify that a Joule-Thompson valve, dew 
point depression valve, or an isolated or standalone Joule-Thompson 
skid does not make a site a natural gas processing plant. Both 
commenters recommended that the EPA reference or include in Sec.  
49.102 the definition of a natural gas processing plant contained in 40 
CFR part 60, subpart OOOO (Sec.  60.5430).
    Response #35: The FIP proposal did not include a definition of 
natural gas processing plant. In this final action we are modifying 
Sec.  49.102 to revise the definition of an ``oil and natural gas 
production facility'' (now ``oil and natural gas source'') to make the 
treatment of these sources under the FIP definition (Sec.  49.102) 
consistent with definitions related to the oil and natural gas sector 
in 40 CFR part 60, subpart OOOOa; 40 CFR part 63, subpart HH; and the 
FBIR FIP. We have also included natural gas processing plant as part of 
the definition of ``oil and natural gas source'' under Sec.  49.102.
    One of the two commenters recommending including the definition of 
gas processing plant from 40 CFR part 60, subpart OOOO, provided 
incorrect language for the definition. Nonetheless, we have concluded 
that adding a definition for natural gas processing plant to the FIP is 
unnecessary; including natural gas processing plant in the definition 
of source is sufficient to extend the coverage of this FIP to non-major 
natural gas processing plants. At the beginning of Sec.  49.102 we make 
it clear that all terms not defined in the section shall have the 
meaning given them in 40 CFR part 60, subpart OOOOa, among other 
sources, which would include how natural gas processing plant is 
defined in the subpart.
    Comment #36: One commenter noted that the current list of 
referenced federal NSPS and NESHAP regulations does not include 40 CFR 
part 63, subpart ZZZZ--National Emission Standards for Hazardous Air 
Pollutants for Stationary Reciprocating Internal Combustion Engines. 
The commenter stated that the EPA should make it clear in the preamble 
and ensure that no regulatory language of the FIP excludes oil and 
natural gas sources from relying on subpart ZZZZ to limit the PTE of 
engines to be able to qualify for the FIP. The commenter recommended 
that subpart ZZZZ be included in the list of referenced rules (at Sec.  
49.105(g)) as follows:
    ``For sources that are subject to subpart ZZZZ, National Emission 
Standards for Hazardous Air Pollutants for Stationary Reciprocating 
Internal Combustion Engines, for purpose of this FIP, sources must 
comply with all of the applicable provisions of the standard as written 
as of [INSERT DATE OF FINAL PROMULGATION OF O&G FIP]:''
    Response #36: The EPA has included the requirements of 40 CFR part 
63, subpart ZZZZ, into the final FIP as requested by the commenter. As 
with all of the appplicable requirements from all eight of the 
regulations referenced in this FIP, a source can rely on the reductions 
required by 40 CFR part 63, subpart ZZZZ, to reduce its PTE.
    Comment #37: One commenter recommended that the FIP require all new 
compressor engines to install steam injection and control technologies 
such as low-emission combustion retrofit, selective catalytic reduction 
(SCR), or selective non-catalytic reduction (SNCR) and to require 
existing sources to retrofit with the appropriate control. The 
commenter further recommended that the EPA should require the use of 
electric motors for new engines unless the operator shows it is 
infeasible to do

[[Page 35972]]

so. One commenter recommended that the FIP require all external 
combustion units to control NOX emissions with SNCR, SCR, or 
a combination of SCR plus low NOX burners.
    Response #37: The proposed FIP incorporates control requirements 
for internal and external combustion units in accordance with 40 CFR 
part 63, subpart DDDDD (National Emission Standards for Hazardous Air 
Pollutants for Major Sources: Industrial, Commercial, and Institutional 
Boilers and Process Heaters); 40 CFR part 63, subpart ZZZZ (National 
Emissions Standards for Hazardous Air Pollutants for Stationary 
Reciprocating Internal Combustion Engines); 40 CFR part 60, subpart 
IIII (Standards of Performance for Stationary Compression Ignition 
Internal Combustion Engines); 40 CFR part 60, subpart JJJJ (Standards 
of Performance for Stationary Spark Ignition Internal Combustion 
Engines); and 40 CFR part 60, subpart KKKK (Standards of Performance 
for New Stationary Combustion Turbines). In the development of the FIP, 
we have relied on the analysis conducted in the development of these 
existing rules to determine adequate control technology requirements 
for these types of sources. The FIP only applies to new true minor 
sources and modifications at existing true minor sources thus does not 
address the control of emissions from existing source.

J. Pollutants Included in the Proposed FIP

1. Proposed Rule
    In the preamble to the proposed rule, we indicated that the 
pollutants emitted from the activities regulated through the proposed 
Federal Indian Country Minor NSR rule (regulated NSR pollutants) 
include: VOC, NOX, SO2, PM, PM10, 
PM2.5, H2S, CO and various sulfur compounds. 
Hydrogen sulfide and SO2 are emitted from production and 
processing operations that handle and treat sour gas.\70\
---------------------------------------------------------------------------

    \70\ Sour gas is natural gas with more than 5.7 milligrams of 
H2S per normal cubic meters (0.25 grains/100 standard 
cubic feet), see AP-42 Compilation of Air Pollutant Emission 
Factors, Chapter 5.0 Introduction to Petroleum Industry, Section 5.3 
Natural Gas Processing, available at: http://www.epa.gov/ttnchie1/ap42/ch05/final/c05s03.pdf.
---------------------------------------------------------------------------

2. Final Action
    In the final FIP, there is no change in the pollutants covered.
3. Comments and Responses
    The following discussion contains comments related to the 
pollutants included in the proposed FIP and our responses. The comments 
and responses are also addressed in Section 6.0 of the RTC Document.
    Comment #38: One commenter recommended that the EPA expand the 
pollutants regulated in the proposed FIP to include methane. The 
commenter noted that, in the proposed FIP, the EPA states that it will 
include the requirements of the proposed, amended 40 CFR part 60, 
subpart OOOOa, in the FIP. The commenter stated that adding methane to 
the list of pollutants covered by the rule would provide operators and 
tribes with certainty that the parts of the NSPS rule governing methane 
emissions also apply in Indian country.
    Response #38: The Federal Indian Country Minor NSR rule does not 
regulate GHGs, which include methane. The FIP is implementing the 
Federal Indian Country Minor NSR rule for the oil and natural gas 
sector, and, therefore, does not regulate GHGs. However, it is worth 
noting that, while the rule does not directly regulate methane, any 
controls that effectively control VOC emissions will also control 
methane emissions. In addition, in the event that subpart OOOOa as 
adopted requires control of methane, methane emissions will be reduced. 
No change has been made as a result of this comment.

K. Exclusion of Existing Sources From the Proposed Oil and Natural Gas 
FIP

1. Proposed Rule
    In the proposed rule, the EPA indicated that, while the Federal 
Indian Country Minor NSR rule only addresses new and modified sources, 
including such sources in the oil and natural gas sector, the EPA 
believes that managing emissions from existing oil and natural gas 
sources in some areas of Indian country also may be important. This is 
because of the significant emissions associated with existing activity 
in the oil and natural gas sector in some areas of Indian country and 
the resultant need to protect public health and the environment. 
Addressing existing sources through a FIP could be useful in areas of 
Indian country for which surrounding state requirements apply to 
existing oil and natural gas sources located on lands that are within a 
state's jurisdiction. In doing so, EPA would consider tribes' views and 
interests, including any interest in promoting economic development.
    While EPA believes that it has the necessary authority to 
promulgate a FIP regulating existing sources should it determine that 
it is necessary or appropriate to do so, in the September 2015 action, 
we proposed that the FIP only apply to new and modified true minor 
sources in the production segment of the oil and natural gas sector. In 
the proposed rule, we indicated that the proposed FIP for new and 
modified true minor sources in the oil and natural gas production 
segment locating or located in Indian reservations (and other areas of 
Indian country over which an Indian tribe, or the EPA, has demonstrated 
that the tribe has jurisdiction) would apply to all such areas 
designated attainment, attainment/unclassifiable, or unclassifiable. It 
would not apply to any areas designated nonattainment. The Federal 
Indian Country Minor NSR rule allows us to manage minor source emission 
increases in Indian country and to ensure that new source emissions do 
not cause or contribute to a NAAQS or PSD increment violation. We are 
concerned that the rapid growth of the oil and natural gas production 
segment, in combination with existing exploration and production 
activities, could result, or in some cases already has resulted, in 
adverse air quality impacts, especially in light of the approximately 
6,300 existing true minor source registrations received in the EPA 
Region 8 Office for facilities in the oil and natural gas sector.\71\ 
However, we believe that the most appropriate means for addressing 
impacts from existing sources is through area- or reservation-specific 
FIPs and not through a national FIP. If we determine that it is 
``necessary or appropriate'' to exercise our discretionary authority 
under sections 301(a) and 301(d)(4) of the CAA and 40 CFR 49.11(a) of 
our implementing regulations, we will publish a proposed area- or 
reservation-specific FIP that provides an opportunity for full public 
review and comment. At a minimum, the EPA or tribes will need to 
develop area-specific plans if and when areas of Indian country become 
nonattainment for ozone or other NAAQS pollutants. At that time, any 
such area that has oil and natural gas minor source activity may 
require additional controls on existing (and new and modified) sources 
in order to achieve attainment of the NAAQS. One source of information 
for control options will be the EPA's control techniques guidelines 
(CTGs) for oil and natural gas activity that the EPA

[[Page 35973]]

has made available for comment and will finalize in 2016.\72\
---------------------------------------------------------------------------

    \71\ In the Federal Indian Country Minor NSR rule, EPA 
established a registration program that required owners/operators of 
existing true minor sources to file a one-time registration with the 
appropriate Reviewing Authority by March 1, 2013. The EPA's Region 8 
Office has received about 6,300 registrations from true minor 
sources in the oil and natural gas sector. This far exceeded the 
amount received from sources in any other category.
    \72\ For more information, go to: https://www3.epa.gov/airquality/oilandgas/index.html.
---------------------------------------------------------------------------

    We believe that existing sources are best addressed through 
tailored, federal or tribal air quality plans because each basin 
producing oil and/or natural gas possesses different geological and 
meteorological characteristics and, thus, the primary fossil fuel 
resource extracted can be very different in quality and type and the 
impacts from emissions associated with extraction activities can vary 
widely. For example, the predominant resource extracted from the Bakken 
Pool \73\ is a light, volatile oil, while the primary resource 
extracted from the Uintah Basin is a heavy, thick oil. Each of these 
types, in many cases, call for different sets of control requirements 
that are best addressed through tailored plans versus a national FIP.
---------------------------------------------------------------------------

    \73\ Bakken Pool means oil produced from the Bakken, Three 
Forks, and Sanish formations.
---------------------------------------------------------------------------

    We believe that through tailored plans a number of cost-effective 
emission reduction measures could be applied to existing emission units 
to balance new growth by mitigating the potential for adverse air 
quality impacts from overall increases in emissions. A number of state 
air pollution control agencies already regulate some existing emissions 
from this segment.\74\ For example, in February 2014, Colorado adopted 
additional regulations for oil and natural gas production operations 
that include such requirements as expanding nonattainment area 
pneumatic controller requirements statewide and reducing venting and 
flaring of gas streams at well sites, among other control 
strategies.\75\ In addition, these regulations determined leak 
detection and repair monitoring to be cost effective at oil and natural 
gas production facilities. Some technologies may even provide the 
industry with cost savings due to recovered product. For example, the 
EPA's Natural Gas Star program estimates that adding a vapor recovery 
unit to a storage tank could pay for itself in 3 to 37 months, and 
thereafter result in cost savings.\76\
---------------------------------------------------------------------------

    \74\ See, e.g., L. Gribovicz, WRAP, ``Analysis of States' and 
EPA Oil and Gas Air Emissions Control Requirements for Oil and Gas 
Emissions Control Requirements for Selected Basins in the Western 
United States (2013 Update),'' Nov. 8, 2013, available at http://www.wrapair2.org/pdf/2013-11x_O&G%20Analysis%20(master%20w%20State%20Changes%2011-08).pdf.
    \75\ See Colorado Dept. of Public Health and Environment, Air 
Quality Control Commission Web site at http://www.colorado.gov/cs/Satellite/CDPHE-AQCC/CBON/1251647985820.
    \76\ See ``Lessons Learned from Natural Gas STAR Partners; 
Installing Vapor Recovery Units on Storage Tanks,'' available at 
http://epa.gov/gasstar/documents/ll_final_vap.pdf on the EPA's 
Natural Gas Star Web site: http://epa.gov/gasstar/index.html.
---------------------------------------------------------------------------

2. Final Action
    The final FIP does not address existing oil and natural gas 
sources. As we discussed in our proposal, this FIP is used in lieu of 
source-specific permits to fulfill our requirement under the Federal 
Indian Country Minor NSR rule to issue pre-construction permits to new 
and modified sources. Further, when we proposed the Federal Indian 
Country Minor NSR rule on August 21, 2006, we asked for comment on how 
to address existing sources and we presented four options.\77\ Of the 
proposed options, in response to comments, we chose to require that 
existing sources have to register with their Reviewing Authority, 
including the submittal of emissions data, with no additional 
requirements, unless they modify the existing source. While one of the 
options presented was not to include any requirements for existing 
sources, and would have been more consistent with state minor NSR 
programs, we stated that collecting source emissions data was necessary 
to successfully implement the minor source program. We still believe 
that to be the case today and that an area-specific FIP is the most 
appropriate way to address emissions from existing sources.
---------------------------------------------------------------------------

    \77\ ``Review of New Sources and Modifications in Indian 
Country,'' U.S. Environmental Protection Agency, 71 FR 48696, August 
21, 2006, https://www.gpo.gov/fdsys/pkg/FR-2006-08-21/pdf/06-6926.pdf.
---------------------------------------------------------------------------

    In addition, we are indicating in this final action that in the 
future (subject to notice and comment) the requirements of this FIP may 
be extended to certain areas designated nonattainment for which the EPA 
has issued an area-specific FIP. This possible, future extension of 
coverage of this FIP could provide a mechanism for the EPA to provide 
streamlined permitting in nonattainment areas where we have addressed 
existing sources, providing air quality protection and a way to allow 
continued oil and natural gas growth in Indian country where it 
represents an important source of tribal government revenue. So, while 
we are not regulating existing sources in this action, we do believe 
that existing sources will need to be addressed before new and modified 
emissions can occur in nonattainment areas.
    Finally, on March 10, 2016, the Obama Administration and the EPA 
announced the next step in reducing emissions of methane from the oil 
and natural gas industry: Moving to regulate emissions from existing 
sources. The agency is beginning with a formal process to require 
companies operating existing oil and natural gas sources to provide 
information to assist in the development of comprehensive regulations 
to reduce methane emissions.\78\
---------------------------------------------------------------------------

    \78\ For more information, go to: http://www3.epa.gov/airquality/oilandgas/methane.html.
---------------------------------------------------------------------------

3. Comments and Responses
    The following discussion contains comments related to the exclusion 
of existing sources from the proposed FIP and our responses. The 
comments and responses are also addressed in Section 7.0 of the RTC 
Document.
    Comment #39: Several commenters submitted comments on the subject 
of regulating existing sources in the proposed FIP. Three commenters 
recommended that the EPA regulate existing sources; one commenter 
recommended that the EPA create a voluntary process for existing 
sources to register and to be regulated under the FIP; three commenters 
agreed with the EPA's position not to regulate existing sources; and 
one commenter recommended that the EPA regulate existing sources only 
in the context of area-specific rules. One of the commenters favoring 
the regulation of existing sources noted that there is substantial 
evidence demonstrating that existing oil and natural gas sources are 
responsible for considerable air pollution emissions within Indian 
country, and that a FIP is the only method by which the EPA may 
regulate existing sources. This commenter further noted that many areas 
of Indian country are already in nonattainment despite the six 
regulations already in place, and that it might be necessary for the 
EPA to regulate existing sources in other areas in order to prevent 
them from slipping into nonattainment. One of the commenters 
recommended that the EPA develop an approach for regulating existing 
true minor source oil and natural gas facilities in Indian country 
apart from the Proposed Rule that not only takes into account those 
parts of Indian country where the EPA finds an area- or reservation FIP 
is necessary for existing sources, but addresses existing sources 
throughout all of Indian country. Such an approach could include the 
use of FIPs, general permits, or permits by rule.
    The three commenters requesting that the EPA not regulate existing 
sources recommended that regulation of existing sources should be 
addressed in the context of area-specific rulemakings, developed on a 
regional basis in a way that reflects local air quality 
characteristics, current air quality data,

[[Page 35974]]

and emissions inventories. One of the commenters requesting that the 
EPA address existing sources in the context of area-specific 
rulemakings suggested that not all existing minor sources should be 
regulated in the same manner; the EPA should target those sources most 
directly contributing to air quality degradation. This commenter 
further recommended that, should the EPA choose to regulate existing 
sources, the EPA should apply control requirements to existing source 
emissions in a flexible manner, gradually increasing enforcement as 
appropriate.
    Response #39: The purpose of the proposed FIP was to address pre-
construction permitting for new and modified true minor sources 
locating or located in reservation areas of Indian country and other 
areas of Indian country over which a tribe has jurisdiction in order to 
satisfy the requirements of the Federal Indian Country Minor NSR rule. 
We chose this approach both because of our concern that the number of 
applications for source-specific permits from true minor sources in the 
oil and natural gas sector would overwhelm the available resources of 
the Reviewing Authority and to provide consistency in the regulation of 
such sources throughout the areas where the Federal Indian Country 
Minor NSR rule is in effect. The proposed FIP does not address existing 
sources, unless they undergo modification. We see no reason to change 
that in the final FIP. Rather, as discussed above, we believe the best 
way to address emissions from existing sources is through a 
reservation- or area-specific FIP if and when we determine that one is 
necessary or appropriate to protect air quality. In addition to 
satisfying the requirements of the Federal Indian Country Minor NSR 
rule, we believe that the final FIP addressing only new and modified 
true minor sources in the oil and natural gas production and natural 
gas processing segments of the oil and natural gas sector is sufficient 
to protect air quality in all of the areas to which it applies 
regardless of the current level of oil and natural gas production and 
natural gas processing activities in any particular area. The exception 
to this statement is the Uintah and Ouray Reservation in Utah. For the 
Uintah and Ouray Reservation, we have sufficient concerns with the 
impact of emissions from existing sources that we plan to propose a 
separate reservation-specific FIP addressing such sources. Similarly, 
we will consider promulgating such reservation- or area-specific FIPs 
in the future as we believe necessary or appropriate to protect air 
quality.
    Comment #40: One commenter recommended that specific existing oil 
and natural gas production equipment be regulated under the proposed 
FIP, including: Reciprocating compressors, centrifugal compressors, 
liquids unloading at existing wells, glycol dehydrators, liquid storage 
vessels, and pneumatic controllers.
    The commenter recommended that the EPA require: (1) The replacement 
of the rod packing of existing reciprocating compressors every 36 
months or 26,000 hours of operation; (2) replacement of wet seal 
configurations on centrifugal compressors with one that utilizes dry 
seals or that captures the emissions from the oil degassing unit; (3) 
that plunger lifts be required for all liquids unloading; (4) that 
dehydrators control VOC by 95 percent with a condenser; (5) that 
storage vessels capture VOC emissions via a closed vent system and 
route those emissions to a beneficial use; and (6) that high bleed 
pneumatic controllers be replaced with low-bleed controllers except 
when technically necessary.
    Response #40: As stated above, the purpose of the FIP, as proposed 
and as finalized herein, is to satisfy the requirements of the Federal 
Indian Country Minor NSR rule, and not to regulate existing sources.
    Comment #41: One commenter recommended that the proposed FIP be 
revised to require regular Leak Detection and Repair (LDAR) surveys at 
all new and existing facilities, including well pads, other production 
facilities, gathering compressor stations, and natural gas processing 
plants that are not covered under 40 CFR part 60, subparts KKK and 
OOOO. This commenter recommended that instrument-based LDAR surveys be 
carried out quarterly on all sources in the production segment and that 
auditory, visual, and olfactory inspections should be performed 
monthly.
    Response #41: The EPA proposed to add LDAR requirements for well 
sites and compressor stations, including gathering and boosting 
stations, to 40 CFR part 60, subpart OOOOa, rule in September 2015.\79\ 
As those requirements have been incorporated into the final subpart 
OOOOa regulation \80\--and, thus, the FIP--any LDAR requirements 
finalized under 40 CFR part 60, subpart OOOOa, are part of the FIP. 
Thus, new and modified true minor sources subject to the FIP will be 
required to comply with certain LDAR requirements. As noted in response 
to Comments #39 and #40, and for the reasons stated therein, we did not 
propose to regulate existing sources under the FIP, and the final FIP 
does not regulate existing sources.
---------------------------------------------------------------------------

    \79\ ``Oil and Natural Gas Sector: Emission Standards for New 
and Modified Sources in the Oil and Natural Gas Sector,'' U.S., 
Environmental Protection Agency, 80 FR 56593, September 18, 2015, 
https://www.gpo.gov/fdsys/pkg/FR-2015-09-18/pdf/2015-21023.pdf.
    \80\ ``Oil and Natural Gas Sector: Emission Standards for New, 
Reconstructed and Modified Sources,'' signed May 12, 2016, http://www.epa.gov/airquality/oilandgas/actions.html.
---------------------------------------------------------------------------

L. General Comments (e.g., Administrative, Incorporation by Reference)

1. Proposed Rule
    The proposed FIP proposed to require that owners/operators of oil 
and natural gas production facilities comply with six federal rules, as 
applicable, to reduce emissions of certain pollutants from certain 
equipment and processes present at oil and natural gas sources. For 
purposes of the proposed FIP, we proposed that compliance with these 
rules would effectively satisfy the NSR permitting requirement. 
Therefore, we proposed that true minor oil and natural gas sources 
subject to these applicable standards would have to comply with these 
standards as they currently exist and as they may be amended in the 
future, except for those provisions that we specifically excluded. (The 
proposed FIP would not have changed the applicability of the specified 
standards, nor would it have relieved sources subject to the standards 
from having to comply with them, independently of the proposed FIP.)
2. Final Action
    In the final FIP, we are using the same approach that we proposed: 
To satisfy the FIP, sources must comply with the requirements of the 
six federal standards (and two other standards, which are being added 
in response to comments), to the extent that they apply, as they exist 
at the time construction begins.
3. Comments and Responses
    The following discussion contains comments related to general 
comments and our responses. The comments and responses are also 
addressed in Section 8.0 of the RTC Document.
    Comment #42: One commenter noted that the proposed language for 
Sec.  49.105 requires that oil and natural gas sources using the FIP 
registration process comply with six specific federal NSPS

[[Page 35975]]

and NESHAP regulations. The commenter stated that ``The proposed rule 
appears to make an ``evergreen'' incorporation by reference--i.e., 
whenever the oil and natural gas FIP is invoked, the rule appears to 
require application of the then-current version of each incorporated 
regulation.'' The commenter stated that it is beyond the EPA's 
authority to make an evergreen incorporation by reference because any 
amendment of the incorporated rules would result in an amendment to the 
oil and natural gas FIP, which effectively would be accomplished 
without notice and comment rulemaking for the FIP. The commenter 
recommended that the EPA incorporate into the oil and natural gas FIP 
the rules as they stand at the time the FIP is promulgated, noting that 
the FIP can easily be amended later if significant changes are made to 
the underlying rules. The commenter recommended that the text of Sec.  
49.105 be revised to directly incorporate by reference each of the six 
rules.
    Response #42: The EPA notes that, under 1 CFR part 51, it cannot 
incorporate other regulations by references. It believes the proposed 
approach to including the NSPS and NESHAP standards in the FIP is the 
most efficient method of maintaining consistency with the applicable 
standards. Having to amend the FIP every time a standard is changed 
would be burdensome and create ambiguity for sources. We disagree that 
we lack the authority to adopt this approach through notice and comment 
rulemaking. While some of the requirements with which sources must 
comply may change over time, this does not result in a de facto 
amendment of the FIP. Rather, the FIP at all times requires compliance 
with the eight other rules, to the extent that they apply. Even in the 
absence of the FIP, sources subject to any of the eight other rules 
would be required to comply with those standards as they exist at the 
time the source begins construction. The public will have ample 
opportunity to comment on any proposed changes to the standards 
themselves. No changes have been made as a result of this comment.
    Comment #43: One commenter noted that there is a typographical 
error in the reference to the proposed 40 CFR part 60, subpart OOOOa, 
standard; the word ``applicable'' should be included, as it is in the 
references to the other five regulations.
    Response #43: The EPA has corrected the error in the final rule.

M. Other Comments

    The following discussion contains comments that did not fall into 
another section and were not covered by the proposal but merit a 
response. The comments and responses are also addressed in Section 9.0 
of the RTC Document.
    Comment #44: One commenter stated that the final rule should not 
implement a setback requirement. The commenter stated that including a 
setback requirement undermines tribal sovereignty, contravenes explicit 
requirements embodied in existing Indian mineral leases, and is 
contrary to existing BIA regulations. The commenter also noted that the 
EPA cannot exceed the authority granted by Congress. The commenter 
characterized setback requirements as unnecessary regulations, stating 
that the tribes can determine the appropriate setback distance.
    Response #44: There was no setback requirement in the proposed FIP, 
and the EPA is not adding a setback requirement in the final rule. No 
changes have been made as a result of this comment.
    Comment #45: Two commenters submitted comments on whether state 
requirements should be the basis for the FIP requirements. One 
commenter recommended that, if the EPA chooses not to regulate existing 
sources throughout Indian country, then the EPA should at least 
regulate existing sources located in states that already do so. The 
commenter noted that putting state and tribal lands on a level playing 
field will protect the health of tribal members. The commenter also 
noted that, in order to comply with the requirements of Executive Order 
12898, the EPA should regulate existing sources on tribal lands that 
are located within states that already regulate existing sources. 
Another commenter stated that it is not appropriate to apply state 
regulations to Indian country. Reservation- or region-specific FIPs 
should be developed that address tribes' concerns and the unique 
characteristics of the regions or reservations at issue.
    Response #45: As discussed above, and for the reasons stated, the 
FIP does not regulate existing sources. Further, a mere desire to 
``level the playing field'' is not a sufficient, sole basis for 
imposing requlatory requirements on oil and natural gas source owners/
operators. Rather, the EPA would need to determine that the state law 
requirements in question were necessary or appropriate. No changes have 
been made as a result of this comment.

V. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    This action is not a significant regulatory action and was, 
therefore, not submitted to the Office of Management and Budget (OMB) 
for review.

B. Paperwork Reduction Act (PRA)

    This action does not impose any new information collection burden 
under the PRA. OMB has previously approved the information collection 
activities contained in the Federal Indian Country Minor NSR rule and 
has assigned OMB control number 2060-0003. This action establishes a 
FIP which serves as a mechanism for true minor sources in the oil and 
natural gas production and natural gas processing segments of the oil 
and natural gas sector locating or located in areas covered by the 
Federal Indian Country Minor NSR rule to satisfy the requirements of 
that rule other than by obtaining a source-specific minor source 
permit. Because it substitutes for a source-specific permit, which 
would contain information collection activities covered by the 
Information Collection Request for Federal Indian Country Minor NSR 
rule issued in July 2011, it does not impose any new obligations or 
enforceable duties on any state, local or tribal government or the 
private sector. In addition, the information collection activities 
contained in the eight rules that are referenced in this FIP have also 
been previously approved by OMB.\81\
---------------------------------------------------------------------------

    \81\ 40 CFR part 60, subpart Kb: Standards of Performance for 
Volatile Organic Liquid Storage Vessels (Including Petroleum Liquid 
Storage Vessels) for Which Construction, Reconstruction, or 
Modification Commenced After July 23, 1984 (OMB Control No. 2060-
0074); 40 CFR part 60, subpart IIII: Standards of Performance for 
Stationary Compression Ignition Internal Combustion Engines (OMB 
Control No. 2060-0590); 40 CFR part 60, subpart JJJJ: Standards of 
Performance for Stationary Spark Ignition Internal Combustion 
Engines (OMB Control No. 2060-0610); 40 CFR part 60, subpart OOOOa: 
Standards of Performance for Crude Oil and Natural Gas Facilities 
for which Construction, Modification, or Reconstruction Commenced 
after September 18, 2015 (OMB Control No. 2060-0673); 40 CFR part 
63, subpart DDDDD: National Emission Standards for Hazardous Air 
Pollutants for Major Sources: Industrial, Commercial, and 
Institutional Boilers and Process Heaters (OMB Control No. 2060-
0616); 40 CFR part 63, subpart HH: National Emission Standards for 
Hazardous Air Pollutants from Oil and Natural Gas Production 
Facilities (OMB Control No. 2060-0417); 40 CFR part 63, subpart 
ZZZZ: National Emission Standards for Hazardous Air Pollutants for 
Stationary Reciprocating Internal Combustion Engines (OMB Control 
No. 2060-0548); and 40 CFR part 60, subpart KKKK: Standards of 
Performance for New Stationary Combustion Turbines (OMB Control No. 
2060-0582).

---------------------------------------------------------------------------

[[Page 35976]]

C. Regulatory Flexibility Act (RFA)

    I certify that this action will not have a significant economic 
impact on a substantial number of small entities under the RFA. In 
making this determination, the impact of concern is any significant 
adverse economic impact on small entities. An agency may certify that a 
rule will not have a significant economic impact on a substantial 
number of small entities if the rule relieves regulatory burden, has no 
net burden or otherwise has a positive economic effect on the small 
entities subject to the rule. The EPA analyzed the impact on small 
entities of streamlined permitting under the Federal Indian Country 
Minor NSR rule \82\ and determined that it would not have a significant 
economic impact on a substantial number of small entities. (By allowing 
sources to avoid having to obtain source-specific permits, this FIP 
also relieves regulatory burden.) This action merely implements a 
particular aspect of the Federal Indian Country Minor NSR rule. We 
have, therefore, concluded that this action will have no net regulatory 
burden for all directly regulated small entities.
---------------------------------------------------------------------------

    \82\ ``Review of New Sources and Modifications in Indian 
Country,'' U.S. Environmental Protection Agency, 76 FR 38748, July 
1, 2011, https://www.federalregister.gov/articles/2011/07/01/2011-14981/review-of-new-sources-and-modifications-in-indian-country.
---------------------------------------------------------------------------

D. Unfunded Mandates Reform Act (UMRA)

    This action does not contain any unfunded mandates, as described in 
UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect 
small governments. The action imposes no enforceable duty on any state, 
local or tribal government or the private sector. It simply provides 
one option for sources to comply with the Federal Indian Country Minor 
NSR rule. The Federal Indian Country Minor NSR rule itself, not this 
FIP, imposes the obligation that true minor sources in areas covered by 
the Federal Indian Country Minor NSR rule obtain a minor source NSR 
permit prior to commencing construction. This FIP merely provides a 
streamlined mechanism for meeting that obligation.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It would not 
have substantial direct effects on the states, on the relationship 
between the national government and the states, or on the distribution 
of power and responsibilities among the various levels of government.

F. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This action has tribal implications. However, it will neither 
impose substantial direct compliance costs on federally recognized 
tribal governments, nor preempt tribal law. The EPA conducted outreach 
on this rule via ongoing monthly meetings with tribal environmental 
professionals in the development of the proposed action. This action 
reflects tribal comments on, and priorities for, developing a 
streamlined approach for permitting true minor sources in the oil and 
natural gas sector in areas covered by the Federal Indian Country Minor 
NSR rule. Consistent with the EPA Policy on Consultation and 
Coordination with Indian Tribes (May 4, 2011),\83\ the EPA offered 
consultation on the proposed FIP to elected tribal officials, but no 
tribe requested a consultation.
---------------------------------------------------------------------------

    \83\ For more information, go to: https://www.epa.gov/tribal/epa-policy-consultation-and-coordination-indian-tribes.
---------------------------------------------------------------------------

    One tribal commenter did raise concerns about consultation in their 
written comments. The commenter recommended that, in order to develop 
an effective and equitable FIP, the EPA should first consult with the 
Ute Indian Tribe so that the Tribe can offer its expertise, experience, 
and input into developing the FIP. The commenter stated that the EPA 
should not attempt to revise the definition of Indian country. The Ute 
Indian Tribe requested that the EPA engage the Tribe in additional 
government-to-government consultation once the EPA has reviewed 
comments on the proposed rule and is prepared to discuss those comments 
and any changes to the proposed rule. After the comment period for this 
rulemaking closed in December, we followed up on the Ute Indian Tribe's 
request and it was determined that the requested consultation was no 
longer necessary.
    The EPA agrees with the commenter that consultation with affected 
tribes is important to development of a successful FIP. The EPA remains 
available to consult with tribes in regards to issues that affect them, 
or proactively in connection with tribal efforts to develop a TIP. The 
EPA has reached out to tribes during the development of this FIP. The 
EPA notes that the Mandan, Hidatsa, and Arikara Nation expressed an 
interest in working with us to develop this FIP, although the Tribe did 
not submit comments on the proposed FIP.
    We have made changes to the FIP proposal as a result of tribal 
comments. Most notably, at the request of a tribal commenter, we have 
clarified that we are not changing the definition of Indian country. 
Instead, we are clarifying the geographic applicability of the FIP with 
respect to areas of Indian country.
    As the FIP is implemented, we will continue to provide regular 
outreach to tribes to ensure we address issues concerning the FIP if 
and when they arise. The EPA is always available for consultation with 
any interested tribe.

G. Executive Order 13045: Protection of Children From Environmental 
Health Risks and Safety Risks

    This action is not subject to Executive Order 13045 because it is 
not economically significant as defined in EO 12866, and because the 
EPA does not believe the environmental health or safety risks addressed 
by this action present a disproportionate risk to children.

H. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution or Use

    This action is not subject to Executive Order 13211, because it is 
not a significant regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act (NTTAA)

    This action does not involve technical standards.

J. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    The EPA believes the human health or environmental risk addressed 
by this action will not have potential disproportionately high and 
adverse human health or environmental effects on minority, low-income 
or indigenous populations. This rule implements certain aspects of the 
Federal Indian Country Minor NSR rule.
    Our primary goal in developing this FIP is to ensure that air 
resources in areas covered by the Federal Indian Country Minor NSR rule 
will be protected in the manner intended by the CAA. This action will 
help ensure air quality protection in areas covered by the Federal 
Indian Country Minor NSR rule, by including in a FIP a comprehensive 
set of control requirements for new and modified true minor source in 
the oil and natural gas production and natural gas processing segments 
of the oil and natural gas sector. In addition, through this FIP, we

[[Page 35977]]

seek to establish a mechanism that provides an effective and efficient 
method for implementing a pre-construction permitting program for true 
minor sources in the oil and natural gas sector in areas covered by the 
Federal Indian Country Minor NSR rule. Under this rule we are 
finalizing an approach that enables a streamlined process, which helps 
promote economic development by minimizing delays in new construction; 
and provides a process comparable to those programs operated outside of 
Indian county, which helps tribes compete for new oil and natural gas 
production and natural gas processing in areas covered by the Federal 
Indian Country Minor NSR rule.

K. Congressional Review Act (CRA)

    This action is subject to the CRA, and the EPA will submit a rule 
report to each House of the Congress and to the Comptroller General of 
the United States. This action is not a ``major rule'' as defined by 5 
U.S.C. 804(2).

List of Subjects in 40 CFR Part 49

    Environmental protection, Administrative practices and procedures, 
Air pollution control, Indians, Indians-law, Indians-tribal government, 
Intergovernmental relations, Reporting and recordkeeping requirements.

    Dated: May 12, 2016.
Gina McCarthy,
Administrator.

    For the reasons set forth in the preamble, 40 CFR part 49 is 
amended as follows:

PART 49--INDIAN COUNTRY: AIR QUALITY PLANNING AND MANAGEMENT

0
1. The authority citation for part 49 continues to read as follows:

    Authority:  42 U.S.C. 7401, et seq.

Subpart C--General Federal Implementation Plan Provisions

0
2. Subpart C of part 49 is amended by adding an undesignated center 
heading and Sec. Sec.  49.101 through 49.105 to read as follows:

Federal Implementation Plan for Managing Air Emissions From True Minor 
Sources in Indian Country in the Oil and Natural Gas Production and 
Natural Gas Processing Segments of the Oil and Natural Gas Sector


Sec.  49.101  Introduction.

    (a) What is the purpose of Sec. Sec.  49.101 through 49.105? 
Sections 49.101 through 49.105 adopt legally and practicably 
enforceable requirements to control and reduce emissions of volatile 
organic compounds, nitrogen oxides, sulfur dioxide, particulate matter 
(PM, PM10, PM2.5), hydrogen sulfide, carbon 
monoxide and various sulfur compounds from new and modified true minor 
sources in the oil and natural gas production and natural gas 
processing segments of the oil and natural gas sector.
    (b) Am I subject to Sec. Sec.  49.101 through 49.105? You are 
subject to the requirements if you:
    (1) Own or operate a new true minor oil and natural gas source or 
an existing true minor oil and natural gas source undergoing 
modification as determined pursuant to Sec.  49.153(a) that meets the 
criteria specified in paragraphs (b)(1)(i) through (v) of this section. 
Then you shall comply with the requirements of Sec. Sec.  49.104 and 
49.105, unless you obtain a source-specific permit as specified in 
paragraph (b)(2) or (3) of this section.
    (i) The source is an oil and natural gas source as defined in Sec.  
49.102;
    (ii) The oil and natural gas source as defined in Sec.  49.102 is 
located in Indian country as defined in Sec.  49.152(d), within the 
geographic scope of the Federal Minor New Source Review Program in 
Indian Country, as specified in Sec.  49.102;
    (iii) The oil and natural gas source as defined in Sec.  49.102 is 
a new true minor source or a minor modification of an existing true 
minor source, as determined under Sec.  49.153;
    (iv) The oil and natural gas source as defined in Sec.  49.102 
begins construction or modification on or after October 3, 2016; and
    (v) The oil and natural gas source as defined in Sec.  49.102 is 
not located in a designated nonattainment area.
    (2) Owners/operators of sources that meet the criteria specified in 
paragraph (b)(1) of this section that choose to obtain a source-
specific permit as specified in Sec.  49.155 before beginning 
construction are not required to comply with the requirements of 
Sec. Sec.  49.101 through 49.105.
    (3) Owners/operators of sources that meet the criteria specified in 
paragraph (b)(1) of this section that the Reviewing Authority requires 
to obtain a source-specific permit to ensure protection of the National 
Ambient Air Quality Standards as specified in Sec.  49.155 before 
beginning construction are not required to comply with Sec. Sec.  
49.101 through 49.105.
    (c) When must I comply with Sec. Sec.  49.101 through 49.105? You 
must comply with Sec. Sec.  49.101 through 49.101 on or after October 
3, 2016.
    (d) This Federal Implementation Plan (FIP) does not apply to minor 
modifications at major sources.


Sec.  49.102  Definitions.

    As used in Sec. Sec.  49.101 through 49.105, all terms not defined 
herein shall have the meaning given them in the Clean Air Act, in 
subparts A and OOOOa of 40 CFR part 60, in the Prevention of 
Significant Deterioration regulations at 40 CFR 52.21, or in the 
Federal Minor New Source Review Program in Indian Country at Sec.  
49.152. The following terms shall have the specific meanings given 
them:
    Oil and natural gas source means a stationary source engaged in the 
extraction and production of oil and natural gas and/or the processing 
of natural gas, including the wells and all related processes used in 
the extraction, production, recovery, lifting, stabilization, and 
separation or treatment of oil, water, and/or natural gas (including 
condensate). Oil and natural gas production and processing components 
may include, but are not limited to: Wells and related casing head; 
tubing head and ``Christmas tree'' piping; pumps; compressors; heater 
treaters; separators; storage vessels; pneumatic devices; stationary 
engines; natural gas sweetening; truck loading; dewpoint suppression 
skids; natural gas dehydrators; completion and workover processes; 
gathering pipelines and related components that collect and transport 
the oil, natural gas and other materials and wastes from the wells or 
well pads; and natural gas processing plants.
    Oil and natural gas well means a single well that extracts 
subsurface reservoir fluids containing a mixture of oil and/or natural 
gas, and water.
    Owner/operator means any person who owns, leases, operates, 
controls, or supervises an oil and natural gas source.
    Regional Administrator means the Regional Administrator of an EPA 
Region or an authorized representative of the Regional Administrator.


Sec.  49.103  Delegation of authority of administration to Indian 
tribes.

    (a) What is the purpose of this section? The purpose of this 
section is to establish the process by which a Regional Administrator 
may delegate to a federally-recognized tribe the authority to assist 
the EPA with administration of this FIP (Sec. Sec.  49.101 through 
49.105). This section provides for administrative delegation and does 
not affect the eligibility criteria under Sec.  49.6 for treatment in 
the same manner as a state or a tribe's ability to obtain

[[Page 35978]]

approval of a tribal implementation plan under Sec.  49.7.
    (b) How does a tribe request delegation? In order to be delegated 
authority to assist us with administration of this FIP, the authorized 
representative of a federally-recognized tribe must submit a request to 
a Regional Administrator that:
    (1) Identifies the specific provisions for which delegation is 
requested;
    (2) Identifies the Indian Reservation or other affected areas of 
Indian country for which delegation is requested;
    (3) Includes a statement by the applicant's legal counsel (or 
equivalent official) that includes the following:
    (i) A statement that the applicant is a tribe recognized by the 
Secretary of the Interior;
    (ii) A descriptive statement that is consistent with the type of 
information described in Sec.  49.7(a)(2) demonstrating that the 
applicant is currently carrying out substantial governmental duties and 
powers over a defined area;
    (iii) A description of the laws of the tribe that provide adequate 
authority to administer the Federal rules and provisions for which 
delegation is requested; and
    (iv) A demonstration that the tribal agency that will be 
responsible for administration has the technical capability and 
adequate resources to administer the FIP provisions for which 
delegation is requested.
    (c) How is the delegation of administrative authority accomplished? 
(1) A Delegation of Authority Agreement will set forth the terms and 
conditions of the administrative delegation, will specify the rule and 
provisions that the tribe shall be authorized to implement on behalf of 
the EPA, and shall be entered into by the Regional Administrator and 
the tribe. The Agreement will become effective upon the date that both 
the Regional Administrator and the authorized representative of the 
tribe have signed the Agreement. Once the delegation becomes effective, 
the tribe will be responsible, to the extent specified in the 
Agreement, for assisting us with administration of this FIP and shall 
act as the Regional Administrator as that term is used in these 
regulations. Any Delegation of Authority Agreement will clarify the 
circumstances in which the term ``Regional Administrator'' found 
throughout this FIP is to refer only to the EPA Regional Administrator 
and when it is intended instead to refer to the EPA Regional 
Administrator or a federally-recognized tribe.
    (2) A Delegation of Authority Agreement may be modified, amended, 
or revoked, in part or in whole, by the Regional Administrator after 
consultation with a tribe.
    (d) How will any Delegation of Authority Agreement be publicized? 
The Regional Administrator shall publish a notice in the Federal 
Register informing the public of any Delegation of Authority Agreement 
with a tribe to assist us with administration of all or a portion of 
this FIP and will identify such delegation in the Code of Federal 
Regulations. The Regional Administrator shall also publish an 
announcement of the Delegation of Authority Agreement in local 
newspapers.


Sec.  49.104  Requirements regarding threatened or endangered species 
and historic properties.

    (a) What are sources required to do to address threatened or 
endangered species and historic properties? An owner/operator subject 
to the requirements contained in Sec. Sec.  49.101 through 49.105 to 
satisfy its obligation under Sec.  49.151(c)(1)(iii)(B) to obtain a 
minor NSR permit shall meet either paragraph (c)(1) or (2) of this 
section, as appropriate.
    (1) Prior completion of assessment by another federal agency. The 
owner/operator shall submit to the EPA Regional Office (and to the 
relevant tribe for the area where the source is located/locating) valid 
documentation demonstrating that prior Endangered Species Act (ESA) 
and/or National Historic Preservation Act (NHPA) compliance has been 
completed by another federal agency in connection with the specific oil 
and natural gas activity operated under this FIP (we would consider a 
document no longer valid if the issuing agency has reopened 
consultation for the prior approval). The appropriate documents shall 
clearly show that the other federal agency had met its obligations 
under both the ESA and NHPA. A simple reference to a Record of Decision 
or other final decision document will not be acceptable. For listed 
species, acceptable documentation can include a copy of a letter or 
biological opinion from the U.S. Fish and Wildlife Service addressing 
the effects of the project on listed species and critical habitat and 
demonstrating compliance by the federal action agency with ESA 
requirements. Where the federal action agency prepares a biological 
assessment of the action as part of its ESA compliance, that document 
shall also be provided to the EPA Regional Office. For historic 
properties, acceptable documentation can include: a letter from the 
appropriate historic preservation office, or a memorandum of agreement 
with that office, addressing the effects of the project on historic 
properties and demonstrating compliance by the federal action agency 
with NHPA requirements. All documentation shall be attached to the Part 
1 Registration Form submitted in accordance with Sec.  
49.160(c)(1)(iv).
    (2) Screening procedures completed by the owner/operator. The 
owner/operator shall submit to the EPA Regional Office (and to the 
relevant tribe for the area where the source is located/locating) 
documentation demonstrating that it has completed the screening 
procedures specified for consideration of threatened and endangered 
species and/or historic properties and receive written confirmation 
from the EPA stating that it has satisfactorily completed these 
procedures. This process of source documentation submittal and the 
EPA's confirmation that it has satisfactorily completed the procedures 
must occur prior to the source's submittal of its Part 1 Registration 
Form pursuant to Sec.  49.160(c)(1)(iv). (The procedures are contained 
in the following document: ``Procedures to Address Threatened and 
Endangered Species and Historic Properties for the Federal 
Implementation Plan for Managing Air Emissions from True Minor Sources 
in Indian Country in the Oil and Natural Gas Production and Natural Gas 
Processing Segments of the Oil and Natural Gas Sector,'' https://www.epa.gov/tribal-air/tribal-minor-new-source-review). Review of your 
submittal will be conducted by the Reviewing Authority in accordance 
with the procedure in paragraphs (a)(2)(i) and (ii) of this section:
    (i) Within 30 days of receipt of your documentation, by letter to 
you, the Reviewing Authority must provide one of the following 
determinations:
    (A) The documentation satisfactorily demonstrates completion of the 
screening procedures; or
    (B) The documentation is not adequate, and additional information 
is needed. If the initial submittal is deficient, the Reviewing 
Authority will note any such deficiencies and may offer further 
direction on completing the screening procedures. Once you have 
addressed the noted deficiencies you must resubmit your revised 
screening procedure documentation for review. An additional 15-day 
review notification period will be used for the Reviewing Authority to 
determine whether the listed species and/or historic property screening 
procedures have been satisfied. If the Reviewing Authority makes such a 
determination,

[[Page 35979]]

they will send you a letter stating that conclusion.
    (ii) You must obtain a letter from the Reviewing Authority 
indicating that the source has adequately completed the screening 
procedures before you can submit the Part 1 Registration Form under 
Sec.  49.160(c)(1)(iv) and begin construction under this FIP.
    (b) [Reserved]


Sec.  49.105  Requirements.

    (a) For true minor sources (and minor modifications at true minor 
sources) that are subject to 40 CFR part 63, subpart DDDDD (National 
Emission Standards for Hazardous Air Pollutants for Major Sources: 
Industrial, Commercial, and Institutional Boilers and Process Heaters), 
for purposes of this FIP, sources must comply with all of the 
applicable provisions of the standard as written at the time the owner/
operator begins construction on the new true minor source or on the 
minor modification at an existing true minor source.
    (b) For true minor sources (and minor modifications at true minor 
sources) that are subject to 40 CFR part 63, subpart ZZZZ (NESHAP for 
Stationary Reciprocating Internal Combustion Engines), for purposes of 
this FIP, sources must comply with all of the applicable provisions of 
the standard as written at the time the owner/operator begins 
construction on the new true minor source or on the minor modification 
at an existing true minor source.
    (c) For true minor sources (and minor modifications at true minor 
sources) that are subject to 40 CFR part 60, subpart IIII (Standards of 
Performance for Stationary Compression Ignition Internal Combustion 
Engines), for purposes of this FIP, sources must comply with all of the 
applicable provisions of the standard as written at the time the owner/
operator begins construction on the new true minor source or on the 
minor modification at an existing true minor source, except for 
paragraphs (c)(1) through (7) of this section:
    (1) Section 60.4200(a)(1)--Am I subject to this subpart? (applies 
to manufacturers);
    (2) Section 60.4200(b)--Not applicable to a stationary spark 
ignition internal combustion engine being tested at an engine test 
cell/stand;
    (3) Section 60.4201--What emission standards must I meet for non-
emergency engines if I am a stationary compression ignition internal 
combustion engine manufacturer?;
    (4) Section 60.4202--What emission standards must I meet for 
emergency engines if I am a stationary compression ignition internal 
combustion engine manufacturer?;
    (5) Section 60.4203--How long must my engines meet the emission 
standards if I am a manufacturer of stationary compression ignition 
internal combustion engines?;
    (6) Section 60.4210--What are my compliance requirements if I am a 
stationary compression ignition internal combustion engine 
manufacturer?; and
    (7) Section 60.4215--What requirements must I meet for engines used 
in Guam, American Samoa, or the Commonwealth of the Northern Mariana 
Islands?
    (d) For true minor sources (and minor modifications at true minor 
sources) that are subject to 40 CFR part 60, subpart JJJJ (Standards of 
Performance for Stationary Spark Ignition Internal Combustion Engines), 
for purposes of this FIP, sources must comply with all of the 
applicable provisions of the standard as written at the time the owner/
operator begins construction on the new true minor source or on the 
minor modification at an existing true minor source, except for 
paragraphs (d)(1) through (5) of this section:
    (1) Section 60.4230(b)--Not applicable to stationary spark ignition 
internal combustion engines being tested at an engine test cell/stand;
    (2) Section 60.4230(c)--Exemption for obtaining a Title V permit if 
owner or operator of an area source subject to this part;
    (3) Sections 60.4231 and 60.4232--Emission standards for 
manufacturers;
    (4) Sections 60.4238 through 60.4242--Compliance Requirements for 
Manufacturers; and
    (5) Section 60.4247--Mobile source provisions that apply to 
manufacturers of stationary spark ignition internal combustion engines 
or equipment containing such engines.
    (e) For true minor sources (and minor modifications at true minor 
sources) that are subject to 40 CFR part 60, subpart Kb (Standards of 
Performance for Volatile Organic Liquid Storage Vessels), for purposes 
of this FIP, sources must comply with all of the applicable provisions 
of the standard as written at the time the owner/operator begins 
construction on the new true minor source or on the minor modification 
at an existing true minor source, except for paragraphs (e)(1) and (2) 
of this section:
    (1) Section 60.112b(c)--Source-specific standard for Merck & Co., 
Inc.'s Stonewall Plant in Elkton, Virginia; and
    (2) Section 60.117b(a) and (b)--Delegation of authority.
    (f) For true minor sources (and minor modifications at true minor 
sources) that are subject to subpart OOOOa (Standards of Performance 
for Crude Oil and Natural Gas Facilities for which Construction, 
Modification, or Reconstruction Commenced after September 18, 2015), 
for purposes of this FIP, sources must comply with all of the 
applicable provisions of the standard as written at the time the owner/
operator begins construction on the new true minor source or on the 
minor modification at an existing true minor source, except for 
paragraphs (f)(1) through (5) of this section:
    (1) Section 60.5365a(h)(4)--Existing sources constructed after 
August 23, 2011;
    (2) Section 60.5370a(c)--Permit exemption;
    (3) Section 60.5413a(a)(5)--Exemptions from performance testing--
hazardous waste incinerator;
    (4) Section 60.5420a(a)(2)(i)--Advance notification requirements 
for well completions; and
    (5) Section 60.5420a(a)(2)(ii)--Advance notification requirements 
of well completions when subject to state regulation that requires 
advance notification.
    (g) For true minor sources (and minor modifications at true minor 
sources) that are subject to 40 CFR part 63, subpart HH (National 
Emission Standards for Hazardous Air Pollutants from Oil and Natural 
Gas Production Facilities), for purposes of this FIP, sources must 
comply with all of the applicable provisions of the standard as written 
at the time the owner/operator begins construction on the new true 
minor source or on the minor modification at an existing true minor 
source, except for paragraphs (g)(1) through (6) of this section:
    (1) Section 63.760(a)(2)--Facilities that process, upgrade or store 
hydrocarbon liquids;
    (2) Section 63.760(b)(1)(ii)--Each storage vessel with the 
potential for flash emissions;
    (3) Section 63.760(g)--Recordkeeping for major sources that overlap 
with other regulations for equipment leaks;
    (4) Section 63.764(c)(2)--Requirements for compliance with 
standards for storage vessels;
    (5) Seciton 63.766--Storage vessel standards; and
    (6) Section 63.769--Equipment leak standards.
    (h) For true minor sources (and minor modifications at true minor 
sources) that are subject to 40 CFR part 60, subpart KKKK (Standards of 
Performance for Stationary Combustion Turbines), for purposes of this 
FIP, the

[[Page 35980]]

owner/operator must comply with all of the applicable provisions of the 
standard as written at the time the owner/operator begins construction 
on the new true minor source or on the minor modification at an 
existing true minor source.

0
3. Section 49.151 is amended by revising paragraphs (b)(1), (c)(1) 
introductory text, (c)(1)(iii)(A) and (B), and (d)(1), (2), and (4) to 
read as follows:


Sec.  49.151  Program overview.

* * * * *
    (b) * * *
    (1) It satisfies the requirements of section 110(a)(2)(C) of the 
Act by establishing a pre-construction permitting program for all new 
and modified minor sources (minor sources) and minor modifications at 
major sources located in Indian country and by establishing a Federal 
Implementation Plan (Sec. Sec.  49.101 through 49.105) for true minor 
sources in the oil and natural gas production and natural gas 
processing segments that are located in Indian country.
* * * * *
    (c) When and where does this program apply? (1) The provisions of 
this program apply in all Indian reservation lands where no EPA-
approved program is in place and all other areas of Indian country 
where no EPA-approved program is in place and over which an Indian 
tribe, or the EPA, has demonstrated that a tribe has jurisdiction, 
according to the implementation schedule in paragraphs (c)(1)(i) 
through (iii) of this section:
* * * * *
    (iii) * * *
    (A) If you own or operate an existing true minor source in Indian 
country (as defined in Sec.  49.152(d)), you must register your source 
with the Reviewing Authority in your area by March 1, 2013. If your 
true minor source is not engaged in an oil and natural gas activity and 
you commence construction after August 30, 2011, and before September 
2, 2014, you must also register your source with the Reviewing 
Authority in your area within 90 days after the source begins 
operation. If your true minor source is engaged in an oil and natural 
gas activity and you commence construction after August 30, 2011, and 
before October 3, 2016, you must register your source with the 
Reviewing Authority in your area within 90 days after the source begins 
operation. You are exempt from these registration requirements if your 
true minor source is subject to Sec.  49.138.
    (B) If your true minor source is not engaged in an oil and natural 
gas activity and you wish to begin construction of a new true minor 
source or a minor modification at an existing true minor source on or 
after September 2, 2014, you must first obtain a permit pursuant to 
Sec. Sec.  49.154 and 49.155 (or a general permit/permit by rule 
pursuant to Sec.  49.156, if applicable). If your true minor source is 
an oil and natural gas source, as defined in Sec.  49.102, and you wish 
to begin construction of a new true minor source or a minor 
modification at an existing true minor source on or after October 3, 
2016, you must either comply with the Federal Implementation Plan for 
sources in the oil and natural gas production and natural gas 
processing segments of the oil and natural gas sector that are located 
in Indian country (Sec. Sec.  49.101 through 49.105) from the day you 
begin construction or opt out of those requirements pursuant to Sec.  
49.101(b)(2) and instead obtain a minor source permit pursuant to 
Sec. Sec.  49.154 and 49.155 before beginning construction. 
Alternatively, you may be required by the EPA, pursuant to Sec.  
49.101(b)(3), to obtain a minor source permit pursuant to Sec. Sec.  
49.154 and 49.155 before beginning construction. All proposed new 
sources or modifications of existing sources are also subject to the 
registration requirements of Sec.  49.160, except for sources that are 
subject to Sec.  49.138.
* * * * *
    (d) * * *
    (1) If you begin construction of a new source or modification that 
is subject to this program after the applicable date specified in 
paragraph (c) of this section without applying for and receiving a 
permit pursuant to this program or complying with the Federal 
Implementation Plan at Sec. Sec.  49.101 through 49.105 for the oil and 
natural gas production and natural gas processing segments of the oil 
and natural gas sector, you will be subject to appropriate enforcement 
action.
    (2) If you do not construct or operate your source or modification 
in accordance with the terms of your minor NSR permit or the Federal 
Implementation Plan for the oil and natural gas production and natural 
gas processing segments of the oil and natural gas sector at Sec. Sec.  
49.101 through 49.105, you will be subject to appropriate enforcement 
action.
* * * * *
    (4) Issuance of a permit or compliance with the Federal 
Implementation Plan for the oil and natural gas production and natural 
gas processing segments of the oil and natural gas sector at Sec. Sec.  
49.101 through 49.105 does not relieve you of the responsibility to 
comply fully with applicable provisions of any EPA-approved 
implementation plan or Federal Implementation Plan or any other 
requirements under applicable law.
* * * * *

0
4. Section 49.152 is amended in paragraph (d) by revising the 
introductory text and adding paragraph (4) to the definition of 
``Indian country'' and adding in alphabetical order the definition 
``Startup of production'' to read as follows:


Sec.  49.152  Definitions.

* * * * *
    (d) * * *
    Indian country, as defined in 18 U.S.C. 1151, means the following 
as applied to this program:
* * * * *
    (4) The geographic scope of applicability of this rule is as 
specified in Sec.  49.151(c)(1).
* * * * *
    Startup of production is as defined at Sec.  60.5430a.
* * * * *

0
5. Section 49.153 is amended by revising paragraphs (a)(1)(i)(B) and 
(a)(1)(ii)(B) to read as follows:


Sec.  49.153  Applicability.

    (a) * * *
    (1) * * *
    (i) * * *
    (B) Step 2. Determine whether your proposed source's potential to 
emit for the pollutant that you are evaluating, (including fugitive 
emissions, to the extent they are quantifiable, only if the source 
belongs to one of the source categories listed pursuant to section 
302(j) of the Act), is equal to or greater than the corresponding minor 
NSR threshold in Table 1 of this section. If it is, then you are 
subject to the pre-construction requirements of this program for that 
pollutant, except that sources in the oil and natural gas production 
and natural gas processing segments of the oil and natural gas sector 
shall instead comply with the requirements of the Federal 
Implementation Plan at Sec. Sec.  49.101 through 49.105, unless you 
opt-out of the Federal Implementation Plan pursuant to Sec.  
49.101(b)(2) in which case you are subject to the pre-construction 
requirements of this program for that pollutant or are required by the 
EPA to obtain a minor source permit pursuant to Sec.  49.101(b)(3). If 
it is not, then proceed to Step 3 (paragraph (a)(1)(ii)(C) of this 
section).
    (ii) * * *

[[Page 35981]]

    (B) Step 2. Determine whether the increase in allowable emissions 
from the proposed modification (calculated using the procedures of 
paragraph (b) of this section) would be equal to or greater than the 
minor NSR threshold in Table 1 of this section for the pollutant that 
you are evaluating. If it is, then you are subject to the pre-
construction requirements of this program for that pollutant, except 
oil and natural gas production and natural gas processing sources shall 
instead comply with the requirements of the Federal Implementation Plan 
at Sec. Sec.  49.101 through 49.105, unless you opt-out of the Federal 
Implementation Plan pursuant to Sec.  49.101(b)(2) in which case you 
are subject to the pre-construction requirements of this program for 
that pollutant or are required by the EPA to obtain a minor source 
permit pursuant to Sec.  49.101(b)(3). If it is not, then proceed to 
Step 3 (paragraph (a)(1)(ii)(C) of this section).
* * * * *

0
6. Section 49.160 is amended by revising paragraphs (c)(1)(ii) and 
(iii), adding paragraph (c)(1)(iv), and revising paragraph (c)(4) to 
read as follows:


Sec.  49.160  Registration program for minor sources in Indian country.

* * * * *
    (c) * * *
    (1) * * *
    (ii) If your true minor source is not engaged in an oil and natural 
gas activity, and you commence construction after August 30, 2011, and 
before September 2, 2014, then you must register your source with the 
Reviewing Authority within 90 days after the source begins operation. 
If your new true minor source or minor modification of an existing true 
minor source is engaged in an oil and natural gas activity, and you 
commence construction after August 30, 2011, and before October 3, 
2016, then you must register your source with the Reviewing Authority 
within 90 days after the source begins operation.
    (iii) If your true minor source is not engaged in an oil and 
natural gas activity, and you commence construction or modification of 
your source on or after September 2, 2014, and your source is subject 
to this rule, then you must report your source's actual emissions (if 
available) as part of your permit application and your permit 
application information will be used to fulfill the registration 
requirements described in paragraph (c)(2) of this section. If your 
true minor source is engaged in an oil and natural gas activity, and 
you commence construction or modification of your source on or after 
October 3, 2016, then you must report your source's actual emissions 
(if available) as part of your permit application (source-specific 
permits), unless you are subject to the Federal Implementation Plan 
under Sec. Sec.  49.101 through 49.105 (where the requirements under 
paragraph (c)(1)(iv) of this section shall be met). Your permit 
application for oil and natural gas production and natural gas 
processing sources seeking a source-specific permit will be used to 
fulfill the registration requirements described in paragraph (c)(2) of 
this section.
    (iv) Minor sources complying with Sec. Sec.  49.101 through 49.105 
for the oil and natural gas production and natural gas processing 
segments of the oil and natural gas sector, as defined in Sec.  49.102, 
must submit the Part 1 Registration Form 30 days prior to beginning 
construction that contains the information in paragraph (c)(2) of this 
section. The Part 2 Registration Form must be submitted within 60 days 
after the startup of production as defined in Sec.  49.152(d), which 
include emissions information. The source must determine the potential 
for emissions within 30 days after startup of production. The 
combination of the Part 1 and Part 2 Registration Forms submittals 
satisfies the requirements in paragraph (c)(2) of this section. The 
forms are submitted to the EPA instead of the application form required 
in paragraph (c)(1)(iii) of this section. The forms are available at: 
https://www.epa.gov/tribal-air/tribal-minor-new-source-review or from 
the EPA Regional Offices.
* * * * *
    (4) Duty to obtain a permit or to comply with the Federal 
Implementation Plan for sources in the oil and natural gas production 
and natural gas processing segments of the oil and natural gas sector. 
Submitting a registration form does not relieve you of the requirement 
to obtain any required permit, including a pre-construction permit, or 
to comply with the Federal Implementation Plan for the oil and natural 
gas production and natural gas processing segments of the oil and 
natural gas sector if your source or any physical or operational change 
at your source would be subject to any minor or major NSR rule.
* * * * *

0
7. Section 49.166 is amended by revising paragraph (c)(1) to read as 
follows:


Sec.  49.166  Program overview.

* * * * *
    (c) When and where does this program apply? (1) The provisions of 
this program apply to new major sources and major modifications at 
existing major sources located in nonattainment areas in all Indian 
reservation lands where no EPA-approved program is in place and all 
other areas of Indian country where no EPA-approved program is in place 
and over which an Indian tribe, or the EPA, has demonstrated that a 
tribe has jurisdiction, and where there is no EPA-approved 
nonattainment major NSR program beginning on August 30, 2011. The 
provisions of this program apply only to new sources and modifications 
that are major for the regulated NSR pollutant(s) for which the area is 
designated nonattainment.
* * * * *

0
8. Section 49.167 is amended by revising the introductory text and 
adding paragraph (4) to the definition of ``Indian country'' to read as 
follows:


Sec.  49.167  Definitions.

* * * * *
    Indian country, as defined in 18 U.S.C. 1151, means the following 
as applied to this program:
* * * * *
    (4) The geographic scope of applicability of this rule is as 
specified in Sec.  49.166(c)(1).
* * * * *
[FR Doc. 2016-11969 Filed 6-2-16; 8:45 am]
 BILLING CODE 6560-50-P


