NPDES Offshore General Order - February 16, 2002

ENVIRONMENTAL PROTECTION AGENCY

General Administrative Compliance Order issued under Section 309 of the CWA to Permittees covered by the NPDES General Permit for New and Existing Sources and New Dischargers in the Offshore Subcategory of the Oil and Gas Extraction Category for the Western Portion of the Outer Continental Shelf of the Gulf of Mexico (GMG290000)

_____________________________________________________________________
AGENCY: Environmental Protection Agency

ACTION: Notice of Availability of General Administrative Compliance Order

SUMMARY: Region 6 of the Environmental Protection Agency (EPA) today issues a general administrative compliance order applicable to those dischargers affected by EPA's recent modification to the National Pollutant Discharge Elimination System (NPDES) general permit for the Western Portion of the Outer Continental Shelf of the Gulf of Mexico (GMG290000) for discharges from new sources, existing sources and new dischargers in the Offshore Subcategory of the Oil and Gas Extraction Category (40 CFR Part 435, Subpart A), which was published on December 18, 2001 (66 FR 65209) ("the offshore general permit" or "the permit"). The general administrative compliance order requires those dischargers who cannot comply with the modified permit's limits for discharges of drill cuttings generated using synthetic and other non-aqueous based drilling fluids to achieve compliance no later than August 16, 2002, with all limitations except the four-day sediment toxicity limit. Permittees must achieve compliance with the limitation for four-day sediment toxicity no later than February 1, 2003.

FOR FURTHER INFORMATION CONTACT: Mr. Taylor Sharpe, EPA Region 6, 1445 Ross Ave., Dallas, Texas 75202, Telephone: (214) 665-7112, or via EMAIL at the following address: sharpe.taylor@epa.gov.

SUPPLEMENTARY INFORMATION: As published on December 18, 2001 [66 FR 65209], EPA modified the offshore general permit, which was originally published November 2, 1998 (63 FR 58722) and modified April 19, 1999 [64 FR 19156], to address certain discharges and uses of non-aqueous based (synthetic) drilling fluids. The December 18, 2001, modification will become effective on February 16, 2002, and can be found on the Internet at http://www.epa.gov/region6/6wq/npdes/genpermt/offshore/fr_not.pdf.

EPA received several comments on the draft permit, published on June 4, 2001 (66 FR 29948), requesting additional time for compliance with the permit modification. EPA is aware that this permit modification may cause many permittees to add and/or modify existing pollution control equipment in order to obtain compliance with the modified permit. Upon review of the probable process modifications necessary for compliance, EPA has agreed that a reasonable schedule for compliance may be issued for facilities that become aware of a violation, report it to EPA, and request an administrative compliance order within thirty (30) days of becoming aware of the violation. Compliance Order Notices for all violations except violations of the four-day sediment toxicity limitation, must be postmarked before August 16, 2002. Compliance Order Notices for violations of the four-day sediment toxicity limitation must be postmarked before February 1, 2003. The compliance order will provide until August 16, 2002, for permittees to make any necessary pollution control changes for all discharges to come into compliance with the new permit modifications for all new limitations except the four-day sediment toxicity limit. Permittees will be given until February 1, 2003, to make any necessary pollution control changes for all discharges to come into compliance with the new limitation for four-day sediment toxicity.

It is the policy of EPA to achieve full compliance with the NPDES permit program as rapidly as possible. If you have any questions regarding the applicability of this action to a particular entity, please contact the person listed in the preceding "FOR FURTHER INFORMATION CONTACT" section. An "Information Sheet" relating to the Small Business Regulatory Enforcement Fairness Act (SBREFA) may pertain to you and you may find this "Information Sheet" on the Internet at <http://es.epa.gov/oeca/ccsmd/sbrefa.pdf>. You may be subject to providing a "Notice of Registrants Duty to Disclose" relating to the disclosure of environmental legal proceedings to the Securities and Exchange Commission (SEC). This SEC notice may be found on the Internet at <http://www.epa.gov/earth1r6/6en/w/sec.pdf>. You can find out more information regarding your NPDES Offshore program on the Internet at: http://www.epa.gov/region6/offshore.

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United States Environmental Protection Agency, Region 6

In Re: NPDES PERMIT NO. GMG290000

General Administrative Compliance Order

The following Findings are made, and Order issued, under the authority vested in the Administrator of the United States Environmental Protection Agency (EPA), by Sections 308(a) and 309(a) of the Clean Water Act ("the Act"), 33 U.S.C. §§ 1318(a) and 1319(a). The Administrator of EPA has delegated the authority to issue this Order to the Regional Administrator of EPA Region 6, who has further delegated this authority to the Director of the Compliance Assurance and Enforcement Division. Issuance of this order is not "final agency action" and is subject to judicial review only in connection with an action to enforce its terms.

Findings

1. Section 402(a) of the Act, 33 U.S.C. § 1342(a), provides that the Administrator of EPA may issue permits under the National Pollutant Discharge Elimination System (NPDES) program for the discharge of pollutants from point sources to waters of the United States. Any such discharge is subject to the specific terms and conditions prescribed in the applicable permit.

2. Pursuant to Section 402(a) of the Act, EPA issued the "Final NPDES General Permit for New and Existing Sources and New Discharges in the Offshore Subcategory of the Oil and Gas Extraction Category for the Western Portion of the Outer Continental Shelf of the Gulf of Mexico," 63 FR 58722 (November 2, 1998) (GMG290000), which was modified April 19, 1999 [64 FR 19156], and December 18, 2001 [66 FR 65209]. The general permit authorizes discharges from new sources, existing sources, and new discharges in the Offshore Subcategory of the Oil and Gas Extraction Point Source Category (40 CFR 435, Subpart A) to operators of lease blocks in the Oil and Gas Extraction Point Source Category which are located in Federal waters of the Western Portion of the Gulf of Mexico (defined as seaward of the outer boundary of the territorial seas off Louisiana and Texas) to the Western Portion of the Federal Waters of the Gulf of Mexico ("the industry"), but only in accordance with the conditions of the permit. The permit does not authorize discharges from facilities located in or discharging to the territorial seas of Louisiana or Texas or from facilities defined as "coastal," "onshore," or "stripper" (see 40 CFR part 435, Subparts C, E, and E). The permit does, however, authorize the discharge of produced water to the Western portion of the Federal Waters of the Gulf of Mexico from wells located in lease blocks in the territorial seas of Louisiana and Texas.

3. As published on December 18, 2001 [66 FR 65209], EPA Region 6 again modified the permit to allow for discharges of drill cuttings generated using synthetic and other non-aqueous based drilling fluids and hydrostatic test water from pressure testing of existing pipelines. These permit modifications, effective February 16, 2002, impose new discharge limitations and standards for non-aqueous drilling fluids as specified below. Any further reference to "the permit" in this Order shall refer to the modified permit published on December 18, 2001 [66 FR 65209].

Limitations and Monitoring Requirements Which Apply to Drill Cuttings Generated Using Non-Aqueous Based Drilling Fluids.

 

A. Stock Limitations:

 

The permittee shall analyze a representative sample of the stock base fluids at the frequencies listed below. The test results shall be reported on the Discharge Monitoring Report.

Alternatively, the permittee may provide certification, as documented by the supplier(s), that the stock base fluid being used on the well will meet the limits listed below.

Polynuclear Aromatic Hydrocarbons (PAH). The mass ratio in grams of PAH (as phenanthrene) divided by the mass in grams of base fluids shall not exceed 0.00001. Monitoring shall be performed at least once per year on each base fluid blend. See Part I, Section D.10. of the permit.

Sediment Toxicity. The ratio of the 10-day LC50 of C16 - C18 internal olefin or C12-C14 or C8 ester reference fluid divided by the 10-day LC50 sediment toxicity test with Leptocheirus plumulosus of the base fluid shall not exceed 1.0. Monitoring shall be performed at least once per year on each base fluid blend. See Part I, Section D.8 of the permit.

Biodegradation Rate. The ratio of the cumulative gas production (ml) of C16 - C18 internal olefin or C12-C14 or C8 ester reference fluid divided by the cumulative gas production (ml) of stock base fluid, both at 275 days, shall not exceed 1.0. Monitoring shall be performed at least once per year on each base fluid blend. See Part I, Section D.9. of the permit.

Exception: Until February 1, 2003 a blend of different non-aqueous base fluids may be considered compliant with the biodegradation rate limit if the weighted average of the base fluids' biodegradation rate is greater than that of the C16-C18 internal olefin standard tested concurrently.

B) Discharge Limitations:

 

Sediment Toxicity. The ratio of the 4-day LC50 of C16 - C18 internal olefin reference drilling fluid divided by the 4-day LC50 of the drilling fluids removed from cuttings at the solids control equipment shall not exceed 1.0. Monitoring shall be performed at least once per month on drilling fluids which meet the stock limitations for a C16-C18 internal olefin. The final monthly sample shall be collected at the end of drilling with non-aqueous based drilling fluids. For drilling fluids which meet stock limitations for C12-C14 ester or C8 ester, monitoring shall be performed at least once per well at the end of drilling with non-aqueous based drilling fluids. See Appendix A of the permit.

The reference drilling fluid shall be formulated from C16 - C18 internal olefin and meet the criteria listed in Table 1 of 40 CFR Part 435, Subpart A, Appendix 8. A uniform emulsifier package shall be used for all formulations of reference drilling fluids.

Formation Oil. No discharge. Monitoring shall be performed on the drilling fluid as follows:

 

(1) Once prior to drilling using the gas chromatography/mass spectrometry test method specified in Part I, Section D.11. of the permit. The test results shall be reported on the Discharge Monitoring Report (DMR).

Alternatively, the permittee may provide certification, as documented by the supplier(s), that the drilling fluid being used on the well will meet the no discharge limit for formation oil.

(2) Once per week during drilling using the Reverse Phase Extraction test method specified in Part I, Section D.12. of the permit.

Base Fluids Retained on Cuttings.

Monitoring shall be performed at least once per day when generating new cuttings, except when meeting the conditions of the Best Management Practices described below. Operators conducting fast drilling (i.e., greater than 500 linear feet advancement of the drill bit per day using non-aqueous fluids) shall collect and analyze one set of drill cuttings samples per 500 linear feet drilled, with a maximum of three sets per day. Operators shall collect a single discrete drill cuttings sample for each point of discharge to the ocean. The weighted average of the results of all discharge points for each sampling interval will be used to determine compliance. See Part I, Section D.13. of the permit.

 

Drilling Fluids which meet stock limitations for C16-C18 internal olefin: the end-of-well maximum weighted mass ratio averaged over all well sections drilled using non-aqueous fluids shall not exceed 6.9 grams non-aqueous base fluids per 100 grams of wet drill cuttings.

Drilling fluids which meet stock limitations for C12-C14 ester or C8 ester: the end-of-well maximum weighted mass ratio averaged over all well sections drilled using non-aqueous fluids shall not exceed 9.4 grams non-aqueous bas fluids per 100 grams of wet drill cuttings.

See also Part I, Section B.2.c. of the permit.

4. To maintain oil and gas production and comply with the permit's new limits established in the permit modifications, Permittees may have to modify process controls to decrease the sediment toxicity, biodegradation, formation oil contamination, PAH content, and retention of drilling fluids on drill cuttings of the discharge. This may include installing new pollution control equipment for compliance with the permit.

5. Permittees may reasonably take all actions necessary to achieve final compliance with the permit's limitations by August 16, 2002, except for the four-day sediment toxicity limit, with which the Permittees may reasonably take all actions necessary to achieve compliance by February 1, 2003. Upon submission of a Compliance Order Notice, permittees shall become Respondents under this administrative compliance order. The EPA will acknowledge receipt of Compliance Order Notices and send confirmation to Respondents.

6. Respondents are "persons," as that term is defined at Section 502(5) of the Act, 33 U.S.C. § 1362(5), and 40 C.F.R. § 122.2.

7. At all relevant times, Respondents owned or operated offshore platforms described in the Compliance Order Notices (herein "the facilities") and were therefore "owners or operators" within the meaning of 40 C.F.R. § 122.2.

8. At all relevant times, the facilities were "point sources" subject to a "discharge" of "pollutant[s]" with its discharges to the receiving waters of the Gulf of Mexico, which are "waters of the United States" within the meaning of Section 502 of the Act, 33 U.S.C. § 1362, and 40 C.F.R. § 122.2.

9. Because Respondents owned or operated facilities that were point sources subject to discharges of pollutants to waters of the U.S., Respondents and the facilities were subject to the Act and the NPDES program.

10. Under Section 301 of the Act, 33 U.S.C. § 1311, it is unlawful for any person to discharge any pollutant from a point source to waters of the United States, except with the authorization of, and in compliance with, an NPDES permit issued pursuant to Section 402 of the Act, 33 U.S.C. § 1342.

11. Respondents obtained NPDES permit coverage for discharges from new sources, existing sources, and new discharges in the Offshore Subcategory of the Oil and Gas Extraction Point Source Category.

12. Violations are those violations specified by Respondents in the Compliance Order Notices submitted to EPA per instructions in Order Paragraph A below.

13. Each violation of the conditions of the permit is a violation of Section 402 of the Act, 33 U.S.C. § 1342, or Section 301 of the Act, 33 U.S.C. § 1311, and may be subject to enforcement as set forth in Section 309 of the Act, 33 U.S.C. § 1319.

14. Given the large number of persons regulated under the permit, it would be impractical for EPA to issue individual compliance orders to all permit violators or conduct "show cause" meetings to establish individual compliance schedules for all such violators. A general compliance order setting forth procedures for establishing such schedules will avoid delays attendant on such meetings and issuance of individual compliance orders.

Order

Based on these Findings and pursuant to the authority of Sections 308(a) and 309(a) of the Act, EPA HEREBY ORDERS Respondents to take the following actions:

A. Any NPDES permittee in the Offshore Subcategory of the Oil and Gas Extraction Category for the Western Portion of the Outer Continental Shelf of the Gulf of Mexico with coverage under the permit may request coverage under this administrative compliance order by submitting a "Compliance Order Notice," to EPA Region 6. Such Compliance Order Notices must be postmarked before August 16, 2002, and no more than thirty (30) days after becoming aware of a violation, except for violations of the four-day sediment toxicity limit. For violations of the four-day sediment toxicity limit, all Compliance Order Notices must be postmarked before February 1, 2003, and no more than thirty (30) day after becoming aware of a violation. All Compliance Order Notices shall be sent to:

Ms. Sharon Haggard
Water Enforcement Branch (6EN-WC)
U.S. EPA, Region 6
P.O. Box 50625
Dallas, Texas 75250

The Compliance Order Notice must be signed and certified by an "authorized official" [40 CFR 122.22], and include the following:

i. Identification of the violating facility by name, location and NPDES facility identification number (GMG29####) (by lease block), the legal name and address of its operator, the name and address of an authorized official, as defined at 40 CFR 122.22, and the name, address, and telephone number of a contact person with whom EPA may further discuss the violation.
ii. A brief description of the violation, Respondent's opinion on the cause of the violation, and the basis for that opinion.
iii. A commitment to achieve final compliance with the permit by August 16, 2002, except for the four-day sediment toxicity limit; and a commitment to comply with the four-day sediment toxicity limit by February 1, 2003.

B. By August 16, 2002, Respondents shall complete all necessary pollution control changes for all discharges to come into compliance with the new permit modifications for all new limitations except the four-day sediment toxicity limit. By February 1, 2003, Respondents shall complete all necessary pollution control changes for all discharges to come into compliance with the new limitation for four-day sediment toxicity. This Order covers only those discharges by Respondents that are authorized by the permit published on December 18, 2001 (66 FR 65209) and listed in the Compliance Order Notices described above.

C. Respondents shall report all violations in accordance with permit requirements, including those that result during the period of this administrative compliance order. Part II.D.7. of the permit requires a 24 hour oral report or else a 24 hour e-mail to the following Internet e-mail address: r6genpermit@epa.gov. Additionally, Part II.D.7 of the permit requires a written submission within 5 days of the time the permittee becomes aware of the circumstances. All reports submitted to the EPA shall be signed by an authorized person in accordance with Part II.D.10. of the permit, and shall include the following certification set forth in this part of the permit:

I certify under penalty of law that this document and all attachments were prepared under my direction or supervision in accordance with a system designed to assure that qualified personnel properly gather and evaluate the information submitted. Based on my inquiry of the person or persons who manage the system, or those persons directly responsible for gathering the information, the information submitted is, to the best of my knowledge and belief, true, accurate, and complete. I am aware that there are significant penalties for submitting false information, including the possibility of fine and imprisonment for knowing violations.

If the report is made by e-mail, the 24 hour report should include this statement and be submitted by an authorized official. Please note that only authorized officials as defined by the permit may sign such documentation unless a delegation of authority letter has been sent to EPA Region 6.

D. Issuance of this Order shall not be deemed an election by EPA to forego any administrative, civil, or criminal action to seek penalties, fines, or any other relief appropriate under the Act for the violations cited herein. EPA reserves the right to seek any remedy available under the law that it deems appropriate for the violations cited.

E. Failure to comply with this Order or the Act can result in further administrative action, or a civil judicial action initiated by the U.S. Department of Justice. If the United States initiates a civil judicial action, Respondents will be subject to civil penalties of up to $27,500 per day per violation.

F. This Order is not an NPDES permit, and compliance with the terms and conditions of this Order does not relieve Respondents of their obligations to apply for and comply with any applicable permit, and comply with any applicable federal, state or local law or regulation.

G. This Order shall be effective on February 16, 2002.

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Permittees wishing to request coverage under this Order should submit a Compliance Order Notice to EPA Region 6. The following is an example Compliance Order Notice that you may use to correspond with EPA Region 6:

[Insert Return Address]

U.S. Environmental Protection Agency Region 6
Mr. Samuel Coleman, P.E.
c/o Ms. Sharon Haggard (6EN-WC)
P.O. Box 50625
Dallas, TX 75250

Dear Mr. Coleman:

I am writing you to request coverage under the General Administrative Compliance Order under the Clean Water Act giving my company a schedule for compliance in regards to my permit's modifications of February 16, 2002. My company is requesting coverage under the order as published in the Federal Register [66 FR ____________] and on the internet at http://www.epa.gov/earth1r6/6en/w/offshore/feb2002ao.htm.

The following is a brief description of a violation at this facility, my best opinion as the cause of the violation, and the basis for that opinion:

The following person is an authorized person, per 40 C.F.R. 122.22(d) and Part II.D.10. of the permit:

Name:__________________________________

Title:_________________________________

Address:_______________________________

_______________________________________

_______________________________________

_______________________________________

Telephone:_____________________________

The following person is the primary person for EPA to contact regarding NPDES compliance at this facility:

Name:__________________________________

Title:_________________________________

Address________________________________

_______________________________________

_______________________________________

_______________________________________

Telephone:_____________________________

E-mail:________________________________

I certify that I am an authorized official of my company as described in 40 C.F.R. 122.22(d) and Part II.D.10. of the permit.

I certify under penalty of law that this document and all attachments were prepared under my direction or supervision in accordance with a system designed to assure that qualified personnel properly gathered and evaluated the information submitted. Based on my inquiry of the person or persons who manage the system, or those person directly responsible for gathering the information, the information submitted is, to the best of my knowledge and belief, true, accurate, and complete. I am aware that there are significant penalties for submitting false information, including the possibility of fine and imprisonment for knowing violations.

Signature: ____________________________

Printed Name:__________________________

Title:_________________________________

Telephone Number:______________________