Oil Pollution Prevention; Spill Prevention, Control, and Countermeasure Rule Requirements--Amendments

Note: EPA no longer updates this information, but it may be useful as a reference or resource.
[Federal Register: October 15, 2007 (Volume 72, Number 198)]
[Proposed Rules]
[Page 58377-58445]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15oc07-16]
[[Page 58378]]

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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 112
[EPA-HQ-OPA-2007-0584; FRL-8479-7]
RIN 2050-AG16

Oil Pollution Prevention; Spill Prevention, Control, and
Countermeasure Rule Requirements--Amendments

AGENCY: Environmental Protection Agency.
ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA or the Agency) is
proposing to amend the Spill Prevention, Control, and Countermeasure
(SPCC) rule in order to provide increased clarity, to tailor
requirements to particular industry sectors, and to streamline certain
requirements for a facility owner or operator subject to the rule.
Specifically, EPA is proposing to: Exempt hot-mix asphalt; exempt
pesticide application equipment and related mix containers used at
farms; exempt heating oil containers at single-family residences; amend
the facility diagram requirement to provide additional flexibility for
all facilities; amend the definition of ``facility'' to clarify the
flexibility associated with describing a facility's boundaries; define
``loading/unloading rack'' to clarify the equipment subject to the
provisions for facility tank car and tank truck loading/unloading
racks; provide streamlined requirements for a subset of qualified
facilities; amend the general secondary containment requirement to
provide more clarity; amend the security requirements for all
facilities; amend the integrity testing requirements to allow a greater
amount of flexibility in the use of industry standards at all
facilities; amend the integrity testing requirements for containers
that store animal fat or vegetable oil and meet certain criteria;
streamline a number of requirements for oil production facilities; and
exempt completely buried oil storage tanks at nuclear power generation
facilities. These changes tailor requirements to particular industries
for easier and increased compliance, resulting in greater protection of
human health and the environment. EPA is also providing clarification
in the preamble to this proposed rule on additional issues raised by
the regulated community.

DATES: Comments must be received on or before December 14, 2007.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OPA-2007-0584, by one of the following methods:
     http://www.regulations.gov: Follow the on-line
instructions for submitting comments.
     Mail: EPA Docket, Environmental Protection Agency, Mail
code: 2822T, 1200 Pennsylvania Ave., NW., Washington, DC 20460.
     Hand Delivery: EPA/DC, EPA West, Room 3334, 1301
Constitution Ave., NW., Washington, DC. Such deliveries are only
accepted during the Docket's normal hours of operation, and special
arrangements should be made for deliveries of boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-HQ-OPA-
2007-0584. EPA's policy is that all comments received will be included
in the public docket without change and may be made available online at
http://www.regulations.gov, including any personal information provided,
unless the comment includes information claimed to be Confidential
Business Information (CBI) or other information whose disclosure is
restricted by statute. Do not submit information that you consider to
be CBI or otherwise protected through http://www.regulations.gov or e-mail.
The http://www.regulations.gov Web site is an ``anonymous access'' system,
which means EPA will not know your identity or contact information
unless you provide it in the body of your comment. If you send an e-mail 
comment directly to EPA without going through http://www.regulations.gov,
your e-mail address will be automatically captured and included as part
of the comment that is placed in the public docket and made available
on the Internet. If you submit an electronic comment, EPA recommends
that you include your name and other contact information in the body of
your comment and with any disk or CD-ROM you submit. If EPA cannot read
your comment due to technical difficulties and cannot contact you for
clarification, EPA may not be able to consider your comment. Electronic
files should avoid the use of special characters, any form of
encryption, and be free of any defects or viruses. For additional
information about EPA's public docket, visit the EPA Docket Center
homepage at http://www.epa.gov/epahome/dockets.htm.
    Docket: All documents in the docket are listed in the
http://www.regulations.gov index. Although listed in the index, some
information is not publicly available, e.g., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, will be publicly available only in hard copy.
Publicly available docket materials are available either electronically
in http://www.regulations.gov or in hard copy at the EPA Docket, EPA/DC, EPA
West, Room 3334, 1301 Constitution Ave., NW., Washington, DC. The
Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through
Friday, excluding legal holidays. The telephone number for the Public
Reading Room is (202) 566-1744, and the telephone number for the EPA
Docket is (202) 566-0276.

FOR FURTHER INFORMATION CONTACT: For general information, contact the
Superfund, TRI, EPCRA, RMP, and Oil Information Center at 800-424-9346
or TDD 800-553-7672 (hearing impaired). In the Washington, DC
metropolitan area, call 703-412-9810 or TDD 703-412-3323. For more
detailed information on specific aspects of this proposed rule, contact
either Vanessa E. Rodriguez at 202-564-7913
rodriguez.vanessa@epa.gov), or Mark W. Howard at 202-564-1964
howard.markw@epa.gov), U.S. Environmental Protection Agency, 1200
Pennsylvania Avenue, NW., Washington, DC 20460-0002, Mail Code 5104A.

SUPPLEMENTARY INFORMATION: The contents of this preamble are:

I. General Information
II. Entities Potentially Affected by This Proposed Rule
III. Statutory Authority and Delegation of Authority
IV. Background
V. This Action
    A. Hot-Mix Asphalt
    1. Proposed Exemption for Hot-Mix Asphalt
    2. Alternative Options Considered
    B. Farms
    1. Exemption for Pesticide Application Equipment and Related Mix
Containers
    2. Applicability of Mobile Refueler Requirements to Farm Nurse Tanks
    3. Alternative Options Considered
    C. Residential Heating Oil Containers
    1. Exemption for Residential Heating Oil Containers
    2. Alternative Option Considered: Exemption for Residential
Heating Oil Containers Only at Farms
    D. Definition of Facility
    1. Proposed Revisions to the Definition of Facility
    2. Determining the Components of a Facility: Examples of
Aggregation or Separation
    3. Alternative Options Considered
    E. Facility Diagram
    1. Proposed Revision to the Facility Diagram Requirement
    2. Indicating Complicated Areas of Piping or Oil-Filled
Equipment on a Facility Diagram
    F. Loading/Unloading Racks
    1. Proposed Loading/Unloading Rack Definition

[[Page 58379]]

    2. Requirements for Loading/Unloading Racks
    3. Exclusions
    4. Alternative Option Considered: No Action
    G. Tier I Qualified Facilities
    1. Eligibility Criteria
    2. Provisions for Tier I Qualified Facilities
    3. SPCC Plan Template
    4. Self-Certification and Plan Amendments
    5. Tier II Qualified Facility Requirements
    6. Alternative Options Considered: No Action
    H. General Secondary Containment
    1. Proposed Revisions to the General Secondary Containment Requirement
    2. Alternative Option Considered: No Action
    3. General Secondary Containment for Non-Transportation-Related
Tank Trucks
    I. Security
    1. Proposed Revisions to the Security Requirements
    2. Alternative Option Considered: No Action
    J. Integrity Testing
    1. Proposed Amendments to Integrity Testing Requirements
    2. Alternative Option Considered: No Action
    K. Animal Fats and Vegetable Oils
    1. Differentiation Criteria
    2. Required Recordkeeping
    L. Oil Production Facilities
    1. Definition of Production Facility
    2. SPCC Plan Preparation and Implementation
    3. Flowlines and Intra-facility Gathering Lines
    4. Flow-Through Process Vessels
    5. Small Oil Production Facilities
    6. Produced Water Storage Containers
    7. Clarification of the Definition of Permanently Closed Containers
    8. Oil and Natural Gas Pipeline Facilities
    M. Man-Made Structures
    1. Secondary Containment
    2. Integrity Testing
    N. Underground Emergency Diesel Generator Tanks at Nuclear Power
Stations
    O. Wind Turbines
    P. Technical Corrections
VII. Statutory and Executive Order Reviews
    A. Executive Order 12866--Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    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 &amp; Safety Risks
    H. Executive Order 13211--Actions That Significantly Affect
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act

I. General Information

    The Environmental Protection Agency (EPA or the Agency) is
proposing several amendments to the Spill Prevention, Control, and
Countermeasure (SPCC) rule to address a number of issues that have been
raised by the regulated community. These proposed amendments are
intended to increase clarity, tailor, and streamline certain
requirements for a facility owner or operator who is required to
prepare an SPCC Plan. Specifically:
     EPA proposes to exempt hot-mix asphalt (HMA) from the SPCC
requirements. EPA believes it is unnecessary to apply the SPCC
requirements to HMA. EPA would continue to regulate asphalt cement,
asphalt emulsions, and cutbacks, which are not hot-mix asphalt, but is
describing in this notice the flexibility contained in the SPCC rule
regarding these materials.
     EPA proposes certain tailored requirements benefiting
farms. Specifically, EPA proposes to exempt pesticide application
equipment and related mix containers used at farms, that may currently
be subject to the SPCC rule when crop oil or adjuvant oil are added to
formulations. In addition, EPA seeks to clarify that the amendment
related to mobile refuelers, as promulgated in the December 2006 rule
amendments (71 FR 77266, December 26, 2006), can be used by farmers to
address oil spill prevention requirements for fuel nurse tanks.
     EPA proposes to exempt residential heating oil containers,
i.e., those used solely at single-family residences, from the SPCC
requirements. This exemption would apply to aboveground containers, as
well as completely buried heating oil tanks at single-family
residences, including those located at farms.
     EPA proposes to modify the definition of ``facility'' to
clarify that contiguous or non-contiguous buildings, properties,
parcels, leases, structures, installations, pipes, or pipelines may be
considered separate facilities, and to specify that the ``facility''
definition governs the applicability of 40 CFR part 112. These proposed
revisions would allow an owner or operator to separate or aggregate
containers to determine the facility boundaries, based on such factors
as ownership or operation of the buildings, structures, containers, and
equipment on the site, the activities being conducted, property
boundaries, and other relevant considerations.
     EPA proposes to revise the facility diagram requirement at
Sec.  112.7(a)(3) to clarify how containers, fixed and mobile, are
identified on the facility diagram. Where facility diagrams become
complicated due to the presence of multiple fixed oil storage
containers or complex piping/transfer areas at a facility, the owner or
operator would be able to include that information separately in the
SPCC Plan in an accompanying table or key. For any mobile or portable
containers located in a certain area of the facility, an owner or
operator would be able to mark that area on the diagram where such
containers are stored. If the total number of mobile or portable
containers changes on a frequent basis, the owner or operator would be
able to indicate the potential range in number of containers and the
anticipated contents and capacities of the mobile or portable
containers maintained at the facility in the Plan.
     EPA proposes to define the term ``loading/unloading rack''
and specify that this definition would govern the applicability of the
provision at Sec.  112.7(h), Facility tank car and tank truck loading/
unloading rack. This amendment would provide clarity to the regulated
community over whether this provision applies to a facility.
Furthermore, EPA is proposing to specifically exclude oil production
facilities and farms from the requirements at Sec.  112.7(h), because
loading/unloading racks are not typically found at these facilities
(loading/unloading activities at these facilities will remain subject
to the general secondary containment requirements of Sec.  112.7(c)).
EPA also proposes editorial revisions to the provision at Sec. 
112.7(h) for clarity.
     EPA proposes to streamline and tailor the SPCC
requirements for a subset of qualified facilities. Qualified facilities
were addressed in a recent amendment to the SPCC rule (71 FR 77266,
December 26, 2006). The owner or operator of such a facility was
provided an option to self-certify his SPCC Plan and comply with other
streamlined requirements. This proposed rule further defines a subset
of qualified facilities (``Tier I qualified facilities'') as those that
meet the current qualified facilities eligibility criteria and that
have no oil storage containers with an individual storage capacity
greater than 5,000 gallons. A Tier I qualified facility would have the
option to complete a self-certified SPCC Plan template (proposed as
Appendix G to 40 CFR part 112) in lieu of a full SPCC Plan. By
completing the SPCC Plan template, an owner or operator of a Tier I
qualified facility would certify that the facility complies with a set
of streamlined SPCC rule requirements. All other qualified facilities
will be designated ``Tier II qualified facilities''.
     EPA proposes to amend the general secondary containment
requirement at Sec.  112.7(c) to make clear that the scope of secondary
containment takes into

[[Page 58380]]

consideration the typical failure mode, and most likely quantity of oil
that would be discharged, consistent with current Agency guidance. This
proposed amendment would also provide additional examples of prevention
systems for onshore facilities found at Sec.  112.7(c)(1).
     EPA proposes to amend the facility security requirements
at Sec.  112.7(g) to allow an owner or operator to tailor his security
measures to the facility's specific characteristics and location. A
facility owner or operator would be required to describe in the SPCC
Plan how he secures and controls access to the oil handling,
processing, and storage areas; secures master flow and drain valves;
prevents unauthorized access to starter controls on oil pumps; secures
out-of-service and loading/unloading connections of oil pipelines; and
addresses the appropriateness of security lighting to both prevent acts
of vandalism and assist in the discovery of oil discharges. This
proposed action would extend the streamlined security requirements that
EPA provided to a qualified facility in the December 2006 final rule
(71 FR 77266, December 26, 2006) to all facilities subject to the
security requirements.
     EPA proposes to amend the requirements at Sec. Sec. 
112.8(c)(6) and 112.12(c)(6) to provide flexibility in complying with
bulk storage container integrity testing requirements. Specifically,
EPA is proposing to modify the current provision to allow an owner or
operator to consult and rely on industry standards to determine the
appropriate qualifications for tank inspectors/testing personnel and
the type/frequency of integrity testing required for a particular
container size and configuration. This proposed action would extend the
streamlined bulk storage container inspection requirement that EPA
provided to qualified facilities in the December 2006 final rule (71 FR
77266, December 26, 2006) to all facilities subject to the integrity
testing provision.
     EPA proposes to differentiate the integrity testing
requirements at Sec.  112.12(c)(6) for an owner or operator of a
facility that handles certain types of animal fats and vegetable oils.
Specifically, EPA proposes to provide the PE or an owner/operator
certifying an SPCC Plan with the flexibility to determine the scope of
integrity testing that is appropriate for containers that store animal
fats or vegetable oil and that meet other criteria.
     EPA proposes several amendments to tailor the requirements
for oil production facilities to address a number of concerns that have
been raised by representatives of this sector. Specifically, EPA is
proposing to: Modify the definition of production facility, consistent
with the proposed amendments to the definition of facility; extend the
timeframe by which a new oil production facility must prepare and
implement an SPCC Plan; exempt flow-through process vessels at oil
production facilities from the sized secondary containment requirements
while maintaining general secondary containment requirements and
requiring additional oil spill prevention measures; exempt flowlines
and intra-facility gathering lines at oil production facilities from
all secondary containment requirements, while establishing more
specific requirements for a flowline/intra-facility gathering line
maintenance program and contingency planning; and clarify the
definition of ``permanently closed'' as it applies to an oil production
facility. EPA also describes approaches that would establish
alternative criteria for an oil production facility to be eligible to
self-certify an SPCC Plan as a qualified facility, and approaches to
address produced water storage containers at oil production facilities.
     EPA proposes to exempt completely buried oil storage tanks
at nuclear power generation facilities that are subject to design
criteria under Nuclear Regulatory Commission regulations.
    In this notice, EPA is also clarifying a number of issues of
concern to the regulated community, including: the consideration of
man-made structures in determining how to comply with SPCC rule
requirements; and the applicability of the rule to wind turbines that
are used to produce electricity. EPA also proposes technical
corrections to Sec. Sec.  112.3 and 112.12.

II. Entities Potentially Affected by This Proposed Rule

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               Industry sector                         NAICS code
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Oil Production...............................                     211111
Farms........................................                   111, 112
Electric Utility Plants......................                       2211
Petroleum Refining and Related Industries....                        324
Chemical Manufacturing.......................                        325
Food Manufacturing...........................                   311, 312
Manufacturing Facilities Using and Storing                      311, 325
 Animal Fats and Vegetable Oils..............
Metal Manufacturing..........................                   331, 332
Other Manufacturing..........................                      31-33
Real Estate Rental and Leasing...............                    531-533
Retail Trade.................................      441-446, 448, 451-454
Contract Construction........................                         23
Wholesale Trade..............................                         42
Other Commercial.............................     492, 541, 551, 561-562
Transportation...............................                    481-488
Arts Entertainment &amp; Recreation..............                    711-713
Other Services (Except Public Administration)                    811-813
Petroleum Bulk Stations and Terminals........                       4247
Education....................................                         61
Hospitals &amp; Other Health Care................                   621, 622
Accommodation and Food Services..............                   721, 722
Fuel Oil Dealers.............................                      45431
Gasoline stations............................                       4471
Information Finance and Insurance............                     51, 52
Mining.......................................                        212
Warehousing and Storage......................                        493
Religious Organizations......................                     813110
Military Installations.......................                     928110
Pipelines....................................                4861, 48691

[[Page 58381]]

Government...................................                         92
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    The list of potentially affected entities in the above table may
not be exhaustive. The Agency's goal is to provide a guide for readers
to consider regarding entities that potentially could be affected by
this action. However, this action may affect other entities not listed
in this table. If you have questions regarding the applicability of
this action to a particular entity, consult the person listed in the
preceding section entitled FOR FURTHER INFORMATION CONTACT.

III. Statutory Authority and Delegation of Authority

    Section 311(j)(1)(C) of the Clean Water Act (CWA or the Act), 33
U.S.C. 1321(j)(1)(C), requires the President to issue regulations
establishing procedures, methods, equipment, and other requirements to
prevent discharges of oil to navigable waters and adjoining shorelines
from vessels and facilities and to contain such discharges. The
President delegated the authority to regulate non-transportation-
related onshore facilities to EPA in Executive Order 11548 (35 FR
11677, July 22, 1970), which was replaced by Executive Order 12777 (56
FR 54757, October 22, 1991). A Memorandum of Understanding (MOU)
between the U.S. Department of Transportation (DOT) and EPA (36 FR
24080, November 24, 1971) established the definitions of
transportation-related and non-transportation-related facilities. An
MOU between EPA, the U.S. Department of the Interior (DOI), and DOT (59
FR 34102, July 1, 1994) re-delegated the responsibility to regulate
certain offshore facilities from DOI to EPA.

IV. Background

    The SPCC rule was originally promulgated on December 11, 1973 (38
FR 34164). On July 17, 2002, EPA published a final rule amending the
SPCC rule, formally known as the Oil Pollution Prevention regulation
(40 CFR part 112). The 2002 rule included revised requirements for SPCC
Plans and for Facility Response Plans (FRPs). It also included new
subparts outlining the requirements for various classes of oil; revised
the applicability of the regulation; amended the requirements for
completing SPCC Plans; and made other modifications (67 FR 47042). The
revised rule became effective on August 16, 2002. After publication of
this rule, several members of the regulated community filed legal
challenges to certain aspects of the rule. All but one of the issues
raised in the litigation have been settled, following which EPA
published clarifications in the Federal Register to several aspects of
the revised rule (69 FR 29728, May 25, 2004).\1\ In addition, concerns
were raised about the implementability of certain aspects of the 2002
rule.
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    \1\ American Petroleum Institute v. Leavitt, No. 1:102CV02247
PLF and consolidated cases (D.D.C. filed Nov. 14, 2002). The
remaining issue to be decided concerns the definition of ``navigable
waters'' in Sec.  112.2.
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    As a result, EPA proposed amendments to the SPCC rule in December
2005 and finalized them in December 2006 to address a number of issues,
including those pertaining to certain ``qualified'' facilities,
qualified oil-filled operational equipment, motive power containers,
mobile refuelers, provisions inapplicable to animal fats and vegetable
oils, and the compliance date for farms. See the final rule which
published in the Federal Register at 71 FR 77266 (December 26, 2006)
for a more detailed discussion of these amendments.
    Also, in December 2005, EPA released the SPCC Guidance for Regional
Inspectors. EPA intends to issue revisions to this guidance document to
incorporate changes consistent with the December 2006 amendments to the
SPCC rule (71 FR 77266, December 26, 2006). This guidance document is
intended to assist regional inspectors in reviewing the implementation
of the SPCC rule at a regulated facility. The guidance document is
designed to facilitate an understanding of the rule's applicability, to
help clarify the role of the inspector in the review and evaluation of
a facility owner or operator's compliance with the performance-based
SPCC requirements, and to provide a consistent national policy on
several SPCC-related issues. The guidance is available to the owner or
operator of a facility that may be subject to the SPCC rule and to the
general public on the Agency's Web site at http://www.epa.gov/
emergencies. This guidance is a living document and will be revised, as
necessary, to reflect any relevant future regulatory amendments,
including any final rule based on this proposed action.
    In addition, EPA has amended the dates for compliance with the July
2002 amendments to the SPCC rule by extending the dates for preparing
or amending, and implementing revised SPCC Plans in 40 CFR 112.3(a),
(b), and (c), most recently by final rule published May 16, 2007 (72 FR
27443). EPA took the most recent action to provide facilities time to
fully understand the amendments to the SPCC rule finalized in December
2006 and to allow potentially affected owners and operators an
opportunity to make any changes to their facilities and to their SPCC
Plans, as well as to provide time for the Agency to take final action
on this proposal. Additionally, EPA intends to provide the regulated
community time to review and understand any revised material presented
in the SPCC Guidance for Regional Inspectors. Please see the Federal
Register notice (72 FR 27443, May 16, 2007) for further discussion of
the compliance date extensions.
    The December 2006 final rule (71 FR 77266, December 26, 2006)
addressed only certain areas of the SPCC requirements and specific
issues and concerns raised by the regulated community. As highlighted
in the EPA Regulatory Agenda and the 2005 Office of Management and
Budget report on ``Regulatory Reform of the U.S. Manufacturing
Sector,'' EPA is proposing amendments in this notice to address other
areas where further changes may be appropriate.

V. This Action

A. Hot-mix Asphalt

    Hot-mix asphalt (HMA) is a blend of asphalt cement (AC) and
aggregate material, such as stone, sand, or gravel, which is formed
into final paving products for use on roads and parking lots. All types
of asphalt, including HMA, are petroleum oil products. As a result, a
facility that stores and handles HMA may currently be regulated under
the SPCC rule, if the applicability criteria are met (e.g., storage
capacity thresholds and potential for a discharge into navigable waters
or adjoining shorelines). As such, SPCC requirements, including
secondary containment, apply to HMA containers. However, EPA never
intended that HMA be included as part of a facility's SPCC Plan,
particularly facilities which may be subject to the SPCC requirements
solely because of the presence of HMA. Taken to the extreme, it could
be argued that roads, parking lots, or other asphalt paving projects

[[Page 58382]]

would be part of a facility's SPCC Plan. That was not and is not the
Agency's intent.
    In addition, because this material is unlikely to flow as a result
of the entrained aggregate, there are few circumstances in which a
discharge of HMA would reach navigable waters or adjoining shorelines.
As a result, EPA is proposing to revise the rule to eliminate the
requirement for an owner or operator of a facility otherwise subject to
the SPCC rule to include a HMA container in the facility's SPCC Plan or
aggregate storage capacity calculations.
1. Proposed Exemption for Hot-Mix Asphalt
    This proposed rule amendment would exempt HMA from SPCC rule
applicability by adding a new paragraph (8) under the general
applicability section, Sec.  112.1(d). Furthermore, EPA proposes to
modify Sec.  112.1(d)(2) so that the capacity of storage containers
solely containing HMA would not be counted toward the facility oil
storage capacity calculation. The Regional Administrator would continue
to have the option under Sec.  112.1(f), however, to require an owner
or operator of a facility, including one solely handling HMA, to
prepare or amend and implement an SPCC Plan or any applicable part, to
include HMA containers if he determines that it is necessary in order
to prevent a discharge of oil into navigable waters or adjoining shorelines.
    For those substances that are not eligible for the proposed
exemption, the SPCC rule provides the facility owner or operator with
significant flexibility to select prevention and control measures that
are appropriate and cost effective for the facility and type of product
being stored. For example, the secondary containment requirements of
the SPCC rule may be satisfied if the secondary containment system,
including walls and floor, are capable of containing the oil and are
constructed so that any discharge from a primary containment system
will not escape secondary containment before cleanup occurs (Sec. 
112.7(c)) and diked areas are sufficiently impervious to contain the
oil (Sec.  112.8(c)(2)). Therefore, the flow properties of asphalt
cement (AC), for example, (as for any oil) may be considered in
designing appropriate means of containment. If, once cooled, the oil
remains in place, an effective means of secondary containment may
involve surrounding the bulk storage container with an earthen berm
that will contain the oil until it can solidify. As stated in the SPCC
Guidance for Regional Inspectors (version 1.0, November 28, 2005),
``The suitability of earthen material for secondary containment systems
may depend on the properties of both the product stored and the soil.
For example, compacted local soil may be suitable to contain a viscous
product, such as liquid AC, but may not be suitable to contain
gasoline.'' If an owner or operator chooses to use an earthen berm as a
method of secondary containment, the facility owner or operator should
consider, among other factors, the effect of weather, vehicle and
worker movement, access, and safety, in accordance with good
engineering practice.
    Furthermore, a facility owner or operator does not necessarily need
to construct a berm around an asphalt cement container to satisfy the
secondary containment requirements; he may opt to use a storm water
retention pond or other similar structure or existing natural terrain
features that would serve to divert, remotely impound, and prevent the
discharge to navigable waters or adjoining shorelines. EPA notes that
oil discharged into secondary containment needs to be removed promptly
so that the containment system retains its appropriate capacity.
    Finally, the Agency would note that the SPCC rule only applies to
facilities that, due to their location, can reasonably be expected to
discharge oil to navigable waters or adjoining shorelines. In
determining whether there is a reasonable expectation of discharge, an
owner or operator of a facility may consider the nature and flow
properties of the oils handled at the facility. Therefore, the owner or
operator of a facility that stores or handles only those oils that are
solid at ambient temperatures may conclude that the facility is not
subject to the SPCC rule. However, if a facility owner or operator
determines that there is a reasonable expectation to discharge oil to
navigable waters or adjoining shorelines for a single oil container,
all oil containers at the facility are subject to the rule's requirements.
    Although this proposed amendment would provide an exemption from
the SPCC requirements for containers of HMA, HMA manufacturers and
other facilities that use, store, distribute, or otherwise handle HMA
may still be subject to the SPCC requirements due to the storage
capacity of other types of oils (e.g., No. 2 fuel oil and heat transfer
oils) at the facility.
    The Agency seeks comments on the proposed exemption for HMA. Any
alternative approach presented must include an appropriate rationale
and supporting data in order for the Agency to be able to consider it
for final action.
2. Alternative Options Considered
a. No Action
    EPA considered taking no regulatory action regarding this issue.
Under this option, a facility owner or operator would continue to be
required to consider HMA in calculating the facility's total oil
storage capacity, and comply with all SPCC requirements related to
storage or transfer of HMA. The owner or operator would continue to
benefit from the flexibility in the SPCC rule to provide secondary
containment measures that are appropriate and cost effective for the
facility and the asphalt it stores. EPA believes that it is unnecessary
for an owner or operator of a facility that constructs roads, parking
lots, or sidewalks to develop an SPCC Plan, solely for the routine end
use of HMA as part of these operations. Moreover, as HMA is unlikely to
flow as a result of the entrained aggregate, the Agency believes there
are few circumstances in which a discharge of HMA would reach navigable
waters or adjoining shorelines. Therefore, EPA chose not to propose
this option.
b. Exemption for Asphalt Cement
    EPA considered exempting both HMA and AC from the requirements of
the SPCC rule, but chose not to propose such an option. In documents
submitted to EPA, the asphalt industry argues that AC poses a low risk
to navigable waters and adjoining shorelines, claiming that it does not
flow if spilled on the ground. The industry further argues that asphalt
facilities are either already covered under other environmentally
protective regulations or are granted a specific exemption from other
regulations due the unique nature of the product, and that the cost of
complying with the SPCC regulation is disproportionate to the risk posed.
    Because of the operational conditions under which AC is used and
stored, AC does pose a risk of being discharged into navigable waters
and adjoining shorelines. (See EPA's report, Asphalt Under the Spill
Prevention, Control, and Countermeasure Regulation, August 29, 2007, in
the docket for this proposal.) Although AC is semi-solid or solid at
ambient temperature and pressure, it is generally stored at elevated
temperatures. Hot AC is liquid--similar to other semi-solid oils, such
as paraffin wax and heavy bunker fuels--and therefore is capable of
flowing. All of these oils are regulated under the SPCC

[[Page 58383]]

rule to prevent discharges to navigable waters and adjoining shorelines.
    EPA believes that the threat that AC, as well as other semi-solid
oils, pose to navigable waters and adjoining shorelines can be
effectively addressed by implementing the procedures and measures
required under the SPCC regulation. As discussed previously, the
current SPCC regulation provides flexibility to an asphalt facility
owner and operator to account for site- and product-specific
characteristics in implementing measures to prevent oil discharges in a
cost-effective manner.
    The Agency welcomes comments on these or other alternatives that
could serve to address HMA, while at the same time maintaining
appropriate levels of environmental protection. Any alternative
approaches presented must include an appropriate rationale and
supporting data in order for the Agency to be able to consider them for
final action.

B. Farms

    The owner or operator of a farm, by virtue of storing or using oil,
is potentially subject to the SPCC requirements. The December 2006
amendments to the SPCC rule (71 FR 77266, December 26, 2006) defined a
farm as ``* * * a facility on a tract of land devoted to the production
of crops or raising of animals, including fish, which produced and
sold, or normally would have produced and sold, $1,000 or more of
agricultural products during a year.'' In providing the option for an
owner or operator of a facility that stores 10,000 gallons of oil or
less and meets other qualifying criteria to self-certify his SPCC Plan
in lieu of review and certification by a Professional Engineer, the
December 2006 amendments offered relief to an estimated 95 percent of
all SPCC-regulated farms. The 2006 amendments also exempted mobile
refuelers, which include fuel nurse tanks on farms, from the sized
secondary containment requirements for bulk storage containers (see
more detailed discussion regarding nurse tanks below). Finally, the
2006 amendments extended the date by which farms must amend their
existing SPCC Plans to come into compliance with the July 2002 rule
changes until the Agency publishes a final rule in the Federal Register
establishing a new compliance date. This proposal does not affect this
extended compliance date for farms. The Agency will propose a new
compliance date for farms in the Federal Register at a later date.
    While the December 2006 amendments provided streamlined
requirements for most of the farms that are subject to the SPCC
requirements, EPA believes further amendments to the SPCC rule are
appropriate considering the unique characteristics of farm facilities,
including their geographic scale, configuration, land ownership and
lease structure, and on-farm activities. Specifically, EPA recognizes
that a farm: May be privately owned and may contain the residence of
the owner or operator; has a configuration that varies across the
country, from farm to farm and season to season; contains low-volume
oil storage that is often dispersed across different land parcels
separated by roads and natural barriers; has multiple fueling sites; is
located in a remote area; stores oil on-site for on-farm use and not
for further distribution in commerce; uses oil seasonally in different
quantities; and leases a significant amount of land to or from
secondary parties. For these reasons, EPA is proposing additional
amendments to the SPCC rule that further benefit farms.
    As discussed in Section G of this preamble, EPA is proposing an
additional option for a subset of qualified facilities (``Tier I'')
that have a maximum individual oil storage container capacity of 5,000
gallons, by allowing these facilities to complete a simplified self-
certified SPCC Plan template in lieu of a full SPCC Plan. This option
would be available to any facility that meets the Tier I qualification
criteria, including a farm. EPA expects that at least 128,000 farms (or
more than 84% of the farms regulated by the SPCC rule) may be eligible
for this proposed option.
    EPA is also proposing to clarify the definition of ``facility'' in
the SPCC rule, as discussed in Section D of this preamble. The proposed
definition would clarify the existing flexibility for a facility owner
or operator, particularly for a farmer, to define oil storage areas
located on either contiguous or non-contiguous parcels of land (e.g.,
satellite storage areas) as separate facilities for the purpose of
determining SPCC applicability and preparing/implementing an SPCC Plan.
    Under this proposal (see Section C), EPA would exempt heating oil
containers at single-family residences. EPA understands that farms
often include, within the geographical confines of the facility, the
residence of the owner or operator, and so the Agency believes this
proposed amendment also will be of benefit to farms.
    This proposal (see Section I) also addresses streamlining of the
security requirements under Sec.  112.7(g) to allow more flexibility in
determining how best to secure and control access to the oil handling,
processing and storage areas; secure master flow and drain valves;
prevent unauthorized access to starter controls on oil pumps; secure
out-of-service and loading/unloading connections of oil pipelines; and
address the appropriateness of security lighting to both prevent acts
of vandalism and assist in the discovery of oil discharges. This
amendment will particularly benefit the owner or operator of a farm,
because it allows for consideration of site-specific factors in
determining how best to design security for the facility to prevent
vandalism and detect spills from oil-handling areas. An owner or
operator of a farm may also benefit from the currently proposed
amendments related to loading/unloading racks (Section F of this
preamble) and integrity testing (Section J).
    The Agency believes that both the amendments finalized in 2006 and
those being proposed in this notice provide significant flexibility to
the agricultural sector. In this action, the Agency also is proposing
further amendments to the SPCC rule to address concerns specific to the
agricultural community regarding pesticide application equipment and
related mix containers used at farms. The proposed amendments was
informed by information collected by EPA through site visits to farms
and numerous consultations with the U.S. Department of Agriculture
(USDA). Farm site visits helped EPA further understand oil storage
characteristics at a variety of farm operation types and sizes. The
site visits included dairy farms, an orchard, an agribusiness supply
company, and two rice farms.
1. Exemption for Pesticide Application Equipment and Related Mix Containers
    EPA is proposing to amend the SPCC rule by adding a new paragraph
(10) under the general applicability section, Sec.  112.1(d) to exempt
pesticide application equipment and related mix containers used at
farms from the SPCC requirements. EPA also proposes to modify Sec. 
112.1(d)(2) so that the capacity of these pesticide application
equipment and related mix containers (i.e., containers used to mix
pesticides with oil immediately prior to application) would not be
counted toward the facility oil storage capacity calculation. This
equipment includes ground boom applicators, airblast sprayers, and
specialty aircraft that are used to apply measured quantities of
pesticides to crops and/or soil. The pesticide formulation may include
petroleum-or vegetable-based oils in concentrated formulations or may

[[Page 58384]]

contain crop oil or adjuvant oil in the mix formulations added just
prior to application, thereby potentially subjecting certain pesticide
containers to the SPCC requirements, such as those for bulk storage
containers under Sec. Sec.  112.8(c) and 112.12(c). Containers storing
oil prior to blending it with the pesticide, and containers used to
store any pesticides after they have been mixed with oil, are considered 
bulk storage containers and are regulated as such under the SPCC rule.
    EPA regulates pesticides under the Federal Insecticide, Fungicide,
and Rodenticide Act (FIFRA), which establishes requirements for the
registration and labeling of pesticides. Sections 19(e) and (f) of
FIFRA grant EPA broad authority to establish standards and procedures
to assure the safe use, reuse, storage, and disposal of pesticide
containers. Under this authority, EPA established standards, including
design and labeling requirements for pesticide containers and bulk
pesticide containment. These standards were promulgated on August 16,
2006 for certain facilities that use, reuse, or store pesticides in
containers with capacities of 500 gallons or greater (Standards for
Pesticide Containers and Containment, 40 CFR parts 156 and 165; see 71
FR 47330, August 16, 2006). Facilities subject to these standards
include pesticide registrants, agricultural retailers, and commercial
pesticide applicators; however, farms were exempted from these
standards. In evaluating the risk posed by pesticide containers and
application equipment when promulgating the Standards for Pesticide
Containment Structures in 40 CFR part 165, Subpart E, EPA noted that
on-farm bulk storage of pesticides remains rare as opposed to on-farm
bulk storage of oil, such as off-road diesel, on-road diesel and
gasoline fuels. Additionally, EPA found that there was insufficient
evidence of contamination occurring as a result of these containers or
equipment to warrant their regulation under the pesticide container-
containment rule. However, EPA reserved the option of reexamining the
need for Federal regulation of on-farm pesticide bulk storage in the
future if it became apparent that the application or use of pesticides
was having significant detrimental impacts. Similarly, EPA does not
believe that the regulation of pesticide application equipment and
related mix containers used at a farm is appropriate under the SPCC rule.
    EPA believes that, on a farm, the storage and application of
pesticide mixtures that may contain oil just prior to application can
be addressed through the use of best management practices (BMPs) that
minimize the potential for discharges to navigable waters and adjoining
shorelines. For example, a number of states have ``Farm*A*Syst''
programs (partnerships between government agencies and private business
that foster pollution prevention on farms) that detail on-farm
pesticide BMPs such as: (1) Adhere to pesticide label instructions and
prepare only the necessary amount needed for immediate use; (2) prepare
the pesticide mix immediately before application; (3) the equipment
spray tank should be half full with water prior to mixing in the
pesticide formulation; and (4) pesticides should be mixed and loaded on
a concrete pad (Improving Storage and Handling of Pesticides, Farm-a-
Syst North Carolina, April 1997. Found at http://www.soil.ncsu.edu/assist/
pesticides/.  This document is also available in the docket 
for this rule proposal).
    EPA requests comments on the proposed exemption of pesticide
application equipment and related mix containers from SPCC
applicability. Any alternative approach presented must include an
appropriate rationale and supporting data in order for the Agency to be
able to consider it for final action.
2. Applicability of Mobile Refueler Requirements to Farm Nurse Tanks
    In the December 2006 amendments to the SPCC rule (71 FR 77266,
December 26, 2006), EPA exempted mobile refuelers from the sized
secondary containment requirements applicable to bulk storage
containers. In the amended regulation, EPA defined a mobile refueler as
``a bulk storage container onboard a vehicle or towed, that is designed
or used solely to store and transport fuel for transfer into or from an
aircraft, motor vehicle, locomotive, vessel, ground service equipment,
or other oil storage container.'' (Sec.  112.2). In this action, EPA
seeks to clarify that the definition of mobile refueler includes a
nurse tank, which is a mobile vessel used at farms to store and
transport fuel for transfers to or from farm equipment, such as
tractors and combines, and to other bulk storage containers, such as
containers used to provide fuel to wellhead/relift pumps at rice farms.
A nurse tank is often mounted on a trailer for transport around the
farm, and EPA believes that this function is consistent with that of a
mobile refueler. A nurse tank, like other types of mobile refuelers, is
exempt from the sized secondary containment requirements, but would
need to meet the general secondary containment requirements at Sec. 
112.7(c).
    EPA does not believe that additional regulatory action is warranted
to clarify that a nurse tank at a farm can be considered a mobile
refueler. EPA welcomes comments on this approach.
3. Alternative Options Considered
    In developing the amendments proposed in this notice, EPA
considered the following alternatives for differentiating the SPCC
requirements for farms:
a. No Action
    With the promulgation of the final amendments to the SPCC rule on
December 26, 2006, EPA estimated that approximately 145,000 of the
152,000 farms subject to the SPCC rule (95 percent of regulated farms)
identified in the Regulatory Impact Analysis may be eligible for the
``qualified facility'' or self-certification option. Additionally, EPA
is proposing an alternative compliance option for a subset of qualified
facilities by adding a new tier, identified as Tier I qualified
facilities, that would provide even more flexibility to farms.
    EPA believes that considerable flexibility was provided in the
December 2006 amendments, as well as other amendments being proposed in
this notice to address the definition of facility, the security and
integrity testing requirements, residential heating oil containers, and
further streamlining of the requirements for qualified facilities.
Nevertheless, EPA has concluded based on comments from agricultural
stakeholders, farm-related site visits, and the August 16, 2006 final
action concerning pesticide containers (71 FR 47330), that additional
amendments to the SPCC rule related to farms are necessary. Therefore,
EPA chose not to propose this ``no action'' option.
b. Exempt Farms Below a Certain Storage Capacity Threshold
    EPA considered exempting farms that stored oil below a certain
storage capacity threshold from the SPCC requirements, but determined
that sufficient data to support such an exemption exclusive to farms do
not currently exist. Storage tanks found at farms are similar in
function and design as those found at other types of facilities, and
therefore have a similar potential for a discharge. Thus, an effort to
substantiate an exemption for a subset of affected farms below a
certain threshold would be difficult. As a result, EPA chose not to
propose this option.
    The Agency welcomes comments on this or other alternatives that
could serve to address the needs of the agricultural sector, while at
the same

[[Page 58385]]

time maintaining appropriate levels of environmental protection. Any
alternative approaches presented must include an appropriate rationale
and supporting data in order for the Agency to be able to consider them
for final action.
c. Alternative Qualified Facility Eligibility Criteria for Farms
    Under Sec.  112.6, a ``facility'' that has an aggregate above
ground storage capacity of 10,000 gallons or less and that has not had
a single discharge exceeding 1,000 U.S. gallons or two discharges each
exceeding 42 U.S. gallons within any twelve month period in the three
years prior is eligible for the ``qualified facility'' Plan
requirements (i.e. a self-certified Plan in lieu of a PE certified
Plan). The current criteria for ``qualified facilities,'' found at
Sec.  112.3(g), treat farms like all other facilities. However, there
may be alternative criteria unique to farms that would be appropriate
for identifying qualified facilities. EPA requests comment on (1)
whether a change in the criteria is appropriate for farms; and (2)
whether a higher threshold is appropriate for farms. Any alternative
approach presented must include an appropriate rationale in order for
the Agency to be able to consider it for final action.

C. Residential Heating Oil Containers

    EPA understands that many regulated facilities, including farms,
may include within the geographical confines of the facility the
residence of the owner or operator. EPA did not intend to regulate
residential uses of oil (i.e., those at non-commercial buildings) under
the SPCC rule. For example, in 1973, EPA set the minimum facility
aggregate storage capacity threshold for SPCC applicability (1,320
gallons) by considering common sizes of residential heating oil
containers. The Agency stated in the preamble to the 1973 final SPCC
rule (38 FR 34164, December 11, 1973) that containers of 660 gallons
are the normal domestic code size for nonburied heating oil containers,
and that buildings may have two such containers. Thus, the presence of
a heating oil container at a residence was generally not intended, by
itself, to trigger SPCC applicability since residences generally do not
have significant quantities of other types of oil. However, at the time
the rule was originally promulgated, the Agency did not consider
residential heating oil containers that may be co-located with
businesses. As a result, EPA recognizes that owners and operators may
be counting these residential containers in determining the
applicability of the SPCC rule to their facility, and including these
containers in their SPCC Plans. Therefore, EPA proposes to amend the
rule to exempt single-family residential heating oil containers.
    This exemption would apply to aboveground as well as completely
buried heating oil tanks at single-family residences. Heating oil tanks
used for on-site consumptive use of oil are specifically exempted from
the 40 CFR part 280 requirements, which apply to underground storage
tanks (USTs). The SPCC rule does not apply to ``any completely buried
storage tank * * * that is subject to all of the technical requirements
of part 280 of this chapter or a State program approved under part 281
of this chapter * * * '' (Sec.  112.1(d)(4)). Because USTs used for
storing heating oil for consumptive use on the premises where stored
are exempted from part 280, completely buried tanks used for
residential heating would currently need to be included in the storage
capacity of an SPCC-regulated facility, and would be subject to
applicable SPCC requirements.
1. Exemption for Residential Heating Oil Containers
    EPA is proposing to specifically exempt from SPCC applicability
containers that are used to store oil for the sole purpose of heating
single-family residences (including residences at a farm) by adding a
new paragraph (9) under the general applicability section, Sec. 
112.1(d). EPA also proposes to modify Sec.  112.1(d)(2) so that the
capacity of single-family residential heating oil containers would not
be counted toward facility oil storage.
    The current proposal would remove from SPCC applicability
containers (both aboveground and completely buried) located at single-
family residences that are used solely to store heating oil used to
heat the residence. Under the proposed amendments, the owner or
operator would not count any residential heating oil container as part
of the facility's aggregate storage capacity for the purpose of
determining SPCC applicability, and no SPCC requirements would apply to
the exempted containers. The SPCC requirements would continue to apply,
however, to containers for oil used to heat other non-residential
buildings within a facility, because the exemption covers only
residential heating oil containers.
    This exemption is not limited to facilities with only one single-
family home; EPA recognizes that there may be multiple single-family
homes within one facility. For example, a farm that has multiple
single-family homes within its boundaries would not need to consider
the residential heating oil tanks at any of those homes for purposes of
SPCC applicability. Groups of single-family homes within a military
base would similarly be exempted.
    EPA requests comment on this proposed exemption for single-family
residential heating oil containers, and whether there is a better way
to characterize containers used to store oil for heating buildings with
a residential, rather than commercial, use, including whether there are
any unique situations in which a residential heating oil tank would be
subject to the SPCC rule because the aboveground oil storage capacity
is greater than 1,320 U.S. gallons. Any alternative approach presented
must include an appropriate rationale in order for the Agency to be
able to consider it for final action.
2. Alternative Option Considered: Exemption for Residential Heating Oil
Containers Only at Farms
    EPA initially considered providing an exemption only for
residential heating oil containers located at farms, because farms
commonly include, within the geographical confines of the facility, the
residence of the farmer. Under this option, only heating oil containers
associated with residences on farms would benefit from an exemption
from the SPCC rule. However, EPA understands that a facility associated
with another industry sector, such as a military base or university, or
a small business run out of the owner's home, may also contain a
residential heating oil container. The Agency determined that there was
no rationale to support not expanding the exemption to all residential
heating oil containers. Therefore, the Agency chose not to propose this
option.
    EPA requests comment on this option, and whether an exemption for
residential heating oil containers should be limited to any specific
sector. Any alternative approach presented must include an appropriate
rationale in order for the Agency to be able to consider it for final
action.

D. Definition of Facility

    EPA first defined both ``facility'' and ``production facility'' at
Sec.  112.2 in the July 2002 amendments to the SPCC rule (67 FR 47042,
July 17, 2002). ``Facility'' is defined as: ``any mobile or fixed,
onshore or offshore building, structure, installation, equipment, pipe,
or pipeline (other than a vessel or a public vessel) used in oil well
drilling operations, oil production, oil refining, oil storage, oil
gathering, oil processing, oil transfer, oil distribution, and waste

[[Page 58386]]

treatment, or in which oil is used, as described in Appendix A of this
part. The boundaries of a facility depend on several site-specific
factors, including, but not limited to, the ownership or operation of
buildings, structures, and equipment on the same site and the types of
activity at the site.'' ``Production facility'' is defined as ``all
structures (including but not limited to wells, platforms, or storage
facilities), piping (including but not limited to flowlines or
gathering lines), or equipment (including but not limited to workover
equipment, separation equipment, or auxiliary non-transportation-
related equipment) used in the production, extraction, recovery,
lifting, stabilization, separation or treating of oil, or associated
storage or measurement, and located in a single geographical oil or gas
field operated by a single operator.''
    Since the July 2002 amendments were published, members of the
regulated community have asked EPA which of these definitions governs
the term ``facility'' as it is used in the applicability determination
of the Facility Response Plan requirements under Sec.  112.20(f)(1)
when applied to an oil production facility. In May 2004, EPA issued a
Federal Register notice clarifying this issue (69 FR 29728, May 20,
2004). Specifically, section 112.20(f)(1) describes the applicability
of the Facility Response Plan (FRP) rule by setting the criteria for
determining whether a ``facility could, because of its location,
reasonably be expected to cause substantial harm to the environment * *
*'' [emphasis added]. Members of the regulated community were concerned
that the language in the definition of production facility (``located
in a single geographical oil or gas field'') would require aggregation
of oil production structures and equipment in such a way that would
trigger the applicability of the FRP rule. However, as stated in the
May 2004 Federal Register notice (69 FR 29728), because Sec. 
112.20(f)(1) consistently uses the term ``facility,'' not ``production
facility,'' it is the definition of ``facility'' in Sec.  112.2 that
governs who is subject to Sec.  112.20(f)(1), regardless of the
specific type of facility. Thus, consistent with the May 2004 notice,
the definition of ``facility'' governs the meaning of facility as it is
used in Sec.  112.20(f)(1), and accordingly, EPA is now proposing to
amend the definition of facility to add language clarifying this point.
    Industry sectors, including farms, military bases and other large
government facilities (e.g., national parks), airports, and
universities also have raised concerns over how to aggregate or
separate containers, buildings, structures, installations, equipment,
and piping for the purpose of SPCC applicability. Regulated community
members have expressed concern that non-contiguous oil-handling areas
with similar purposes or ownership are required to be aggregated
together as one ``facility'' to calculate total oil storage and
determine SPCC applicability. A farmer, for example, often has multiple
fuel storage sites on land under his management, which may include
owned and leased tracts. A USDA study shows that among farmers
surveyed, satellite fuel storage sites were an average distance of 4.1
miles from the main site (U.S. Department of Agriculture, ``Fuel/Oil
Storage and Delivery for Farmers and Cooperatives.'' March 2005).
    EPA believes that the existing definition of ``facility'' provides
considerable flexibility, and that the extent of a facility depends on
site-specific circumstances. The SPCC Guidance for Regional Inspectors
(version 1.0, November 28, 2005) describes factors that may be
considered relevant in delineating the boundaries of a facility for
SPCC purposes. Those factors may include, but are not limited to:
ownership, management, or operation of the containers, buildings,
structures, equipment, installations, pipes, or pipelines on the site;
similarity in functions, operational characteristics, and types of
activities occurring at the site; adjacency; or shared drainage
pathways. Consistent with this approach, EPA is proposing to amend the
definition of facility to clarify that contiguous or non-contiguous
buildings, properties, parcels, leases, structures, installations,
pipes, or pipelines may be considered separate facilities.
    For further clarity, EPA is also proposing to amend the definition
of ``production facility,'' as discussed in Section L of this notice.
1. Proposed Revisions to the Definition of Facility
    EPA is proposing to amend the definition of ``facility,'' as found
in Sec.  112.2, in three ways: To clarify that this definition alone
governs applicability of 40 CFR part 112; to clarify that contiguous or
non-contiguous buildings, properties, parcels, leases, structures,
installations, pipes, or pipelines may be considered separate facilities; 
and to add the qualifier ``oil'' before the term ``waste treatment.''
    To address concerns over whether the definition of ``facility'' or
the definition of ``production facility'' controls the term
``facility'' as it is used in Sec.  112.20(f)(1) when applied to an oil
production facility, EPA is proposing to add the following sentence to
the end of the definition of ``facility'': ``Only this definition
governs whether a facility is subject to this part.'' This language is
consistent with the clarification printed in a May 2004 Federal
Register notice (69 FR 29728). The definition of ``production
facility'' is used to determine which specific provisions of the rule
may apply at a particular facility (e.g., Sec.  112.9), in addition to
the administrative and general rule requirements.
    The Agency seeks comments on whether the proposed revision of the
definition of ``facility'' to clarify that this definition governs
applicability of part 112 is appropriate. Any suggestions for
alternative language to amend the definition must include an
appropriate rationale in order for the Agency to be able to consider it
for final action.
    To address concerns over how oil containers and equipment can be
separated or aggregated for the purposes of determining facility
boundaries and applicability of the SPCC requirements, EPA proposes to
insert the following sentence into the definition of facility:
``Contiguous or non-contiguous buildings, properties, parcels, leases,
structures, installations, pipes, or pipelines under the ownership or
operation of the same person may be considered separate facilities.''
EPA also proposes to add the terms ``property,'' ``parcel,'' and
``lease'' to the list of terms mentioned in the first sentence of the
definition. EPA believes that adding these terms further distinguishes
the attributes that can be considered in determining facility
boundaries. These terms are intended to be those that are familiar to a
regulated community member, such as a farmer or oil production facility
owner, and are not meant to be exhaustive. EPA notes that an owner or
operator may not determine his facility boundary in such a manner as to
simply avoid applicability of the SPCC rule.
    The Agency seeks comments on whether the proposed revision to the
definition of ``facility'' to clarify that contiguous or non-contiguous
buildings, properties, parcels, leases, structures, installations,
pipes, or pipelines may be considered separate facilities is
appropriate. Any suggestions for alternative language to amend the
definition must include an appropriate rationale in order for the
Agency to be able to consider it for final action.
    Finally, EPA is proposing to amend the first sentence of the
definition of facility to add the qualifier ``oil'' before the term
``waste treatment.'' With this

[[Page 58387]]

amendment, EPA is clarifying that the term ``waste treatment'' refers
to oil waste treatment and not to treatment of any other type of waste
that may be generated. The Agency seeks comments on whether this
proposed modification is appropriate.
2. Determining the Components of a Facility: Examples of Aggregation or
Separation
    The list of factors for determining the boundaries of a facility in
the definition of facility are not exclusive, but are merely examples.
The SPCC Guidance for Regional Inspectors (version 1.0, November 28,
2005) elaborates on what other factors may be considered. As noted
above, those factors may include, but are not limited to: ownership,
management, or operation of the containers, buildings, structures,
equipment, installations, pipes, or pipelines on the site; similarity
in functions, operational characteristics, and types of activities
occurring at the site; adjacency; or shared drainage pathways.
    EPA provides the following example scenarios of how a facility
owner or operator may determine what is considered a ``facility'' for
the purposes of an SPCC Plan. Each of these scenarios is purely
hypothetical and is not intended to provide a policy interpretation for
any specific existing facility.
a. Separation of Tracts at a Farm
    A farmer has one central fueling location and ten separate (either
contiguous or non-contiguous) tracts of land (inclusive of owned and
leased tracts) where various types of crops are grown. The central
fueling location has several oil containers, with an aggregate storage
capacity of 5,000 gallons of diesel fuel, gasoline, and hydraulic/
lubrication oils. Each tract has one 1,000-gallon aboveground container
of diesel fuel, used for fueling only the equipment operated on the
tract. The tracts are located such that the containers are each several
miles from each other. The tracts each produce various types of crops,
and thus the equipment is operated seasonally according to crop type
and irrigation needs.
    The farmer determines that, given the distance between containers,
and the clear distinction between the operations that they support,
each tract and the central fueling location can be considered a
separate facility for the purposes of calculating oil storage capacity
and determining the applicability of the SPCC rule. The fact that the
tracts may be contiguous would be only one factor in the facility
determination, and may allow the designation of the separate contiguous
tracts as separate facilities, given the great distance and operational
differences. In this example, each tract does not individually meet the
aboveground storage capacity threshold for applicability of the SPCC
rule (1,320 gallons). Therefore, no SPCC Plan is required for these
containers. However, the central fueling location exceeds the SPCC rule
aboveground storage capacity threshold. Assuming the farm is located
such that a discharge of oil could reasonably pose a threat to
navigable waters or adjoining shorelines, the farmer must prepare and
implement an SPCC Plan for the central fueling area.
    To provide general protection and prevention measures against an
oil discharge, the farmer has the option to include the oil containers
on the separate tracts in his Plan. Under Section 311(b)(3) of the
Clean Water Act, the farmer would still be liable for any harmful
quantities of oil discharged from the containers on the separate tracts
into navigable waters or adjoining shorelines, even if an SPCC Plan is
not required.
b. Separation of Parcels at an Oil Production Facility
    An oil production facility operator leases the right to extract oil
from three parcels of land separated by large distances within one oil
production field. The parcels can be contiguous or non-contiguous. Each
of the parcels is subject to a distinct lease agreement, consistent
with all applicable state and local oil and gas laws and regulations.
Each parcel contains a tank battery and a single or several wellheads.
The operator determines that, given their geographic separation and
individual lease agreements, each parcel can be considered a separate
facility. Each tank battery stores a total aboveground capacity of oil
greater than 1,320 gallons, so the operator prepares and implements a
separate SPCC Plan for each tank battery and its associated wellheads,
flowlines, and associated equipment, as individual facilities. Any
gathering lines that transport oil from these individual facilities
into a centralized collection area involve the transportation of oil
between facilities (``inter-facility'') and are therefore not within
EPA jurisdiction. These ``inter-facility'' gathering lines do not need
to be included in the SPCC Plans.
    Because the definition of facility is flexible, the operator could
alternatively choose to consider all three parcels as one facility,
based on his common ownership or operation of all of them. Under this
approach, the operator would only need to prepare one SPCC Plan that
covers the components of all parcels. Any gathering lines connecting
the tank batteries of each parcel are then considered ``intra-
facility'' gathering lines and must be included in the SPCC Plan (see
section L.2 of this preamble). It is also important to note that if an
owner/operator aggregates oil storage so as to develop one SPCC Plan,
he must then determine the facility boundaries the same way for the
purposes of applicability of the FRP rule requirements.
    Additionally, a production facility may consist of parcels that are
smaller or larger than an individual lease.
c. Aggregation of Equipment at an Oil Production Facility
    An oil production facility owner operates one wellhead. Oil is
treated in an 800-gallon capacity heater-treater to separate the oil
from produced water; the treated oil is then stored in several stock
tanks until it is sold and transported off-site. The heater-treater
separation equipment is located several feet away from the stock tanks,
which hold both the oil and produced water. These two areas may be
physically separate and are protected by separate secondary containment
berms, but the heater-treater is an integral component of an oil
production facility, connected by piping, and under the control of the
same operator. The separation equipment, such as a heater-treater, is a
component of a larger process that would be incomplete without the
ability to separate oil and produced water. Thus, all of these
components should be aggregated together to comprise the oil production
facility. In this circumstance, EPA does not believe the heater-treater
should be considered a separate facility.
    As another related example, an oil production facility owner
operates one wellhead connected to the tank battery by a mile-long
flowline. Despite the length of the flowline, the facility operator may
not have a reasonable basis for separating the wellhead, flowline, and
tank battery as distinct facilities with individual SPCC Plans. Similar
to the heater-treater, the wellhead and tank battery are considered
integral components of the larger process, and an oil production
facility would be incomplete without including these two components.
The flowline, whether several feet or several miles in length, is a
necessary connection between the wellhead and tank battery, and all of
these components must be included in one SPCC Plan.

[[Page 58388]]

    An SPCC Plan must include all of the components that together
comprise a complete facility. There may be no reasonable basis to
determine that either of the facilities in these examples could be
divided into separate, smaller facilities. While a facility owner or
operator has some discretion in describing the parameters of his
facility, he may not describe the boundaries of a facility unreasonably
in an attempt to avoid regulation. EPA also notes that if an owner/
operator aggregates oil storage so as to develop one SPCC Plan, he must
then determine the facility boundaries the same way for the purposes of
applicability of the FRP rule requirements.
d. Separation of Areas at a Military Base
    A military base is spread out over 10 square miles. Within the
base, there are several areas where oil containers are located: A tank
farm associated with an aircraft fueling area, back-up fuel oil for a
small power generation plant, and a mess hall with several drums of
cooking oil. Because different groups service, manage, or maintain the
various tank farms and oil storage areas, these operators have agreed
to calculate the aggregate storage capacity of each of their operations
separately to determine their SPCC rule applicability. The operations
vary across these oil container locations, each with unique or specific
characteristics. Thus, the operators have decided that oil spill
prevention practices would be served best by preparing and implementing
multiple SPCC Plans. If the military determines that it would be more
efficient to prepare one SPCC Plan for the entire base, this would also
be appropriate.
    The same principles apply at other large facilities, such as a
university or airport. While a facility owner or operator has some
discretion in describing the parameters of his facility, he may not
describe the boundaries of a facility unreasonably to avoid regulation.
If an owner/operator aggregates oil storage so as to develop one SPCC
Plan, he must then determine the facility boundaries the same way for
the purposes of FRP rule applicability.
e. Separation of Functions at a Dual-purpose Facility
    The owner of a truck maintenance company operates his business from
a site that also includes his single-family residence. The business
office is located in his residence. In an adjacent garage, he has one
500-gallon gasoline container, one 250-gallon waste oil container, and
five 55-gallon drums of various automotive lubricants. The entire
building is heated with one 500-gallon heating oil container. In
considering whether he is subject to the SPCC rule, this business owner
concluded that the heating oil container is exempt from the rule,
because it is associated with his home, and the function of heating his
home is necessary regardless of the presence of his business
operations. The total storage capacity of the remaining containers does
not meet the aboveground storage capacity threshold for applicability
of the SPCC rule (1,320 gallons) and so the owner does not need to
comply with the rule requirements.
3. Alternative Options Considered
    In developing the amendments proposed in this notice, EPA considered 
the following alternatives for addressing the definition of facility:
a. No Action
    EPA considered taking no regulatory action regarding this issue.
However, given the significant number of questions and concerns that
have been raised by the regulated community, EPA believes that
addressing the definition of facility in some manner is necessary.
Therefore, EPA chose not to propose this ``no action'' option.
b. Address Only Through Guidance
    EPA considered providing guidance to address the regulated
community's concern over the definition of facility and which
definition governs the term ``facility'' as it is used in Sec. 
112.20(f)(1) when applied to an oil production facility. EPA has
provided clarity already on the definition of facility in the SPCC
Guidance for Regional Inspectors (version 1.0, November 28, 2005) and
through a Federal Register Notice (69 FR 29728, May 25, 2004). Despite
these efforts, the regulated community continues to express concern.
EPA believes that a formal rule amendment will provide more clarity.
Therefore, EPA is not moving forward with the option to address this
rule solely through guidance. EPA does intend, however, to revise the
SPCC Guidance for Regional Inspectors to be consistent with any rule
amendment(s) finalized.
    The Agency welcomes comments on this or other alternatives that
could serve to address the needs of the regulated community, while at
the same time maintaining appropriate levels of environmental
protection. Any alternative approaches presented must include an
appropriate rationale in order for the Agency to be able to consider
them for final action.

E. Facility Diagram

    Section 112.7(a)(3) of the SPCC rule requires that a facility owner
or operator include in his SPCC Plan a facility diagram that identifies
the location and contents of oil containers, connecting piping, and
transfer stations. The diagram helps to ensure safe and efficient
response actions, effective spill prevention and emergency planning,
and proper implementation of the Plan by facility personnel. It also
assists the EPA inspector in reviewing the facility's SPCC Plan.
    The rule requires that the facility diagram include the location
and contents of each container, completely buried tanks (even if
exempted from the SPCC requirements), transfer areas (i.e., stations),
and connecting pipes. In addition to the requirement for a facility
description and diagram, Sec.  112.7(a)(3) lists additional items to be
addressed in an SPCC Plan, including the type of oil in each container
and its capacity; discharge prevention measures; discharge or drainage
controls; countermeasures for discharge discovery, response, and
cleanup; methods of disposal of recovered materials; and specific
contact information. The SPCC Guidance for Regional Inspectors (version
1.0, November 28, 2005) discusses the requirements for facility
diagrams in more detail.
    The facility diagram must include all containers (including oil-
filled equipment) that store 55 gallons or more of oil and must include
information indicating the contents of these containers (Sec. 
112.7(a)(3)). The minimum container size addressed by the SPCC rule is
55 gallons. Any containers with an oil storage capacity of less than 55
gallons do not need to be included in the SPCC Plan.
    Regulated community members have raised the concern that
documenting the contents of all oil storage containers with a capacity
of 55 gallons or more on a facility diagram would be impractical due to
seasonal and market changes. EPA acknowledges these concerns, and
proposes to add flexibility to this requirement.
1. Proposed Revision to the Facility Diagram Requirement
    EPA proposes to amend Sec.  112.7(a)(3) to clarify that the
facility diagram must include all fixed (i.e., not mobile or portable)
containers. For any mobile or portable containers located in a certain
area of the facility, a facility owner or operator must mark that area
on the diagram where such containers are stored. He may mark the number of

[[Page 58389]]

containers, contents and capacity of each container either on the
facility diagram, or provide a separate description in the SPCC Plan.
If the total number of mobile or portable containers changes on a
frequent basis, the owner or operator can indicate an estimate in the
Plan of the number of containers, the anticipated contents and
capacities of the mobile or portable containers maintained at the facility.
    Those oil storage containers that are located in a fixed position
(and do not move around the facility) must be represented on the
facility diagram, as currently required. In situations where diagrams
become complicated due to the presence of multiple oil storage
containers or complex piping/transfer areas at the facility, it may be
difficult to indicate the contents and capacity of the containers on
the diagram itself. In order to simplify the diagram, the owner or
operator may choose to include that information separately in the SPCC
Plan in an accompanying table or key.
    The proposed revision to the rule language would simplify the
process for developing a facility diagram by allowing for a general
description of the location and contents of mobile or portable oil
storage containers (e.g., drums and totes) rather than representing
each container individually. Under this proposal, the owner or operator
could identify an area on the facility diagram (e.g., a drum storage
area) and include a separate description of the total number of
containers, capacities, and contents in the Plan or reference facility
inventories that can be updated by facility personnel. As currently
required in Sec.  112.7(a)(3)(i), an owner or operator is required to
list all of the containers in the facility in the SPCC Plan. Under the
current proposal, EPA would modify Sec.  112.7(a)(3)(i) to allow the
owner or operator to provide an estimate of the potential number of
mobile or portable containers, types of oil, and anticipated capacities
in the Plan. This clarification may be particularly useful when the
number of containers change frequently at the facility. Thus, the Plan
should include a reasonable estimate of the number of containers
expected to be stored in the area and the capacity of the containers.
This estimate can be used to determine the applicability of the rule
thresholds and provide a general description of the mobile/portable
containers in the Plan.
    Mobile or portable containers should be marked on the facility
diagram in their out-of-service or designated storage area or where
they are most frequently located, such as a warehouse drum storage
area. The facility owner/operator or certifying PE may determine how
best to represent mobile/portable containers on the facility diagram,
such as by including a descriptive table or indicating primary storage
areas. A descriptive table or key would complement the facility diagram
and the SPCC Plan by providing further information on the location and
contents of mobile and portable containers.
    A mobile or portable oil storage container is still subject to the
sized secondary containment requirements of the SPCC rule. Sections
112.8(c)(11) and 112.12(c)(11) require that a mobile or portable oil
storage container (other than a mobile refueler) be positioned or
located to prevent a discharge as described in Sec.  112.1(b). The
mobile or portable container must have a secondary means of
containment, such as a dike or catchment basin, sufficient to contain
the capacity of the largest single compartment or container with
sufficient freeboard to contain precipitation. This area can be
identified on the facility diagram.
    A facility diagram prepared for a state or federal plan or for
other purposes (construction permits, facility modifications, or other
pollution prevention requirements) may be used in an SPCC Plan if it
meets the requirements of the SPCC rule. Additionally, changes to the
facility diagram are considered administrative in nature and do not
require PE certification.
    The Agency seeks comments on this proposed option or any other
approach to revising to the facility diagram requirement at Sec. 
112.7(a)(3) to address how mobile/portable containers should be marked
on a facility diagram. Any suggestions for alternative approaches must
include an appropriate rationale and supporting data in order for the
Agency to be able to consider it for a final action.
2. Indicating Complicated Areas of Piping or Oil-Filled Equipment on a
Facility Diagram
    A facility diagram must also include all transfer stations and
connecting pipes (Sec.  112.7(a)(3)). Associated piping and oil-filled
manufacturing equipment present at an SPCC-regulated facility may be
difficult to clearly present on a facility diagram, due to their
relative location, complexity, or design. EPA requests comment on
whether a rule revision is appropriate to provide further clarification
on how complicated areas of piping or oil-filled equipment may be
indicated on the facility diagram. As stated in the SPCC Guidance for
Regional Inspectors (version 1.0, November 28, 2005), EPA allows
flexibility in the way the facility diagram is drawn--an owner or
operator may represent such systems in a less detailed manner on the
facility diagram, as long as more detailed diagrams of the systems are
maintained at the facility and referenced on the diagram. As described
in the SPCC guidance document, the scale and level of detail shown on a
facility diagram may vary according to the needs and complexity of the
facility. For example, simplified schematic representations of piping
combined with a description in the Plan may be sufficient. Similar to
the approach described above for mobile/portable equipment, a facility
owner or operator may indicate in the diagram an area where complicated
oil-filled equipment is located and provide a table in the Plan
describing the type(s) of equipment and oil storage capacities.
    Any suggestions for alternative approaches must include an
appropriate rationale and supporting data in order for the Agency to be
able to consider it for final action.

F. Loading/Unloading Racks

    Tank car and tank truck loading/unloading racks are subject to
specific requirements in Sec.  112.7(h), including sized secondary
containment requirements. Although the term ``rack'' is referred to in
the title of the provision, the rule text refers to ``loading/unloading
area.'' In response to concerns expressed by the regulated community
over how broadly this provision applies (whether to all areas where oil
is loaded or unloaded, or only to areas with a designated loading or
unloading rack), the Agency in May 2004 issued a Federal Register
notice clarifying that the provision only applies at areas of a
regulated facility where a loading or unloading rack is located (69 FR
29728, May 25, 2004). If a facility does not have a loading or
unloading ``rack,'' Sec.  112.7(h) does not apply. To provide further
clarification, in the SPCC Guidance for Regional Inspectors (version
1.0, November 28, 2005), EPA provided a set of characteristics that
describe the type of equipment typically associated with a loading or
unloading rack. To provide additional clarity and certainty to the
regulated community, EPA is now proposing a definition for the term
``loading/unloading rack,'' which would govern whether a facility is
subject to Sec.  112.7(h). Under this proposal, the requirements
described at Sec.  112.7(h) would only apply to areas of a regulated
facility where a loading/unloading rack, as would be defined in Sec. 
112.2, is located.

[[Page 58390]]

    A loading/unloading rack can be located at any type of facility;
however, the loading and unloading areas associated with oil production
tank batteries and farms generally do not have the equipment meeting
the proposed definition of loading/unloading rack. Therefore, EPA is
proposing a specific exclusion for oil production facilities and farms
from the requirements at Sec.  112.7(h).
1. Proposed Loading/Unloading Rack Definition
    The proposed definition for ``loading/unloading rack'' is based on
the set of characteristics that generally describes loading/unloading
racks, as presented in the SPCC Guidance for Regional Inspectors
(version 1.0, November 28, 2005). In developing this description, EPA
considered existing definitions of the term ``loading rack'' or related
terms, as found in industry, Federal, state, or international
references. Based on this review, EPA is proposing to use the
definition (with certain changes) developed by the American Petroleum
Institute (API).\2\ Specifically, we removed language on frequency of
use, various components, and the limitation to the types of facilities
at which a rack could be located. EPA modified this definition in order
to accommodate racks found among the broader universe of facilities
subject to the SPCC rule. For this proposal, the guidelines presented
in the guidance document were modified to reflect additional research
on the equipment typically associated with racks and to remove several
ambiguous terms and phrases (See EPA's Analysis of Loading and
Unloading Rack Requirement (40 CFR part 112), August 31, 2007).
---------------------------------------------------------------------------

    \2\ American Petroleum Institute, October 18, 2002. Letter to
David Lopez, Director, EPA Oil Program Center.
---------------------------------------------------------------------------

    EPA is proposing the following definition for ``loading/unloading
rack'' under Sec.  112.2: ``Loading/unloading rack means a structure
necessary for loading or unloading a tank truck or tank car, which is
located at a facility subject to the requirements of this part. A
loading/unloading rack includes a platform, gangway, or loading/
unloading arm; and any combination of the following: piping
assemblages, valves, pumps, shut-off devices, overfill sensors, or
personnel safety devices.'' The Agency believes this proposed amendment
will provide clarity as to the applicability of the Sec.  112.7(h)
requirement by providing a specific definition for a loading/unloading
rack.
    In developing this proposed definition, EPA considered whether to
differentiate between ``loading'' and ``unloading'' racks. Generally,
loading involves oil transfer from a bulk storage container into the
tank car/truck, whereas unloading involves oil transfer from the tank
car/truck into a bulk storage container. Although racks are more
commonly used for loading activities, there are instances in which
unloading of oil also occurs at a rack, and, in some cases, using the
same equipment. The similarity of equipment and activities suggests
that EPA should not differentiate between loading and unloading racks
nor eliminate the term ``unloading rack'' altogether. This approach is
consistent with correspondence received from the regulated community on
this issue. For example, in an October 2003 letter to EPA, the American
Petroleum Institute (API) suggested a definition for rack that includes
both loading and unloading activities (see the docket for this proposed
rulemaking for the complete letter).
    EPA understands that a loading/unloading rack is typically designed
to meet the needs of an individual facility, and thus a single
definition that captures all potential variations of the components
presents a challenge. However, discussions with manufacturers of
loading/unloading racks suggest that there is some commonality among
the basic structural components of a typical ``rack.'' Thus, each of
the specific components listed in the proposed definition were included
because they are common characteristics of loading or unloading racks.
    Loading arms are an essential component of both top and bottom
loading. By including the generic term ``loading/unloading arms,'' EPA
intends the proposed definition to be applicable to all loading
approaches, including top, side, and bottom loading. The National
Institute of Standards and Technology (NIST) (Loading-Rack Meters
Presentations, Chapter 2: Introduction to Loading Rack Metering
Systems, Revised August 2000) indicates that loading racks are designed
to fill receiving tanks either from the top, side or bottom. Although
top loading is common, bottom loading is increasingly used to load/
unload tank cars and trucks.
    Platforms offer structural bases to a loading rack and are typical
of both top and bottom loading. Platforms are often found in
conjunction with additional components (e.g., gangways), whereas
bottom-loading operations that do not require access to the top of a
tank are sufficient with only a platform component.
    Gangways are primarily found on loading racks that accommodate top
loading operations. However, it is not uncommon for bottom loading
operations to include gangways to access the top of the rack structure
or receiving container during loading operations for the purposes of
sampling, testing overfill or other safety equipment, or for pressure
venting operations.
    Piping assemblages, valves, pumps, shut-off devices, overfill
sensors, and personnel safety devices are examples of typical
accessories of a loading/unloading rack, but may not be part of the
rack structure itself.
    The Agency seeks comment on the proposed definition of ``loading/
unloading rack'' or if there are any other definitions for ``loading/
unloading rack'' that would be more suitable.
    Comments providing a description of a ``loading/unloading arm'' may
also provide useful information for EPA to consider in determining a
final action. Any alternative definition presented must include an
appropriate rationale and supporting data in order for the Agency to be
able to consider it for final action.
2. Requirements for Loading/Unloading Racks
    Although the title of Sec.  112.7(h) refers to ``loading/unloading
rack,'' the text of the requirement refers to ``loading/unloading
areas.'' Therefore, to provide additional clarity, EPA proposes to
change all references from loading/unloading ``area'' to loading/
unloading ``rack.'' For example, Sec.  112.7(h)(1) would be modified as
follows: ``Where loading/unloading rack drainage does not flow into a
catchment basin or treatment facility designed to handle discharges,
use a quick drainage system for tank car or tank truck loading/
unloading racks. You must design any containment system to hold at
least the maximum capacity of any single compartment of a tank car or
tank truck loaded or unloaded at the facility.'' Section 112.7(h)(2)
would be similarly modified and includes a technical correction of the
word ``break'' to ``brake'' to correct a typographical error.
    The modification to change the word ``area'' to ``rack'' in Sec. 
112.7(h) is consistent with EPA's notice in the Federal Register in May
2004, which noted that the application of Sec.  112.7(h) only applies
to facilities with loading and unloading ``racks'' (69 FR 29728, May
25, 2004). EPA also clarified, in a letter to the Petroleum Marketers
Association of America, that loading and unloading activities that take
place beyond the rack area are not subject to

[[Page 58391]]

the requirements of Sec.  112.7(h), but are subject, where applicable,
to the general secondary containment requirements of Sec.  112.7(c)
(Letter to Daniel Gilligan, President, Petroleum Marketers Association
of America, from Marianne Lamont Horinko, Assistant Administrator,
Office of Solid Waste and Emergency Response, EPA, May 25, 2004).
    In the preamble to the July 2002 amendments to the SPCC rule, EPA
stated that Sec.  112.7(h) ``applies to containers which are
aboveground (including partially buried tanks, bunkered tanks, or
vaulted tanks) or completely buried (except those exempted by this
rule)'' (67 FR 47110, July 17, 2002). This means that Sec.  112.7(h)
does not apply to a loading/unloading rack associated with a container
that is exempted from the rule, such as an underground storage tank
(UST) that is subject to all of the technical requirements of 40 CFR
part 280 or a State program approved under part 281. EPA is
reconsidering this position, because a transfer to or from such a
container at an SPCC-regulated facility is a potential source of a
discharge of oil into navigable waters or adjoining shorelines.
Additionally, since a loading/unloading rack associated with the UST is
not typically part of the UST system, it is not subject to all of the
technical requirements of 40 CFR part 280 or 281, and is therefore
regulated under SPCC in the same manner as any other transfer equipment
or transfer activity located at an otherwise regulated SPCC facility.
    In the preamble to the December 2006 amendments, EPA noted that
although the amendment provided an exemption for motive power
containers, the oil transfer activities to or from motive power
containers occurring within an SPCC-regulated facility continue to be
regulated (71 FR 77283, December 26, 2006). Consistent with the
preamble to the December 2006 amendments, the Agency is clarifying that
at an SPCC-regulated facility, Sec.  112.7(h) (including the sized
secondary containment provision) applies to transfers at any loading/
unloading rack associated with any type of container, including one
that is exempted from the rule, as long as the loading/unloading rack
meets the definition proposed in this notice. A transfer not associated
with a loading or unloading rack is subject to the general secondary
containment provision at Sec.  112.7(c). The Agency believes that no
rule change is needed to clarify this point, because a rule amendment
to exempt a loading/unloading rack associated with a UST was never
proposed or finalized.
    The Agency seeks comments on the proposed modifications to the
provision at Sec.  112.7(h), and how EPA regulates the transfers to or
from completely buried tanks subject to all of the technical
requirements under 40 CFR part 280 or part 281, or if there are any
other modifications that would be more suitable. Any alternative
approach presented must include an appropriate rationale and supporting
data in order for the Agency to be able to consider it for final action.
3. Exclusions
    EPA is proposing to exclude onshore oil production facilities and
farms from the loading/unloading rack requirements at Sec.  112.7(h).
The provision currently excludes all offshore facilities. EPA
understands that there are extremely few, if any, loading/unloading
racks at oil production facilities. Similarly, EPA understands that
farm oil and fuel dispensing equipment is generally not associated with
loading/unloading racks. Oil transfer areas, such as loading/unloading
areas, at farms and oil production facilities that are subject to the
SPCC rule remain subject to the general secondary containment
requirements of Sec.  112.7(c).
    EPA understands that there may be other facilities or industry
sectors that are involved in the transfer of oil, but do not have a
structure that meets the definition of ``loading/unloading rack'' as
proposed in this notice. EPA is proposing to exclude onshore oil
production facilities and farms from Sec.  112.7(h), because the Agency
is specifically aware that these types of transfer equipment are not
typically associated with these types of facilities. EPA does not want
to create any confusion for owners/operators associated with oil
production facilities and farms, and for the purpose of clarity, is
exempting them. At other facilities that do not have a loading/
unloading rack, the provisions at Sec.  112.7(h) similarly do not
apply. As EPA stated in the SPCC Guidance for Regional Inspectors
(version 1.0, November 28, 2005), ``Areas where oil is transferred but
no loading or unloading rack is present are subject to Sec.  112.7(c),
and thus appropriate containment and/or diversionary structures are
required. EPA does not require specifically sized containment for
transfer areas; however, containment size must be based on good
engineering practice.''
    The Agency seeks comment on whether the proposed exclusion for
onshore oil production facilities and farms from the loading/unloading
rack requirements is necessary, or whether the proposed definition of
the term ``loading/unloading rack'' would provide sufficient clarity as
to the applicability of Sec.  112.7(h) at oil production facilities and
farms. Any suggestions for alternative approaches must include an
appropriate rationale and supporting data in order for the Agency to be
able to consider it for a final action.
4. Alternative Option Considered: No Action
    EPA considered not providing any amendments to the SPCC rule
related to loading/unloading racks. Under this approach, EPA would not
provide a regulatory definition for loading/unloading rack or an
exclusion for farms and oil production facilities, but would instead
continue to follow the interpretation of loading/unloading rack as
stated in the SPCC Guidance for Regional Inspectors and the May 2004
Federal Register notice. EPA chose not to move forward with this ``no
action'' option because it would not address the ambiguity of the
loading/unloading rack requirement as it currently stands.
    The Agency seeks comment on whether there are any other alternative
options that should be reviewed further by EPA prior to issuing a final
action. Any suggestions for alternative options must include an
appropriate rationale and supporting data in order for the Agency to be
able to consider it for a final action.

G. Tier I Qualified Facilities

    In December 2005 (70 FR 73524, December 12, 2005), EPA proposed to
allow the owner or operator of a qualified facility to self-certify his
SPCC Plan (this proposal was finalized in December 2006 at 71 FR
77266). In the preamble to this 2005 proposal, EPA discussed an
alternative option that was developed in response to comments EPA
received following publication of a Notice of Data Availability (NODA)
for facilities that handle oil below a certain threshold amount (69 FR
56182, September 20, 2004) and was based on an analysis submitted by
the Small Business Administration (SBA) Office of Advocacy. This
``multi-tiered approach'' was based on the total storage capacity of a
facility, as follows:
     Tier I would include facilities that have between 1,321
and 5,000 gallons of total oil storage capacity. These facilities would
not need a written SPCC Plan (and therefore no PE certification would
be needed), but would have to adhere to all other SPCC requirements.
     Tier II would include facilities having between 5,001 and
10,000 gallons of total oil storage capacity.

[[Page 58392]]

These facilities would be required to have a written SPCC Plan, but the
Plan would not need to be certified by a PE, and a PE site visit would
not be required. Standardized Plans could be adopted by a facility
conforming to standard design and operating procedures, without
requiring PE certification.
     Tier III would include the remaining SPCC-regulated
facilities with total oil storage capacities greater than 10,000
gallons. These facilities would be required to have a written SPCC Plan
certified by a PE.
    As described in its December 2006 final rule (71 FR 77266, December
26, 2006), EPA did not adopt this suggested multi-tiered structure
approach because the Agency believes that a facility cannot effectively
implement an oil spill prevention program, or any other program
(business or otherwise), without documentation of that program's action
items, such as in a written Plan. However, the Agency did finalize at
that time requirements for one ``tier'' of qualified facilities to
prepare a self-certified SPCC Plan. The Agency understands the concerns
of small businesses, particularly of facilities with a smaller oil
storage capacity and likely more limited resources, of the potential
effort needed to develop a full Plan. Thus, the Agency is now exploring
the possibility of further streamlining the SPCC requirements for
certain qualified facilities that meet additional criteria.
    EPA proposes to amend the SPCC rule to provide an additional option
for an owner or operator of a qualified facility with a maximum
individual oil storage container capacity of 5,000 U.S. gallons to
complete and implement a streamlined, self-certified SPCC Plan template
(proposed as Appendix G to 40 CFR part 112), in order to comply with
the requirements of the SPCC rule. A qualified facility is one that
meets the qualifying criteria described in the December 2006 amendments
to the SPCC rule (71 FR 77266, December 26, 2006): a facility that has
an aggregate aboveground oil storage capacity of 10,000 U.S. gallons or
less; and has had no single discharge as described in Sec.  112.1(b)
exceeding 1,000 U.S. gallons or no two discharges as described in Sec. 
112.1(b) each exceeding 42 U.S. gallons within any twelve-month period
in the three years prior to the SPCC Plan self-certification date, or
since becoming subject to 40 CFR part 112 if the facility has been in
operation for less than three years (this criterion does not include
discharges as described in Sec.  112.1(b) that are the result of
natural disasters, acts of war, or terrorism). For a more complete
discussion on these qualifying criteria, see the preamble to the
December 2006 SPCC rulemaking at 71 FR 77266.
    For clarity, EPA is now proposing the term ``Tier II qualified
facility'' to describe those qualified facilities as defined by and
subject to the requirements promulgated in the December 2006 SPCC
rulemaking at 71 FR 77266 and to propose the term ``Tier I qualified
facility'' for a new subset of these qualified facilities. EPA is
proposing that a Tier I qualified facility, in addition to meeting the
eligibility criteria for a Tier II qualified facility, also have no
individual oil storage containers with a capacity greater than 5,000
U.S. gallons in volume, as described below.
1. Eligibility Criteria
    As a subset of ``qualified facilities,'' Tier I qualified
facilities must meet all of the eligibility criteria finalized by EPA
in December 2006 (71 FR 77266), including reportable discharge history.
In the current action, EPA is proposing an additional criterion for
Tier I eligibility: a maximum individual oil storage container capacity
of 5,000 U.S. gallons.
    EPA has developed the proposed Tier I category based on an
operational characteristic, rather than a lower total facility storage
capacity threshold (as suggested by SBA), in order to link any
streamlined requirements with a reduced potential for oil discharge.
EPA proposes to set the maximum individual container capacity threshold
at 5,000 U.S. gallons because this volume is consistent with industry
consensus standards that call for varying levels of inspection
stringency based on container size and configuration. For example, the
Steel Tank Institute's SP001, Standard for the Inspection of
Aboveground Storage Tanks, allows for periodic visual inspection alone,
with no requirement for the inspector to be professionally certified,
for containers of 5,000 U.S. gallons or less that are equipped with a
spill control measure and a continuous release detection method.
Furthermore, a facility with smaller storage containers often has less
complicated operations, is typically an end-user of oil (does not
distribute the oil further), is involved in few oil transfers, and may
have predominantly mobile or portable containers with a few low-
capacity fixed oil storage containers. Smaller containers have a
smaller potential maximum discharge size, and there may be little or no
piping associated with these small containers.
    Determining the storage capacity for each oil storage container is
straightforward, so it should be relatively simple for a qualified
facility owner or operator to determine whether the facility meets this
criterion. An EPA inspector will be able to easily verify the storage
capacity for each container, and therefore confirm eligibility for Tier
I status as a qualified facility.
    This approach is similar to SBA's suggested Tier I eligibility
criterion of a 5,000-gallon aggregate facility storage capacity
threshold. However, by maintaining the higher facility capacity
threshold that applies for all qualified facilities (10,000 U.S.
gallons) and limiting the size of individual oil storage containers,
EPA proposes an option from which a greater number of facilities,
including those with a fluctuating oil storage capacity below 10,000
U.S. gallons, may benefit.
    To determine eligibility as either a Tier I or Tier II qualified
facility, only the aboveground oil storage capacity is considered.
However, a completely buried oil storage tank located at a qualified
facility is also regulated unless it is subject to all of the technical
requirements of 40 CFR part 280 or a State program approved under part
281. That is, if a facility is subject to the SPCC rule, then both
aboveground and completely buried oil storage containers located at the
facility are subject to the rule, unless specifically exempted from
applicability under Sec.  112.1(d).
    The Agency seeks comments on whether setting the criteria for Tier
I qualified facilities as a maximum individual oil container capacity
of 5,000 U.S. gallons appropriately addresses the concerns of
facilities with relatively smaller volumes of oil, while maintaining
the environmental protection intended by the regulation. Any
suggestions for alternative criteria, including alternate container
volume thresholds, must include an appropriate rationale and supporting
data in order for the Agency to be able to consider it for final action.
2. Provisions for Tier I Qualified Facilities
    In lieu of preparing a full SPCC Plan that is PE- or self-
certified, EPA proposes that an owner or operator of a Tier I qualified
facility would have the option to complete the SPCC Plan template
proposed as Appendix G of 40 CFR part 112. The Plan template is
designed to be a simple SPCC Plan that includes only the requirements
that should apply to this lowest tier of regulated facilities. This
proposed rule streamlines requirements for Tier I qualified facilities
by eliminating and/or modifying several SPCC requirements (e.g.,
facility diagram (Sec.  112.7(a)(3)) and

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certain provisions that generally do not apply to facilities that store
or handle smaller volumes of oil, such as requirements for transfers
taking place at loading racks (Sec.  112.7(h)).
    The list of applicable rule provisions for Tier I qualified
facilities is included as Sec.  112.6(a)(3) of this proposal. For an
owner or operator of a Tier I qualified facility completing the Plan
template included in Appendix G of this part, the following existing
requirements under Sec.  112.7 and in subparts B and C continue to
apply: facility description (Sec.  112.7(a)(3)(i), 112.7(a)(3)(iv),
112.7(a)(3)(vi), 112.7(a)(4), and 112.7(a)(5)); general secondary
containment (Sec.  112.7(c)); inspections, tests and records (Sec. 
112.7(e)); personnel, training, and discharge prevention procedures
(Sec.  112.7(f)); security (Sec.  112.7(g)); qualified oil-filled
operational equipment (Sec.  112.7(k)); facility drainage (Sec. Sec. 
112.8(b)(1), 112.8(b)(2), 112.12(b)(1), and 112.12(b)(2)); bulk storage
containers (Sec. Sec.  112.8(c)(1), 112.8(c)(3), 112.8(c)(4),
112.8(c)(5), 112.8(c)(6), 112.8(c)(10), 112.12(c)(1), 112.12(c)(3),
112.12(c)(4), 112.12(c)(5), 112.12(c)(6), and 112.12(c)(10)); piping
inspections (Sec. Sec.  112.8(d)(4) and 112.12(d)(4)); oil production
facility requirements(Sec.  112.9(b), 112.9(c), 112.9(d)(1),
112.9(d)(3), and 112.9(d)(4)); and requirements for onshore oil
drilling and workover facilities (Sec.  112.10(b), 112.10(c) and
112.10(d)). This list of requirements reflects a set of currently
existing requirements that apply to facilities subject to the SPCC
rule; EPA found no rationale to remove or modify these requirements for
Tier I qualified facilities. Additionally, as described below, EPA is
proposing a set of revised, or streamlined, requirements applicable to
Tier I qualified facilities in lieu of specific existing requirements.
a. Streamlined Provisions for Tier I Qualified Facilities
    EPA is proposing a set of revised requirements applicable to Tier I
qualified facilities in lieu of the specific existing requirements.
    In lieu of the full failure analysis requirements in Sec. 
112.7(b), EPA proposes that an owner or operator of a Tier I facility
examine areas where there is a reasonable possibility for equipment
failure (such as where equipment is loaded or unloaded; where tank
overflow, rupture, or leakage is possible; or at the location of any
other equipment known to be a source of discharge) and include in the
Plan the total quantity of oil that could be discharged and a
prediction of the direction of flow. This proposed amendment removes
the requirement for an owner or operator of a Tier I facility to
predict the rate of flow that could result from an equipment failure.
This modified requirement is proposed as Sec.  112.6(a)(3)(i). EPA
believes this is appropriate because Tier I facilities will have only
containers less than 5,000 gallons and, additionally, usually have low
pressure pumps. In order to simplify completion of the SPCC Plan
template, EPA is removing the requirement for an owner/operator to
calculate the rate of flow that could result from an equipment failure.
    Currently, secondary containment requirements for mobile/portable
containers and all other bulk storage container requirements are
provided in separate provisions: Sec. Sec.  112.8(c)(2) and (c)(11) and
112.12(c)(2) and (c)(11). In lieu of these separate requirements, EPA
proposes to (1) combine mobile/portable container requirements with the
other bulk storage container requirements, and (2) eliminate the
requirement for containment to be ``sufficiently impervious.'' This
modified requirement is proposed as Sec.  112.6(a)(3)(ii). Combining
these requirements streamlines two similar provisions and simplifies
requirements for Tier I qualified facilities. Because EPA expects a
Tier I qualified facility to be a small, simple operation, with oil
storage containers that are inside buildings, inside pre-engineered
secondary containment, or double-walled, the requirement for
containment to be specifically designed as ``sufficiently impervious''
may be unnecessary. Furthermore, the requirement for secondary
containment to be capable of containing oil and constructed so that any
discharge will not escape the containment system before cleanup occurs
(Sec.  112.7(c)) still applies, and is similar in nature to the
``sufficiently impervious'' requirement. For the purposes of
simplicity, EPA would rely on the requirement in Sec.  112.7(c) to
adequately address Tier I qualified facilities.
    In lieu of Sec. Sec.  112.8(c)(8) and 112.12(c)(8), the overfill
prevention requirements, EPA proposes to require that an owner or
operator of a Tier I qualified facility ensure each container is
provided with a system or documented procedure to prevent overfills of
containers, and that containers are regularly tested to ensure proper
operation or efficacy. This modification provides more flexibility by
allowing the use of alternative methods to prevent container overfills,
rather than requiring an owner or operator to meet a prescribed set of
overfill prevention procedures. This modified requirement is proposed
as Sec.  112.6(a)(3)(iii). EPA believes this proposed flexibility is
warranted, because overfills can be prevented on smaller containers if
tanks are manually gauged and the transfer is constantly attended. In
order to comply with this requirement, a Tier I qualified facility
owner or operator simply needs to provide a relatively brief
description of the overfill prevention procedures in the SPCC Plan. The
description needs to provide only sufficient detail that would allow an
EPA inspector to understand how the owner/operator prevents overfills
of oil storage containers and how liquid level sensing devices are tested.
    Elsewhere in this notice, EPA is proposing to extend the
streamlined security and integrity testing requirements that were
provided for qualified facilities in the December 2006 SPCC rule
amendment (71 FR 77266) to all facilities. Under this proposed
approach, both Tier I and Tier II qualified facilities would be subject
to the revised security (Sec.  112.7(g)) and integrity testing
(Sec. Sec.  112.8(c)(6) and 112.12(c)(6)) provisions.
b. Provisions Not Applicable to Tier I Qualified Facilities
    The following requirements are not included in the SPCC Plan
template because, for an end-use facility with a smaller oil storage
capacity and a simple configuration, these requirements are
inapplicable or unnecessary: facility diagram (Sec.  112.7(a)(3));
facility description (Sec.  112.7(a)(3)(ii), 112.7(a)(3)(iii)) and
112.7(a)(3)(v)); loading/unloading rack (Sec.  112.7(h)); brittle
fracture evaluation (Sec.  112.7(i)); facility drainage (Sec. Sec. 
112.8(b)(3), 112.8(b)(4), 112.8(b)(5), 112.12(b)(3), 112.12(b)(4), and
112.12(b)(5)); monitoring internal heating coils (Sec. Sec. 
112.8(c)(7) and 112.12(c)(7)), effluent treatment facilities
(Sec. Sec.  112.8(c)(9) and 112.12(c)(9)); and facility transfer
operations (Sec. Sec.  112.8(d)(1), 112.8(d)(2), 112.8(d)(3),
112.8(d)(5), 112.9(d)(2), 112.12(d)(1), 112.12(d)(2), 112.12(d)(3), and
112.12(d)(5)).
    Section 112.7(a)(3) Facility diagram. A qualified facility with no
individual container greater than 5,000 U.S. gallons in capacity is
typically small and generally simple in configuration. A facility
diagram is not needed to understand the facility layout and locate
areas of potential discharge at such facilities.
    Section 112.7(a)(3)(ii) Discuss discharge prevention measures
including routine handling of products (loading, unloading and facility

[[Page 58394]]

transfers). In order to simplify completion of the SPCC Plan template,
EPA proposes to remove the administrative provisions that require
discussion of oil handling at the facility. Smaller oil storage
capacity facilities tend to have fewer oil transfers, which are
generally conducted by an off-site oil distributor. Although the owner/
operator should be familiar with the routine oil-handling activities
and train employees on established procedures for oil handling, EPA
does not believe it is necessary to include a description of these
procedures in the SPCC Plan template.
    Section 112.7(a)(3)(iii) Discuss discharge or drainage controls
(e.g., secondary containment) and procedures. In order to simplify
completion of the SPCC Plan template, we have removed the requirement
to describe the facility drainage and secondary containment. Instead,
Section 2 of the Plan template includes a table for the owner or
operator to identify oil storage containers and the method of secondary
containment provided for each container. EPA believes this is
appropriate, considering the smaller volumes of oil stored or handled
at these facilities.
    Section 112.7(a)(3)(v) Discuss methods of disposal of recovered
materials. In order to simplify completion of the SPCC Plan template,
we have removed the requirement to discuss disposal methods for
recovered materials. However, the owner/operator is still obligated to
meet all local, state and Federal regulatory requirements for the
proper disposal of oil contaminated materials following an oil discharge.
    Section 112.7(h) Facility tank car and tank truck loading/unloading
rack. Elsewhere in this notice, EPA is proposing a definition for the
term ``loading/unloading rack.'' Given the Tier I qualified facility
eligibility criteria, a Tier I qualified facility would be unlikely to
have a loading/unloading rack, as proposed to be defined in Sec. 
112.2, because a Tier I qualified facility would not typically be
involved with oil distribution. Therefore, eliminating this requirement
is appropriate.
    Section 112.7(i) Brittle fracture evaluation. This requirement
applies to field-constructed, aboveground containers. Field-constructed
containers tend to be greater than 5,000 U.S. gallons in capacity;
under this proposal, a Tier I qualified facility would not have any
containers greater than 5,000 U.S. gallons in capacity. Therefore,
eliminating this requirement is appropriate.
    Sections 112.8(b)(3)-(b)(5) and 112.12(b)(3)-(b)(5) Facility
drainage requirements. A facility with a maximum individual container
storage capacity of 5,000 U.S. gallons is unlikely to have complicated
drainage systems. The purpose of drainage requirements listed in these
provisions is to provide further specification for when drainage
systems are used as secondary containment methods, and for how drainage
from diked containment areas should be accomplished. In a smaller
facility with less complicated operations, this additional
specification is not necessary.
    Sections 112.8(c)(7) and 112.12(c)(7) Requirements for monitoring
internal heating coils. A facility with smaller oil storage containers
is unlikely to have oil storage containers with heating coils due to
the type of operations conducted and the kind of oil commonly used at
such a facility. Therefore, eliminating this requirement is appropriate.
    Sections 112.8(c)(9) and 112.12(c)(9) Effluent treatment facility
inspections. A facility with smaller oil storage containers generally
does not maintain an effluent treatment system. Therefore, eliminating
this requirement is appropriate.
    Section 112.8(d)(1) and 112.12(d)(1) Corrosion protection for
buried piping. A facility with smaller oil storage containers generally
does not maintain extensive or complicated buried piping systems.
Therefore, eliminating this requirement is appropriate.
    Sections 112.8(d)(2) and 112.12(d)(2), and 112.8(d)(3) and
112.12(d)(3) Capping or blank-flanging terminal connections and design
of pipe supports. A facility with smaller oil storage containers
generally does not maintain extensive or complicated piping systems,
and piping is generally limited in length and adjacent to buildings or
associated equipment. Therefore, eliminating this requirement is
appropriate.
    Section 112.8(d)(5) and 112.12(d)(5) Warn vehicles of aboveground
piping. A facility with smaller oil storage containers generally does
not maintain extensive or complicated piping systems that may be
impacted by vehicles entering or leaving the facility. Furthermore,
piping is generally limited in length and adjacent to buildings or
associated equipment. Therefore, eliminating this requirement is 
appropriate.
    Section 112.9(d)(2) Inspect saltwater disposal facilities. EPA does
not expect there to be any saltwater disposal equipment generally
associated with an oil production facility that meets the criteria for
a Tier I qualified facility as described in this notice. Therefore,
eliminating this requirement is appropriate.
    EPA believes no further differentiation is warranted for onshore
oil production facilities in Sec.  112.9 and onshore oil drilling and
workover facilities in Sec.  112.10. An onshore oil production facility
that qualifies as a Tier I qualified facility will generally have the
same type of equipment as an oil production facility with larger oil
storage capacity (i.e., a wellhead with a pumpjack, flowlines, oil
separation equipment and oil storage and produced water containers) and
therefore, no further differentiation is warranted. An onshore drilling
or workover facility has three additional requirements under Sec. 
112.10. The facility must: position or locate mobile drilling or
workover equipment so as to prevent a discharge as described in Sec. 
112.1(b); provide catchment basins or diversion structures to intercept
and contain discharges of fuel, crude oil, or oily drilling fluids; and
install a blowout prevention (BOP) assembly and well control system
that is effective to control wellhead pressure. The presence of smaller
oil storage containers does not support differentiation of these
requirements, however, an onshore oil production, drilling or workover
facility that is eligible as a Tier I qualified facility will benefit
from the differentiated requirements under Sec.  112.7.
    EPA also believes that no further differentiation is warranted for
offshore drilling, production, and workover facilities subject to Sec. 
112.11. Due to the nature of operations associated with these types of
facilities, they are not likely to meet the criterion of a maximum
individual container capacity of 5,000 U.S. gallons.
    The Agency notes that under the existing SPCC requirements, the
Regional Administrator (RA), after reviewing a facility's Plan, has the
authority under Sec.  112.4 to require an owner or operator of a
facility to amend the SPCC Plan if the RA finds that an amendment is
necessary to prevent and contain discharges from the facility. Such an
amendment may include requiring PE certification in accordance with
Sec.  112.3(d). Under this proposal, this provision would also apply to
Tier I qualified facilities. An RA could, if warranted, require a Tier
I qualified facility to prepare a full (i.e., not using the template)
SPCC Plan with PE certification.
    The Agency also notes that use of the Plan template approach would
be optional. Under this proposed rule, an owner or operator of a Tier I
qualified

[[Page 58395]]

facility could choose to prepare and implement either a full PE-
certified SPCC Plan or a self-certified SPCC Plan according to all of
the requirements of Sec.  112.6(b) in order to comply with the
requirements under 40 CFR part 112. In other words, if a Tier I
qualified facility owner/operator chooses not to use the Plan template
in Appendix G, he would then be required to comply with the Tier II
qualified facility requirements in Sec.  112.6(b). Any owner or
operator of a qualified facility may also choose to prepare a full PE-
certified Plan instead of a self-certified one.
    The Agency believes that proposing a simpler, less costly
compliance option for these smaller, less complex facilities will
improve overall compliance with the SPCC regulation resulting in
enhanced environmental protection. EPA seeks comments on whether the
proposed streamlined set of rule provisions for Tier I qualified
facilities addresses the concerns of owners and operators of facilities
with relatively smaller volumes of oil and simpler configurations,
while maintaining the environmental protection intended by the
regulation. Any suggestions for alternative approaches and whether
additional provisions should be included or excluded from the template
must include an appropriate rationale and supporting data in order for
the Agency to be able to consider it for final action.
3. SPCC Plan Template
    The proposed SPCC Plan template for Tier I qualified facilities is
found at Appendix G in this proposed rule. To facilitate the
development of SPCC Plans at Tier I qualified facilities, EPA would
also make the Plan template available on its Web site, http://
www.epa.gov/emergencies. Once completed and certified by the owner or
operator, the Plan template would serve as the SPCC Plan for the
facility. As for any facility subject to the SPCC rule, the owner or
operator must maintain a written copy of the Plan--which in this case
would be the completed and certified SPCC Plan template--at the
facility or at the nearest field office if the facility is attended
less than four hours per day (Sec.  112.3(e)).
a. SPCC Plan Template Format
    The proposed template in Appendix G consists of a simple form,
where the facility owner/operator can confirm that that the facility
meets the rule requirements by marking the appropriate checkboxes. In
other sections, the owner or operator would enter the relevant
information in a summary table, or describe the equipment or procedures
implemented at the facility to meet the requirements. Specifically,
detailed descriptions would be provided for: (1) The inspection/testing
program used for all aboveground storage containers and piping; (2)
security measures (except for oil production facilities); (3) immediate
actions to be taken in the event of a reportable discharge (i.e., a
discharge to navigable waters or adjoining shorelines); (4) procedures
for preventing overfills from each oil storage container; and (5) the
flowline/intra-facility gathering line maintenance program (for oil
production facilities).
    The proposed template also includes attachments with various tables
that the owner or operator may use to record compliance activities,
such as periodic Plan reviews, equipment inspections, personnel
training, and discharge notifications. Records of inspections and tests
kept under usual and customary business practices also would suffice.
An owner or operator may insert additional pages to his Plan to provide
more detailed descriptions of equipment or procedures than allowed in
the space provided in the template, and provide the appropriate
reference in the relevant template field.
    At a minimum, an owner or operator would be required to fill out
all applicable portions of the Plan template. EPA would expect an owner
or operator to complete all fields in the general portion of the
template (Sections I and II, and III.1 through III.8), and the specific
portion of the template that applies to their facility type (A, B, or C
of Section III).
    The first part of the proposed Plan template contains summary
information about the facility. Section I contains the self-
certification statement that must be signed by the owner or operator.
By signing this statement, the facility owner or operator preparing the
Plan would commit to implementing the measures described in the Plan.
In Section II, the owner or operator acknowledges the requirements to
review and amend the Plan, and Plan reviews and amendments can be
recorded in Attachment 2 to the Plan template. Section III consists of
the requirements that apply to all facility types and include, in
order: (1) Oil Storage Containers; (2) Secondary Containment and Oil
Spill Control; (3) Inspections, Testing, Recordkeeping, and Personnel
Training; (4) Security (excluding oil production facilities); (5)
Emergency Procedures and Notifications; (6) Contact List; (7) NRC
Notification Procedure; and (8) SPCC Spill Reporting Requirements.
    The owner or operator must also complete one of the Sections
labeled A through C, according to the type of facility, as follows:
Section A in the case of an onshore facility (excluding production)
such as a farm; Section B in the case of an onshore oil production
facility; and Section C in the case of an onshore oil drilling and
workover facility. The Agency did not include requirements for offshore
oil drilling, production or workover facilities in the template because
EPA is not aware of any offshore drilling, production or workover
facility that would meet the Tier I qualification criteria.
    EPA believes that this simplified approach to developing an SPCC
Plan for Tier I qualified facilities is responsive to the concerns
expressed by small businesses and the SBA Office of Advocacy, and is
consistent with the characteristics of these facilities having a
limited number of oil storage containers, smaller overall oil storage
capacities, simple configurations, fewer oil transfers, and often have
no further distribution of oil.
    The Agency seeks comments on whether the proposed SPCC Plan
template in Appendix G for Tier I qualified facilities addresses the
concerns of owners and operators of facilities with relatively smaller
volumes of oil, while maintaining the environmental protection intended
by the regulation. The Agency also seeks comments on the clarity and
ease-of-use of the Plan template.
b. Environmental Equivalence and Impracticability Determinations
    Use of the Appendix G template would be limited to those facilities
that do not use environmentally equivalent measures under Sec. 
112.7(a)(2) and that do not determine secondary containment to be
impracticable as per Sec.  112.7(d). An owner or operator of a Tier I
qualified facility who wants to use such deviations may choose to
prepare and implement a self-certified Plan in accordance with the Tier
II qualified facility requirements in Sec.  112.6(b) and can then have
a licensed PE review and certify those portions of the SPCC Plan that
provide for alternate measures to be implemented at the facility.
However, these facilities would not be able to use the template in
Appendix G to comply with the SPCC rule because Tier II facilities have
additional SPCC requirements that are not included in the Plan
template. Tier I qualified facilities may also choose to prepare and
implement a PE-certified Plan in accordance with the full set of
applicable requirements in Sec.  112.7 and subparts B and C of the rule.

[[Page 58396]]

4. Self-Certification and Plan Amendments
    The elements of the Tier I self-certification requirement currently
being proposed are similar in scope to those required for an owner or
operator of a qualified facility who chooses to self-certify a Plan (as
promulgated in December 2006, 71 FR 77266). An owner or operator of a
Tier I qualified facility who chooses to complete an Appendix G
template Plan would be required to certify that: (1) He is familiar
with the applicable requirements of the SPCC rule; (2) he has visited
and examined the facility; (3) the Plan has been prepared in accordance
with accepted and sound industry practices and standards; (4)
procedures for required inspections and testing have been established
in accordance with industry inspection and testing standards and
recommended practices; (5) the Plan is being fully implemented; (6) the
facility meets the qualification criteria set forth under Sec. 
112.3(g)(1); (7) the Plan does not utilize the environmental
equivalence or impracticability provisions under Sec.  112.7(a)(2) and
112.7(d); and (8) the Plan and the individual(s) responsible for
implementing the Plan have the full approval of management and the
facility owner or operator has committed the necessary resources to
fully implement the Plan.
    The template also includes a section that acknowledges the owner/
operators' obligation to report oil discharges; review and amend the
SPCC Plan; prepare an oil spill contingency plan and provide a written
commitment of resources for qualified oil-filled operational equipment
(in lieu of secondary containment) or for flowlines and intra-facility
gathering lines at oil production facilities; implement the Plan; and
certify that the information in the Plan is true.
    Under Sec.  112.5 of the SPCC rule, an owner or operator must
review and amend the SPCC Plan following any change in facility design,
construction, operation, or maintenance that materially affects its
potential for a discharge as described in Sec.  112.1(b). Consistent
with the current requirement for qualified facilities, the owner or
operator of a Tier I qualified facility would be allowed to self-
certify any of these technical amendments to the Plan under Sec. 
112.6(a)(2), and document this certification in the Plan template.
    If the owner or operator of a Tier I qualified facility makes
changes to the facility such that the maximum individual oil storage
container capacity is greater than 5,000 U.S. gallons, the facility no
longer qualifies as a Tier I facility and is not eligible to implement
the self-certified SPCC Plan template. The facility owner or operator
must determine whether the facility still meets the eligibility
criteria for a Tier II qualified facility (i.e., total aboveground
storage capacity remains below 10,000 gallons). If the facility meets
the Tier II qualified facility criteria, the owner/operator would be
required to, within six months following the change in the facility,
prepare and implement a Plan in accordance with the proposed Sec. 
112.6(b) or prepare and implement a Plan in accordance with the general
Plan requirements in Sec.  112.7, and the applicable requirements in
subparts B and C, including having the Plan certified by a PE, as
required under Sec.  112.3(d). If, on the other hand, the facility is
no longer a qualified facility, the owner/operator would be required
to, within six months following the change in the facility, prepare and
implement a Plan in accordance with the general Plan requirements in
Sec.  112.7, and applicable requirements in subparts B and C.
    The Agency seeks comments on the appropriateness of these self-
certification elements and Plan amendment requirements, and on whether
there are other requirements that should be included. Any suggestions
for differentiation for the template must include an appropriate
rationale and supporting data in order for the Agency to be able to
consider it for a final action.
5. Tier II Qualified Facility Requirements
    EPA proposes to designate qualified facilities that do not meet the
additional criterion for Tier I qualified facilities (i.e., no
individual oil storage container with a capacity greater than 5,000
U.S. gallons) as Tier II qualified facilities. Although EPA is
proposing changes to the organization of the regulatory text in Sec. 
112.6 in order to accommodate the tiered approach, the requirements for
Tier II qualified facilities remain the same as they were finalized in
December 2006 (71 FR 77266). Tier II qualified facilities may choose to
comply with the requirements in proposed Sec.  112.6(b) by completing
and implementing a self-certified SPCC Plan, in lieu of having a PE-
certified Plan. The self-certified SPCC Plan must comply with all of
the applicable requirements of section Sec.  112.7 and subparts B and C
of the rule. The following table illustrates the tiers, criteria and
options for qualified facilities and all others as described in this
notice:

------------------------------------------------------------------------
               Qualified facilities
--------------------------------------------------- All other facilities
           Tier I                    Tier II
------------------------------------------------------------------------
If the facility has 10,000    If the facility has   If the facility has
 gallons or less in            10,000 gallons or     greater than 10,000
 aggregate aboveground oil     less in aggregate     gallons in
 storage capacity; and         aboveground oil       aggregate
                               storage capacity;     aboveground oil
                               and                   storage capacity,
                                                     or
If the facility has not had   If the facility has   If the facility has
 (1) a single discharge of     not had (1) a         had (1) a single
 oil to navigable waters       single discharge of   discharge of oil to
 exceeding 1,000 U.S.          oil to navigable      navigable waters
 gallons, or (2) two           waters exceeding      exceeding 1,000
 discharges of oil to          1,000 U.S. gallons,   U.S. gallons, or
 navigable waters each         or (2) two            (2) two discharges
 exceeding 42 U.S. gallons     discharges of oil     of oil to navigable
 within any twelve-month       to navigable waters   waters each
 period, in the three years    each exceeding 42     exceeding 42 U.S.
 prior to the SPCC Plan        U.S. gallons within   gallons within any
 certification date, or        any twelve-month      twelve-month
 since becoming subject to     period, in the        period, in the
 the SPCC rule if facility     three years prior     three years prior
 has been in operation for     to the SPCC Plan      to the SPCC Plan
 less than three years; and    certification date,   certification date,
                               or since becoming     or since becoming
                               subject to the SPCC   subject to the SPCC
                               rule if facility      rule if facility
                               has been in           has been in
                               operation for less    operation for less
                               than three years;     than three years;
                                                     or
If the facility has no                              If the owner/
 individual oil containers                           operator is
 greater than 5,000 gallons;                         eligible for
                                                     qualified facility
                                                     status, but decides
                                                     not to take the
                                                     option;

[[Page 58397]]

Then: The facility may        Then: The facility    Then: The facility
 complete and self-certify     may prepare a self-   must prepare a PE-
 an SPCC Plan template         certified SPCC Plan   certified SPCC Plan
 (proposed as Appendix G to    in accordance with    in accordance with
 40 CFR part 112) in lieu of   all of the            all of the
 a full SPCC Plan reviewed     applicable            applicable
 and certified by a            requirements of       requirements of
 Professional Engineer (PE)    Sec.   112.7 and      Sec.   112.7 and
                               subparts B and C of   subparts B and C.
                               the rule, instead
                               of one reviewed and
                               certified by a
                               Professional
                               Engineer (PE)
------------------------------------------------------------------------

    It is important to note that Tier II qualified facilities would not
be able to use the Appendix G template because it does not include all
of the SPCC requirements that may apply for these facilities.
    EPA is also proposing to remove the streamlined security and
integrity testing requirements for qualified facilities. Under this
proposal, the flexibility already available for qualified facilities
would be extended to all facilities, so these requirements would be
redundant.
6. Alternative Options Considered
    In developing the amendments proposed in this notice, EPA
considered the following alternatives for streamlining requirements for
a subset of qualified facilities:
a. Exemption From SPCC Regulation
    Under this option, EPA would exempt a certain subset of qualified
facilities from the SPCC requirements altogether, based on a lower
facility storage capacity threshold (e.g., 5,000 U.S. gallons). The
exemption of Tier I qualified facilities from the SPCC regulation would
significantly reduce the number of facilities subject to the SPCC
requirements. This regulatory alternative would also simplify the
applicability of the rule for qualified facilities. However, there is
no rationale or basis for exempting Tier I qualified facilities
completely from the SPCC rule. Furthermore, there are no data to
support setting a facility capacity threshold lower than the current
10,000-gallon capacity threshold for qualified facilities.
b. Tier I Eligibility Criteria Based on Total Facility Storage Capacity
    Under this option, EPA would determine the eligibility for Tier I
qualified facilities by establishing a lower facility storage capacity
threshold, such as 5,000 U.S. gallons. This action mirrors SBA's
approach in its multi-tiered structure proposal (submitted as a public
comment in response to the 2005 SPCC notice of proposed rulemaking,
OPA-2005-0001-0120). One advantage of this option is its simplicity,
since a facility owner or operator--once he determines that the
facility is ``qualified'' according to the criteria promulgated in
December 2006--would need only to consider the aggregate storage
capacity to determine if the Tier I option is available.
    However, there are no data to support setting a total facility
capacity threshold for a subset of qualified facilities to establish a
lower tier of differentiated requirements. Furthermore, no strong
rationale exists to support some areas for differentiation in the
template, based on a 5,000-gallon total facility storage capacity
threshold alone. EPA's preferred option ties the container capacity
threshold to existing differentiation in the STI SP001 standard for
container inspections. Additionally, a lower tier at the 5,000-gallon
threshold capacity may complicate applicability of the relief for
facilities with fluctuating oil storage capacity.
    The Agency seeks comments on these alternative options. Any
suggestions for additional alternatives must include an appropriate
rationale and supporting data in order for the Agency to be able to
consider it for final action.

H. General Secondary Containment

    At a facility subject to the SPCC rule, all areas with the
potential for a discharge as described in Sec.  112.1(b) are subject to
the general secondary containment provision, Sec.  112.7(c). These
areas may have loading/unloading areas (also referred to as transfer
areas), piping, and/or mobile refuelers, and may include other areas of
a facility where oil is present. The general secondary containment
requirement requires that these areas be designed with appropriate
containment and/or diversionary structures to prevent a discharge of
oil in quantities that may be harmful (i.e., as described in 40 CFR
part 110 into or upon navigable waters of the United States or
adjoining shorelines; see Sec.  112.1(b)). EPA clarified in the SPCC
Guidance for Regional Inspectors (version 1.0, November 28, 2005) that
``appropriate containment'' should be designed to address the most
likely discharge from the primary containment system, such that the
discharge will not escape containment before cleanup occurs. With this
proposed revision, EPA seeks to provide clarity consistent with the
explanation found in the guidance document regarding the method,
design, and capacity of secondary containment as required under Sec. 
112.7(c).
    Furthermore, Sec.  112.7(c)(1) and (2) list several example methods
for providing secondary containment. These methods are examples only;
other containment methods may be used, consistent with good engineering
practice. To provide clarity for the regulated community, EPA is
proposing to expand the list of examples of secondary containment
methods for onshore facilities. By expanding this list of examples, EPA
intends to include some additional prevention systems commonly used at
facilities.
1. Proposed Revisions to the General Secondary Containment Requirement
a. Containment Method, Design, and Capacity
    EPA proposes to clarify the general secondary containment
requirement at Sec.  112.7(c) by adding the text ``In determining the
method, design, and capacity for secondary containment, you need only
to address the typical failure mode, and the most likely quantity of
oil that would be discharged. Secondary containment may be either
active or passive in design.''
    In the SPCC rule, the general secondary containment provision is
complemented by various specific secondary containment requirements
(e.g., Sec. Sec.  112.7(h)(1), 112.8(c)(2), 112.8(c)(11), 112.9(c)(2),
112.12(c)(2), 112.12(c)(11)) which address the potential for oil
discharges from specific parts of a facility where oil is stored or
handled, such as at a bulk storage container or a loading/unloading
rack. These specific secondary containment requirements address the
design, sizing and freeboard capacity to account for a major container
failure. In contrast, the general secondary containment provision is
intended to address the most likely oil discharge from any part of a
facility. Therefore, in determining how to provide appropriate general

[[Page 58398]]

secondary containment, a facility owner or operator would consider the
typical failure mode and most likely quantity of oil that would be
discharged. Based on these site-specific conditions, the owner or
operator can determine what capacity of secondary containment is
needed, and design the containment method accordingly. The most likely
quantity of oil discharged is not often expected to be the maximum
capacity of the container.
    For example, at a regulated transfer area where a truck loads fuel
into an oil tank, the owner or operator may determine that the
reasonably expected source and cause of a discharge would be a ruptured
hose connection, and that a shutoff valve is present and accessible to
the attendant. To determine the most likely quantity of oil that would
be discharged, the oil's rate of flow and the amount of time it would
take for the attendant to close the valve need to be considered, in
accordance with good engineering practice. Depending on the likely
quantity of oil that would be discharged, the owner/operator may
determine that the appropriate method of secondary containment is a
passive containment measure, such as curbing around the area, or, if
the likely quantity of oil is reasonably handled by spill kits, then
such an active method of containment may be used.
    Under this proposal, EPA would further amend Sec.  112.7(c) to make
it clear that the requirement allows for the use of both active and
passive secondary containment measures to prevent a discharge to
navigable waters or adjoining shorelines. Active containment measures
are those that require deployment or other specific action by the
operator. These measures may be deployed either before an activity
involving the handling of oil starts, or in reaction to a discharge, so
long as the active measure is designed to prevent an oil discharge from
reaching navigable waters or adjoining shorelines. Active measures are
also referred to as spill countermeasures. In contrast, passive
measures are installations that do not require deployment or action by
the operator.
    The SPCC Guidance for Regional Inspectors (Version 1.0, November
28, 2005) provides several examples of the use of active measures at an
SPCC-regulated facility. The efficacy of active containment measures to
prevent a discharge depends on their technical effectiveness (e.g.,
mode of operation, absorption rate), placement and quantity, and timely
deployment prior to or following a discharge. For discharges that occur
only during attended activities, such as those occurring during
transfers, an active measure (e.g., sock, mat, or other portable
barrier, or land-based response capability) may be appropriate,
provided that the measure is capable of containing the oil discharge
volume and rate, and is timely and properly constructed/deployed.
    The general secondary containment approach implemented at a
facility need not be ``one size fits all.'' Different approaches may be
taken for the same activity at a given facility, depending on the
material and location. For example, the SPCC Plan may specify that
drain covers and sorbent material be pre-deployed prior to transfers of
low viscosity oils in certain areas of a facility located in close
proximity to navigable waters/adjoining shorelines or drainage
structures. For other areas and/or other products (e.g., highly viscous
oils), the Plan may specify that sufficient spill response capability
is available for use in the event of a discharge, so long as personnel
and equipment are available at the facility and these measures can be
effectively implemented in a timely manner to prevent oil from reaching
navigable waters and adjoining shorelines.
    Whatever method is used, the owner or operator must document in the
SPCC Plan the rationale for each containment method (i.e., how the use
of the measure is appropriate to the situation). The SPCC Plan must
also describe the procedures to be used to deploy any active measures
and explain the methods for discharge discovery that will be used to
determine when deployment of the active measure is appropriate (Sec. 
112.7(a)(3)(iii)).
    EPA requests comments on the appropriateness of the proposed
language for the general secondary containment provision to provide
clarity regarding the method, design, and capacity of secondary
containment as required under Sec.  112.7(c), consistent with current
Agency guidance. Any suggestions for alternative approaches must
include an appropriate rationale in order for the Agency to be able to
consider it for final action.
b. List of Secondary Containment Methods for Onshore Facilities
    EPA also proposes to amend the general secondary containment
provision at Sec.  112.7(c)(1) to include the following additional
example prevention systems for onshore facilities: Drip pans, sumps,
and collection systems. Drip pans are typically used to isolate and
contain small drips or leaks until the source of the leak is repaired.
They are commonly used with product dispensing containers (such as
drums), uncoupling of hoses during bulk transfer operations, and for
pumps, valves, and fittings. Sumps and collection systems generally
involve a permanent pit or reservoir and the troughs/trenches connected
to it that collect oil.
    By expanding the list of example secondary containment methods
found in Sec.  112.7(c)(1), EPA intends to increase the clarity and
better represent current prevention practices. EPA emphasizes that the
list of prevention systems are examples only; other containment methods
may be used, consistent with good engineering practice.
    EPA requests comments on the appropriateness of amending the
general secondary containment provision to expand the list of example
secondary containment methods found in Sec.  112.7(c)(1). Any
suggestions for alternative approaches must include an appropriate
rationale in order for the Agency to be able to consider it for final
action.
2. Alternative Option Considered: No Action
    EPA considered taking no regulatory action regarding this issue.
The current regulatory language currently allows for the facility
owner/operator to design secondary containment based on a typical
failure mode and likely quantity discharged. However, EPA believes that
modifying the general secondary containment language at Sec.  112.7(c)
is appropriate to more clearly illustrate the flexibility already
contained in the rule, as described in the guidance document.
3. General Secondary Containment for Non-Transportation-Related Tank Trucks
    In the December 2006 amendments to the SPCC rule (71 FR 77266,
December 26, 2006), EPA exempted mobile refuelers from the sized
secondary containment requirements applicable to bulk storage
containers. In the amended regulation, EPA defined a mobile refueler as
``a bulk storage container onboard a vehicle or towed, that is designed
or used solely to store and transport fuel for transfer into or from an
aircraft, motor vehicle, locomotive, vessel, ground service equipment,
or other oil storage container.'' (See Sec.  112.2). EPA recognizes
that non-transportation-related tanker trucks may operate similarly to
mobile refuelers, though not specifically transferring fuel. Therefore,
they may have the same difficulty in complying with the sized secondary
containment requirements. EPA requests comment on whether the
regulatory relief provided to mobile refuelers in 2006 (i.e., an exemption

[[Page 58399]]

from the sized secondary containment requirements) should be extended
to non-transportation-related tank trucks at a facility subject to the
SPCC rule. Such tank trucks include those used to store for short
periods of time and transport fuel, crude oil, condensate, non-
petroleum, or other oils for transfer to or from bulk storage
containers, e.g., a truck used to refill oil-filled equipment at an
electrical substation or a pump truck at an oil production facility.
Under this approach, the general secondary containment requirements at
Sec.  112.7(c) would still apply. This approach is also consistent with
the general secondary containment requirements that are already
applicable at the SPCC facility that the tank truck is visiting, and
would simplify compliance for the facility. However, this exemption to
sized secondary containment would not apply to a vehicle used primarily
for the bulk storage of oil in a stationary location, in place of a
fixed oil storage container.

I. Security

    In December 2005 (70 FR 73524, December 12, 2005), EPA proposed to
allow the owner and operator of a qualified facility to comply with a
set of streamlined facility security requirements (finalized in
December 2006 at 71 FR 77266). In the preamble to that proposal, EPA
recognized that there is no one single approach to ensure proper
facility security. For example, the security requirements for fencing
and lighting may not always be appropriate for sites such as a
national, state, or local park subject to the SPCC requirements, where
the site layout may be too extensive to fence, and where the lighting
of a solitary container would invite, rather than deter, would-be
intruders. EPA has received comments from the regulated community
suggesting that the security requirements should be revised for all
regulated facilities, for reasons consistent with those for a qualified
facility. EPA agrees that, even for a facility that is not a qualified
facility, it may not be appropriate to provide fencing around the
entire perimeter, and that lighting requirements in remote areas may
attract, rather than deter, vandals. Additionally, many oil storage
sites at farms, parks, and similarly isolated facilities have no
electricity, which makes compliance with the lighting requirement
difficult. In other cases, oil storage sites, such as those at farms,
may be located where an owner or operator is present around the clock.
Furthermore, due to the increased focus on security requirements by the
Department of Homeland Security (DHS) and other regulatory agencies to
which a facility subject to the SPCC rule may also be subject, EPA
believes that it is important to provide flexibility in complying with
the security requirements to allow an owner/operator of a facility to
customize a security program. By revising the facility security
requirements to make them more performance-based, EPA expects to
improve compliance rates, thereby enhancing environmental protection.
1. Proposed Revisions to the Security Requirements
    The application of the SPCC security measures is often determined
by the facility's geographical/spatial factors and there is no ``one-
size-fits-all'' answer to this requirement. Therefore, EPA is proposing
to modify the security requirements at Sec.  112.7(g) to make them
consistent with the streamlined, performance-based requirements
currently found at Sec.  112.6(c)(3)(ii) for qualified facilities.
Because the proposed revised requirements at Sec.  112.7(g) would apply
to all facilities (excluding oil production facilities), EPA proposes
to remove Sec.  112.6(c)(3), as it would be redundant.
    This proposal would allow an owner or operator to describe in his
SPCC Plan how he will:
     Secure and control access to all oil handling, processing
and storage areas;
     Secure master flow and drain valves;
     Prevent unauthorized access to starter controls on oil pumps;
     Secure out-of-service and loading/unloading connections of
oil pipelines; and
     Address the appropriateness of security lighting to both
prevent acts of vandalism and assist in the discovery of oil discharges.
    A facility owner and operator would be required to document in his
SPCC Plan how these security measures are implemented.
    These proposed requirements would replace the more prescriptive
fencing and other requirements, currently found in Sec.  112.7(g)(1)
through (5), and would allow the facility owner/operator to determine
how best to secure and control access to areas where a discharge to
navigable waters or adjoining shorelines may originate. With this
proposed rule revision, EPA would also allow the facility owner/
operator to determine how lighting can be used to deter intruders and
to assist in the discovery of oil discharges, or whether there is a
more appropriate, site-specific method. EPA believes that this proposed
amendment would likely eliminate the need for PE-certified
environmentally equivalent alternatives to the specified security
requirements, because the proposed provision would already provide the
flexibility for the owner/operator to provide whatever measures are
most appropriate for the facility, as long as they accomplish the
stated security goal.
    EPA requests comments on the appropriateness of extending the
streamlined security requirements already available to qualified
facilities to all facilities regulated by the SPCC rule. Any
suggestions for alternative approaches must include an appropriate
rationale and supporting data in order for the Agency to be able to
consider it for final action.
2. Alternative Option Considered: No Action
    EPA considered taking no regulatory action regarding this issue. A
facility owner or operator could continue to use alternate measures in
lieu of the more prescriptive requirements currently found at Sec. 
112.7(g), with a PE-certified explanation of how the alternate measures
are environmentally equivalent. However, EPA believes that modifying
the security requirements at Sec.  112.7(g) to make them consistent
with the streamlined, performance-based requirements currently provided
for qualified facilities is appropriate. Therefore, EPA chose not to
propose this ``no action'' option.

J. Integrity Testing

    In December 2006, EPA promulgated an amendment (71 FR 77266,
December 26, 2006) allowing the owner or operator of a qualified
facility to comply with streamlined integrity testing requirements.
This amendment allowed the owner or operator of a qualified facility to
consult and rely on industry standards to determine appropriate
qualifications for inspectors/testing personnel and the appropriate
integrity testing method for a particular container based on size,
configuration, and design, without the need for a PE-certified
explanation for this environmentally equivalent deviation from the
existing rule requirements at Sec.  112.8(c)(6) or Sec.  112.12(c)(6).
In the preamble to the proposal for this amendment (70 FR 73524,
December 12, 2005), EPA recognized that a facility owner or operator
could rely on the appropriate use of industry standards for integrity
testing requirements, and that in certain site-specific circumstances,
visual inspection may be appropriate and sufficient for compliance with
the integrity testing requirement. EPA has received comments from the
regulated

[[Page 58400]]

community suggesting that the integrity testing requirements
promulgated for qualified facilities should be extended to all
regulated facilities, for reasons consistent with those for a qualified
facility.
    EPA believes that owners or operators of all types of facilities
subject to either Sec.  112.8(c)(6) or Sec.  112.12(c)(6) would select
particular testing methods to comply with these requirements based on
industry inspection standards such as the Steel Tank Institute (STI)
SP001 (Standard for Inspection of Aboveground Storage Tanks) and
American Petroleum Institute (API) Standard 653 (Tank Inspection,
Repair, Alteration, and Reconstruction). For containers that meet
certain characteristics, industry standards may not require both visual
inspection and another system of non-destructive shell testing, as is
currently required in Sec. Sec.  112.8(c)(6) and 112.12(c)(6).
    For example, a facility may store oil in a mobile or portable
container, such as a 55-gallon drum. Under the current requirements at
Sec. Sec.  112.8(c)(6) and 112.12(c)(6), drums are required to be
visually inspected and are also subject to a non-destructive testing
method on a regular schedule. Alternatively, a Professional Engineer
may determine an environmentally equivalent measure, in accordance with
Sec.  112.7(a)(2). However, STI's SP001 standard specifies that the
minimum inspection requirement for portable containers, such as drums,
is visual inspection by the owner/operator unless no secondary
containment is provided. Therefore, under this proposal to revise the
integrity testing requirement, for portable containers provided with
secondary containment, periodic visual inspection only by the owner/
operator can be sufficient under Sec. Sec.  112.8(c)(6) and
112.12(c)(6). For portable containers without secondary containment,
the owner/operator must follow the requisite DOT leak testing and
recertification requirements as outlined in 49 CFR 173.28 (reuse,
reconditioning and remanufacturing of packaging), 49 CFR 178.803
(testing and certification of intermediate bulk containers (IBCs)), and
49 CFR 180.605 (or equivalent for portable container testing and
recertification). Currently, an owner/operator of a non-qualified
facility would need a PE to review and certify sections of his SPCC
Plan demonstrating that such inspection procedures, which are based on
provisions in the STI SP001 standard, are environmentally equivalent to
Sec.  112.8(c)(6) or Sec.  112.12(c)(6), even if the owner or operator
chooses to adopt inspection requirements directly from the industry
standard.
    Rather than require a PE-certified explanation of environmental
equivalence every time a facility owner or operator chooses to base
their integrity testing program on an industry standard instead of the
more stringent requirements in Sec.  112.8(c)(6) or Sec.  112.12(c)(6),
EPA is proposing to amend Sec. Sec.  112.8(c)(6) and 112.12(c)(6) to
replace these provisions with the more flexible language already
provided for qualified facilities at Sec.  112.6(c)(4)(ii).
1. Proposed Amendments to Integrity Testing Requirements
    EPA proposes to replace the current regulatory requirements at
Sec. Sec.  112.8(c)(6) and 112.12(c)(6) with the regulatory
requirements currently found at Sec.  112.6(c)(4)(ii). EPA believes
that any SPCC facility owner or operator subject to Sec.  112.8(c)(6)
or Sec.  112.12(c)(6) should be allowed the increased flexibility
offered by the inspection requirements at Sec.  112.6(c)(4)(ii) (and
corresponding reduction in burden associated with developing
environmental equivalence determinations), particularly for portable
containers. Because the proposed revised requirements at Sec. Sec. 
112.8(c)(6) and 112.12(c)(6) would apply to all facilities (excluding
oil production facilities), EPA is proposing to remove Sec. 
112.6(c)(4), as it would be redundant.
    This proposal requires a facility owner or operator to:
     Test/inspect each aboveground container for integrity on a
regular schedule and whenever material repairs are made.
     Determine, in accordance with industry standards, the
appropriate qualifications of personnel performing tests and
inspections, the frequency and type of testing and inspections, which
take into account container size, configuration, and design.
    These provisions allow an owner/operator to adopt inspection
requirements outlined in industry standards without the need for
environmental equivalence determinations to be certified by a PE. The
revised provision would continue to require an owner/operator to keep
comparison records (records of inspections and tests kept under usual
and customary business practices will suffice) and to inspect the
container's supports and foundations. The owner or operator would also
be required to conduct frequent inspection of the outside of the
container for signs of deterioration, discharges, or accumulation of
oil inside diked areas.
    It is important to note that, under this proposal, a facility owner
or operator may still deviate from the proposed rule provision, or from
an industry standard, if the alternate measure is equivalent to the
environmental protections provided by the rule requirement (as provided
in Sec.  112.7(a)(2)). In this case, a PE would need to certify the
reason for the deviation and that the alternate measures are
environmentally equivalent.
    EPA requests comments on the appropriateness of extending the
streamlined integrity testing requirements already available to
qualified facilities to all facilities subject to Sec.  112.8(c)(6) or
Sec.  112.12(c)(6). Any suggestions for alternative approaches must
include an appropriate rationale and supporting data in order for the
Agency to be able to consider it for final action.
2. Alternative Option Considered: No Action
    EPA considered taking no action to modify the requirements at
Sec. Sec.  112.8(c)(6) and 112.12(c)(6). However, the Agency believes
that all SPCC facility owners and operators subject to Sec. 
112.8(c)(6) or Sec.  112.12(c)(6) should be allowed the increased
flexibility offered by the inspection requirements currently provided
for qualified facilities, particularly for the inspection of portable
containers and small shop-built tanks. Therefore, EPA chose not to
propose this ``no action'' option.

K. Animal Fats and Vegetable Oils

    Stakeholders have commented that animal fats and vegetable oils
(AFVOs) merit differentiated requirements under the SPCC regulation. In
particular, the regulated community points to differences between the
toxicity and biodegradation profiles of AFVOs and those of petroleum
oils. Because of these claims, and in response to the Edible Oil
Regulatory Reform Act (EORRA), the Agency has on several occasions
formally requested information and supporting scientific data that
would inform such a determination.
    The Agency provided a detailed review of AFVO toxicity and
environmental effects as part of the denial of a petition requesting to
amend the Facility Response Plan (FRP) rule (62 FR 54508, October 20,
1997). EPA has reviewed the data available at that time, as well as
more recent data that the Agency has gathered (See Technical Background
Document for Animal Fats and Vegetable Oils Regulated under the Spill
Prevention, Control, and Countermeasure (SPCC) Regulation (40 CFR part
112) (September 12, 2007) in the docket for today's proposed
rulemaking). Based on this review, EPA

[[Page 58401]]

has determined that not all AFVOs are non-toxic. Additionally, there
are other non-AFVO oils which have toxicity profiles that are similar
to some AFVOs. Therefore, the Agency continues to believe that it is
not appropriate to differentiate between AFVOs and other oils based on
toxicity.
    In addition, in 1999, EPA issued an Advanced Notice of Proposed
Rulemaking (ANPRM) regarding differentiation of the requirements for
AFVOs from petroleum and other oils subject to the SPCC regulation (64
FR 17227, April 8, 1999). In the 2002 amendments to the SPCC rule, EPA
provided new subparts to facilitate differentiation between categories
of oil listed in EORRA (67 FR 47042, July 17, 2002). In December 2005,
the Agency again requested comments and scientific evidence to support
differentiation for AFVOs as part of a broader proposal to amend the
SPCC requirements (70 FR 73524, December 12, 2005). In December 2006,
the Agency promulgated amendments to the SPCC regulation, which
included removing requirements that were not applicable for facilities
that stored AFVO (71 FR 77266, December 26, 2006).
    The Agency has again examined the data submitted in response to the
aforementioned actions (Technical Background Document for Animal Fats
and Vegetable Oils Regulated under the Spill Prevention, Control, and
Countermeasure (SPCC) Regulation (40 CFR part 112), September 12,
2007). This data was submitted to support the claim that AFVOs
biodegrade more readily than petroleum oils and therefore merit
differentiated requirements under the SPCC rule. Although this data
indicates that the AFVOs tested degraded to a greater extent than the
petroleum oils tested, other data published in the scientific
literature suggests that other non-AFVOs (e.g., some petroleum and
synthetic oils) degraded equally to some AFVOs. EPA also notes that the
biodegradation data submitted has been generated from laboratory tests,
and therefore are only representative of the conditions set forth in
the test, representing a relatively limited comparison of some
vegetable oils with some petroleum oils. Additionally, other data
published in the scientific and technical literature suggests that not
all AFVOs are as readily biodegradable as some have claimed. These
findings are consistent with the findings from other organizations that
have used biodegradation tests to evaluate oils. That is, the
laboratory tests suggest that there are petroleum and/or other oils
that biodegrade similarly to AFVOs. As a result, EPA is unable to
establish a ``bright line'' between AFVOs and all other oils based on
biodegradability, and thus believes it is not appropriate to
differentiate between them based on this criterion. For more
information, see Technical Background Document for Animal Fats and
Vegetable Oils Regulated under the Spill Prevention, Control, and
Countermeasure (SPCC) Regulation (40 CFR part 112), (September 12,
2007), in the docket for this proposed rulemaking.
    EPA is now considering whether there would be an alternative
approach to differentiation that is not based on the oil's toxicity and
its inherent physical/chemical properties, but rather based on the way
these oils are stored and handled at a facility. EPA has focused
specifically on the integrity testing requirements for bulk storage of
AFVOs to address concerns raised by the regulated community. Therefore,
the Agency is considering a compliance alternative for differentiated
integrity-testing requirements for certain bulk storage containers that
store AFVOs and that meet specific design and operational criteria.
    Specifically, EPA is proposing to modify Sec.  112.12(c)(6) to
provide the PE or the owner or operator certifying an SPCC Plan the
flexibility to determine the scope of integrity testing that is
appropriate for certain AFVO bulk storage containers. This flexibility
would apply to those bulk storage containers that are subject to the
applicable sections of the Food and Drug Administration (FDA)
regulation 21 CFR part 110, Current Good Manufacturing Practice in
Manufacturing, Packing or Holding Human Food, and that meet the
following additional criteria: (1) Are elevated; (2) made from
austenitic stainless steel; have (3) no external insulation; and (4)
are shop-built. That is, an owner or operator would be allowed to use
industry standards for visual inspection of these containers, in lieu
of the current integrity testing requirements (i.e., visual inspection
and some other testing technique) or the proposed revisions to the
integrity testing requirements as outlined under Section J in this
proposal without having to make an environmental equivalence
determination, including stating the reasons for nonconformance with
the current integrity testing requirements, in accordance with Sec. 
112.7(a)(2). The owner or operator would be required to document
procedures for inspections and testing in the SPCC Plan, including
those for AFVO bulk storage containers that are eligible for the
differentiated requirements in this proposal. EPA believes that AFVO
bulk storage containers which meet the above criteria already have
environmentally equivalent measures in place for integrity testing and
thus, do not need to state reasons for nonconformance with the current
integrity testing requirements (i.e., visual inspection and some other
testing technique). Therefore, we are proposing this alternative option
for integrity testing and no environmental equivalence determination in
accordance with Sec.  112.7(a)(2) is necessary. This alternative would
typically apply at food processing facilities that are subject to 21
CFR part 110 and store animal fats or vegetable oil that are intended
for human consumption. The regulations at 21 CFR part 110 have specific
requirements for the design, construction, and use of AFVO equipment.
The Agency believes that the proposed criteria ensure that the AFVO
containers are less prone to internal and external corrosion and that
the design elements make visual inspection effective.
1. Differentiation Criteria
    Properly designed and implemented integrity testing programs
include practices and procedures to identify potential alterations to a
bulk storage container's shell, bottom plate, foundation, and/or
attached ancillary equipment, all of which may compromise a container's
integrity. EPA generally believes it is important that the Plan include
the scope of an integrity-testing program with consideration of
established industry standards. Factors to consider when industry
standards do not exist include, but are not limited to, the likelihood
of the deterioration of the container foundation, stress-induced
fractures in the shell wall or bottom plate, and internal and external
corrosion. These are the factors the Agency considered in setting the
proposed criteria. The FDA requirements for design and maintenance in
addition to the criteria outlined in this proposal would be
environmentally equivalent to the current integrity testing
requirements under Sec.  112.12(c)(6).
a. Containers Subject to FDA Regulations--21 CFR Part 110
    When developing an integrity-testing program for AFVO bulk storage
containers, FDA rule requirements may serve, in whole or in part, as
alternative measures that provide equivalent environmental protection
to an industry standard. Applicable requirements within 21 CFR part
110, when taken

[[Page 58402]]

together with the additional criteria in this proposal, can serve as
equivalent alternative measures that include the main elements of an
integrity-testing program under the SPCC regulation. The minimal
elements for this type of integrity-testing program can be separated
into three main structural integrity areas: (1) Container foundations,
(2) container support structures, and (3) the container itself. FDA
requirements in each of these areas serve to support this proposed rule
for AFVO.
    i. Container Foundations. FDA requires that facilities be
constructed in such a manner that the floor, walls, and ceilings be
adequately cleaned and kept clean and in good repair (21 CFR
110.20(b)(4)). Bulk storage containers that sit atop floors that fall
under this requirement are expected to be maintained and kept in good
repair. Substances that accumulate on the floor can present an
unsanitary condition, which may lead to food contamination. In
addition, cracks in the floor under and/or around the foundation of a
bulk storage container can accumulate food particles, organic matter,
pests, and other potentially unsanitary substances that also could lead
to food contamination. EPA believes that the procedures and practices,
such as frequent monitoring of the floor around a bulk storage
container, that are implemented in order to address this requirement
serve not only to comply with the FDA requirements, but also address
the elements associated with the structural integrity of the
container's foundation.
    ii. Container Support Structures. FDA requires all plant equipment,
including the container's structural supports, to be designed of such
material and workmanship as to be adequately cleanable, and for it to
be properly maintained (21 CFR 110.40(a)). Periodic maintenance of the
structural support(s) of a bulk storage container is also an oil spill
preventive measure, especially inside a facility where mobile equipment
(e.g. forklifts) can strike and damage the container and/or its
structural supports.
    iii. Container Itself. When considering the potential for
corrosion, EPA considered the FDA requirements for food contact
surfaces (e.g., internal surface of a food oil bulk storage container)
and non-food contact surfaces (e.g., external surface of a bulk storage
container). In most cases, FDA requirements address only food contact
surfaces. For the purpose of oil spill prevention, the potential for
corrosion of the external surface of bulk storage container is equally
important.
    Internal Corrosion. FDA requires the design, construction, and use
of equipment to preclude the adulteration of food with, among other
potential contaminants, metal fragments (21 CFR 110.40(a)). FDA further
requires that food contact surfaces shall be corrosion-resistant when
in contact with food. While it is possible that corrosion of the
interior surface of a bulk storage container can occur, it is also
likely that any metal that dislodges from the interior surface is
captured by a means that prevents metal inclusion. EPA believes that an
owner or operator of a facility that monitors AFVOs for metal fragments
as the oil exits the bulk storage container, either by sampling the oil
itself for metal or by monitoring the inclusion prevention device for
metal fragment accumulation, is a reasonable alternative approach to an
internal inspection for corrosion. This, in conjunction with the design
and applicable regulatory requirements are likely to prevent the
corrosion of the internal contact surface in food grade AFVO bulk
storage containers.
    External Corrosion. For some bulk storage container configurations,
external corrosion can be the primary concern with respect to their
integrity. Significant corrosion to the exterior surface can occur from
exposure to moisture and in some cases, may be enhanced if insulation
is present. Significant corrosion can also occur from overfills of oil
and/or any associated substance(s) that have accumulated on the
exterior surface, as well as from cleaning and sanitizing agents.
    FDA requires equipment that is in the manufacturing or food-
handling area and that does not come into contact with food must be
constructed to be kept in a clean condition (21 CFR 110.40(c)).
Exterior surface of bulk storage containers that are located in the
manufacturing or food-handling area and that are subject to this
requirement, are expected to be maintained to a higher standard than
other bulk storage containers, which are not subject to a similar
requirement. Since plant equipment used in the manufacturing or food-
handling area must be designed to be kept clean and withstand the
corrosive effects of cleaning agents, it is generally constructed of
austenitic stainless steel.
    EPA requests comments on the appropriateness of using the FDA
requirements under 21 CFR part 110 as a criterion for the proposed
alternative approach for integrity testing. Any suggestions must
include an appropriate rationale in order for the Agency to be able to
consider it for final action.
b. Elevated Bulk Storage Containers
    FDA recommends, but does not require, that all plant equipment be
installed and maintained to facilitate its cleaning, including all
adjacent spaces. According to 21 CFR 110.40(a), ``all equipment should
be so installed and maintained as to facilitate cleaning of the
equipment and of all adjacent spaces.'' In practice, an owner or
operator of a facility implementing this recommended practice is likely
to have a bulk storage container that is elevated off the floor, based
upon discussion with AFVO container manufacturers and owners or
operators of AFVO facilities. Food equipment is generally designed to
stand on legs, which elevates the plant equipment off the floor so that
the space between the plant equipment and the floor can be cleaned. For
the purposes of oil spill prevention, elevated bulk storage containers
allow visual inspections for oil discharges all around the container.
    An elevated bulk storage container also facilitates complete
drainage because the oil can be withdrawn from the lowest point in the
container, so that foreign substances or materials do not accumulate
and contaminate the food oil. For the purposes of oil spill prevention,
self-draining containers operating using gravity flow allows complete
drainage and prevents substances other than oil (e.g., water) from
accumulating at the bottom of the container, thus minimizing corrosion.
EPA believes that the self-drainage design, in conjunction with the
applicable regulatory requirements, is likely to prevent the corrosion
of the internal contact surface in food grade AFVO bulk storage containers.
    EPA requests comments on this criterion for the proposed
alternative approach for integrity testing for AFVO bulk storage
containers. Any suggestions must include an appropriate rationale and
supporting data in order for the Agency to be able to consider it for
final action.
c. Containers Made From Austenitic Stainless Steel
    AFVOs are not required explicitly to be stored in austenitic
stainless steel bulk storage containers under 21 CFR part 110. For
example, a carbon steel container with an internal liner may suffice
for the corrosion resistant requirements under FDA because in this case
the lining is the food contact surface that is corrosion resistant.
Although this meets the regulatory requirements for food contact
surfaces, it also may be an indication that the oil in the bulk storage
container is

[[Page 58403]]

incompatible with an unlined bulk storage container of the same material.
    In addition, EPA believes that non-homogenous container systems
(e.g., containers with external insulation, external coating, mild-
carbon steel shell, internal liner) are more complex than homogenous
container systems (e.g., containers constructed solely of austenitic
stainless steel) and may require additional inspection measures to
ensure the integrity of the container. Furthermore, austenitic
stainless steel containers are often used because cleaning agents and
acidic detergents used to clean food and non-food contact surfaces can
be corrosive if used on incompatible surfaces. Therefore, EPA proposes
to limit this alternative approach for integrity testing to AFVO bulk
storage containers made of austenitic stainless steel.
    It is important to note that this limitation is only for an owner
or operator that chooses to take advantage of the alternative
compliance option. A facility Plan may still be certified with an
environmental equivalence determination, in accordance with Sec. 
112.7(a)(2) of the SPCC rule, for other types of bulk storage
containers that are similarly corrosion resistant.
    EPA requests comments on this criterion for the proposed
alternative approach for integrity testing for AFVO bulk storage
containers. Any suggestions must include an appropriate rationale and
supporting data in order for the Agency to be able to consider it for
final action.
d. Containers With No External Insulation
    EPA proposes to limit this proposed alternative option to
containers with no external insulation. The Agency believes that
inspections based on frequent monitoring of the exterior surface of a
bulk storage container for corrosion and/or other mechanisms that can
threaten a container's integrity is a minimum criterion for an
alternative measure that provides equivalent environmental protection.
External insulation covering the outside of a bulk storage container
acts as a physical barrier to effective visual examination of the
exterior surface. If not properly sealed, insulating materials covering
the exterior surface of a bulk storage container and/or any associated
equipment and piping can become damp. Insulation that retains moisture
and that is adjacent to a container's exterior surface can cause
significant corrosion, which may threaten the integrity of the
container.
    EPA is unaware of any sanitation provision or regulatory
requirements that require an inspection between the insulation and the
exterior surface of a bulk storage container. Furthermore, we do not
know of any established industry methods or procedures, or industry
standards specific to AFVOs, to evaluate the exterior surface of a bulk
storage container that is covered by insulation. Therefore, EPA
believes only containers with no external insulation should be included
in this proposed alternative option for integrity testing.
    EPA requests comments on this criterion for the proposed
alternative approach for integrity testing for AFVO bulk storage
containers. Any suggestions must include an appropriate rationale and
supporting data in order for the Agency to be able to consider it for a
final action. Additionally, we seek input on any applicable standards,
sanitary provisions, or other regulatory requirements that apply to the
construction, design and/or inspection of AFVO bulk storage containers.
e. Shop-Fabricated Containers
    EPA has stated that visual inspection might suffice for elevated
shop-built bulk storage containers because these containers can be
inspected on all sides (67 FR 47120, July 17, 2002). In the SPCC
Guidance for Regional Inspectors document, EPA went on to say that ``*
* * visual inspection provides equivalent environmental protection when
accompanied by certain additional actions to ensure that the containers
are not in contact with the soil. These actions include elevating the
container in a manner that decreases corrosion potential and makes all
sides of the container, including the bottom, visible during
inspection.'' Shop-fabricated bulk storage containers, as opposed to
field-erected, may best fit these conditions.
    EPA proposes to limit this proposed alternative option to shop-
fabricated containers (i.e., shop-built). Shop-fabricated containers
are those containers that are shop-assembled in one piece before
transport to the installation site which limits the maximum capacity of
the container so that they can be transported over the road by truck.
Shop-fabricated containers generally have lower volume capacities,
smaller tank diameters, and a fewer number of welds than field-erected
containers and are typically comprised of a single type of material
with a single wall thickness.
    Alternatively, field-erected (i.e., field-constructed) containers
can store much larger volumes of oil because individual pieces of the
container can be transported to and assembled at the installation site,
leading to much larger container capacities. Because of their greater
size and complexity, field-erected containers have more stringent
engineering requirements than shop-fabricated containers which would
need to be considered in developing an appropriate inspection program.
For example, field-erected containers may have variable shell-wall
thicknesses, and/or be comprised of different materials to account for
variations in the stresses caused by hydrostatic pressure. These field-
erected containers generally have a significantly greater number of
welds as compared to a shop-fabricated container because they are
fabricated on-site from individual pieces. The stress on the container
walls and joints is greater as the diameter and/or height of the
container increases. Finally, a brittle fracture evaluation of a field-
erected container may be necessary if the thickness of the shell wall
is above a certain value and the container undergoes a repair,
alteration, reconstruction, or a change in service that might affect
the risk of a discharge or failure. The complexity associated with the
construction of field-erected containers is considered in designing the
scope and frequency of an integrity testing program.
    This proposal, therefore, is limited to shop-fabricated containers
because they are simpler in design and construction (e.g., typically
subject to less stress, have fewer welds, and are less likely to be
subject to brittle fracture failure) than field-erected containers. The
Steel Tank Institute's (STI) SP001, Standard for the Inspection for
Aboveground Storage Tanks, establishes the scope and frequency for
visual inspections of shop-fabricated containers. This proposed rule is
consistent with past regulatory guidance and current industry best
practices for this particular class of bulk storage containers and
thus, the Agency is proposing to require that the alternative option be
limited to shop-fabricated containers.
    EPA requests comments on this criterion for the proposed
alternative approach for integrity testing for AFVO bulk storage
containers. Any suggestions must include an appropriate rationale and
supporting data in order for the Agency to be able to consider it for a
final action.
2. Required Recordkeeping
    The SPCC regulations require inspections and tests be conducted in
accordance with the written procedures that the owner or operator or
the certifying PE develop for the facility be kept with the SPCC Plan
in accordance with the recordkeeping provisions of

[[Page 58404]]

Sec.  112.7(e). We believe that visual inspection that is part of
periodic maintenance of bulk storage container's support and foundation
must be documented. Records of inspections and tests kept under usual
and customary business practices will suffice. To develop an
appropriate inspection, evaluation, and testing program for an SPCC-
regulated facility, the PE should refer to the appropriate requirements
under 21 CFR part 110.
    For these reasons, EPA believes that streamlined integrity-testing
requirements for certain AVFO containers are warranted. This proposal
does not relieve an owner or operator from complying with any other
bulk storage container requirement in Sec.  112.12(c). The Agency
requests comments on the proposed approach and criteria. Any
suggestions for alternative approaches must include a rationale and
supporting data in order for the Agency to be able to consider it for
final action.

L. Oil Production Facilities

    Since its original promulgation in 1973, the SPCC rule has included
differentiated requirements for oil production facilities (Sec. 
112.9), as compared to other types of facilities (Sec. Sec.  112.8,
112.10, 112.11., and 112.12). Based on issues brought forth by the
regulated community and by other federal agencies (e.g., DOE), EPA is
considering several ways that SPCC requirements can be further
streamlined, tailored, or clarified for oil production facilities.
    As discussed in Section F above, EPA is proposing to exclude oil
production facilities from the loading/unloading rack requirements at
Sec.  112.7(h) because oil production facilities typically do not have
the equipment meeting the proposed definition for a loading/unloading
rack. Such oil production facilities may also benefit from the proposed
revisions to the definition of ``facility,'' as described in Section D
above, which may allow greater flexibility in determining the extent of
a facility. Consistent with the revisions to the definition of
``facility,'' EPA is also proposing revisions to the definition of
``production facility'' to clarify that the production facility
definition does not govern the applicability of 40 CFR part 112, but
rather establishes which specific provisions of the rule may apply at a
particular facility.
    Additional specific modifications being proposed in this notice, as
discussed below, include: Extending the timeframe by which a new oil
production facility must prepare and implement an SPCC Plan; exempting
flow-through process vessels at oil production facilities from the
sized secondary containment requirements while maintaining general
secondary containment requirements and requiring additional oil spill
prevention measures; establishing more prescriptive requirements for
contingency planning and a flowline/intra-facility gathering line
maintenance program, while exempting flowlines and intra-facility
gathering lines at oil production facilities from secondary containment
requirements; and clarifying the definition of ``permanently closed''
as it applies to an oil production facility. EPA also describes
approaches for alternative criteria for an oil production facility to
be eligible to self-certify an SPCC Plan as a qualified facility, and
approaches to address produced water storage containers at an oil
production facility.
1. Definition of Production Facility
    As described in section D above, EPA is proposing to modify the
definition of ``facility'' to clarify that contiguous or non-contiguous
buildings, properties, parcels, leases, structures, installations,
pipes, or pipelines may be considered separate facilities, and to
specify that the ``facility'' definition governs the applicability of
40 CFR part 112. These proposed revisions would allow an owner or
operator to separate or aggregate containers to determine the facility
boundaries, based on such factors as ownership or operation of the
buildings, structures, containers, the activities being conducted,
property boundaries, and other relevant considerations. To provide
clarity consistent with these proposed revisions, EPA is also proposing
certain revisions to the definition of ``production facility.''
a. Proposed Revisions to the Definition of Production Facility
    EPA is proposing to amend the definition of ``production
facility,'' as found in Sec.  112.2, in two ways. First, consistent
with the proposed revision to the definition of ``facility,'' EPA seeks
to clarify that while only the definition of ``facility'' governs the
overall applicability of 40 CFR part 112, the definition of
``production facility'' is used to determine which of the type-specific
sections of the rule may apply at a particular facility, in addition to
the general rule sections. For example, if an onshore facility meets
the definition of ``production facility,'' then the owner or operator
is subject to the provisions of Sec.  112.9, or potentially to the
provisions of Sec.  112.10 if the facility is involved in drilling or
workover activities, in addition to Sec. Sec.  112.1 through 112.7.
    Second, consistent with the proposed revisions to the definition of
``facility'' that emphasize the flexibility in how a facility owner or
operator can determine the boundaries of a facility, EPA is proposing
to modify the definition of ``production facility'' to clarify the
flexibility allowed in determining the extent of the facility. The
current definition includes the phrase ``and located in a single
geographical oil or gas field operated by a single operator.'' EPA
proposes to modify the phrase to clarify that a production facility
``may be located in a single geographical oil or gas field operated by
a single operator.'' Because the definition of facility is flexible,
EPA recognizes that a production facility need not be located in a
single geographical field operated by a single operator. Like other
facilities, a production facility's boundaries may be determined based
on site-specific factors such as ownership, management, or operation of
the containers, buildings, structures, equipment, installations, pipes,
or pipelines on the site; similarity in functions, operational
characteristics, and types of activities occurring at the site;
adjacency; or shared drainage pathways.
    The Agency seeks comments on whether the proposed revision to the
definition of ``production facility'' is appropriate. Specifically, EPA
seeks comment on whether the phrase ``and located in a single
geographical oil or gas field operated by a single operator'' should be
deleted from the definition to provide greater clarity. Any suggestions
for alternative language to amend the definition must include an
appropriate rationale in order for the Agency to be able to consider it
for final action.
b. Clarifications Related to Drilling and Workover Facilities
    Under the SPCC rule, the term ``production facility'' can encompass
drilling and workover activities, as well as production operations.
However, different provisions of the rule apply to these different
activities. Therefore, EPA seeks to clarify the requirements applicable
to the various phases of activities at a production facility: drilling,
production, and workover.
    Both drilling and workover activities tend to be temporary in
nature and are performed using mobile rigs and associated equipment.
The owner or operator is required to develop an SPCC Plan under Sec. 
112.3(c) because a drilling or workover facility is considered a mobile
facility. He is subject to the administrative and general requirements

[[Page 58405]]

of the SPCC rule (Sec. Sec.  112.1 through 112.7), as well as the
specific requirements in Sec.  112.10 (for onshore facilities) or Sec. 
112.11 (for offshore facilities). EPA notes that under the requirements
of Sec. Sec.  112.10 and 112.11, a regulated oil storage container
associated with a drilling or workover facility is subject to the
general secondary containment requirement (Sec.  112.7(c)); however, no
sized secondary containment requirements exist.
    Drilling activities involve the initial establishment of an oil
well: drilling the hole, inserting and cementing the casing, and
completing the well to start the flow of oil to the surface. As noted
above, a drilling facility must prepare and implement an SPCC Plan and
is subject to the specific requirements in Sec.  112.10 (for onshore
facilities) or Sec.  112.11 (for offshore facilities).
    Once the oil is flowing, the drilling rig is removed from the site
and production equipment, such as a pump or valve assembly, is set up
to extract or control the flow of oil from the well. At this point,
drilling activities have ceased and production has begun; the facility
is considered a production facility. The processes performed at a
typical oil production facility include extraction, separation and
treatment, storage, and transfer. The owner or operator of a production
facility is subject to the administrative and general requirements of
the SPCC rule (Sec. Sec.  112.1 through 112.7) as well as the specific
requirements in Sec.  112.9 (for onshore facilities) or Sec.  112.11
(for offshore facilities).
    During the life of an oil well, maintenance or remedial work may be
necessary to improve productivity. A specialized workover rig,
equipment, and associated containers are brought onsite to perform the
maintenance or remedial activities. Workover operations are distinct
from the normal production operations, and as such are not subject to
the requirements of Sec.  112.9, but are subject to the applicable
requirements in Sec.  112.10 (for onshore facilities) or Sec.  112.11
(for offshore facilities). Because workover activities are a distinct
operation and may be conducted by a separate owner or operator, a
workover operation may be considered a separate, mobile facility, and
described in a different SPCC Plan, separate from the production
facility. EPA notes that although production activities may temporarily
cease during workover, if the production equipment and containers (such
as those found in a tank battery) remain operable then the production
facility owner/operator must maintain his own SPCC Plan during workover
activities. To clarify that drilling and workover activities are not
subject to the provisions at Sec.  112.9, EPA proposes to amend the
title of Sec.  112.9 to read ``Spill Prevention, Control, and
Countermeasure Plan requirements for onshore oil production facilities
(excluding drilling and workover facilities).'' EPA also proposes to
amend the introductory sentence of the section accordingly.
    The Agency seeks comments on whether the proposed revisions to the
title and introductory sentence of Sec.  112.9 adequately clarify that
the section does not apply to drilling and workover facilities. Any
suggestions for alternative approaches must include an appropriate
rationale in order for the Agency to be able to consider it for final
action.
2. SPCC Plan Preparation and Implementation
    EPA proposes to amend Sec.  112.3(b) to extend the timeframe by
which an oil production facility that becomes operational after July 1,
2009 must prepare and implement an SPCC Plan. Under the current rule,
any facility that becomes operational after July 1, 2009 (a ``new
facility'') must prepare an SPCC Plan before beginning operations.
Unlike other facilities subject to the SPCC rule, however, an oil
production facility has unique characteristics during the start-up
period of its operations, which lead to variability in the amount and
type of oil handled. EPA recognizes that, based on the often variable
conditions of the oil reservoir, for some oil fields, the type and
proportion of products may be uncertain until after the processes of
extraction have begun. Additionally, the amount of pressure in the
reservoir and the changes introduced by drilling the well hole could
lead to variable initial flowrates that may take time to stabilize.
While a new oil production facility on an older oil field may have
predictable flowrates and proportion of product, the Agency notes the
importance of providing this proposed relief for newer oil fields. The
variables associated with the start of operations could lead to
significant changes in necessary storage capacity and facility design.
Such changes would necessitate that an owner/operator of a new oil
production facility continually amend his Plan until operations
stabilize, and have a licensed PE certify (or owner or operator of a
qualified facility self-certify) any technical amendment. To alleviate
this burden, EPA proposes to extend the time by which a new oil
production facility must prepare and implement an SPCC Plan.
a. Proposed Timeframe for Plan Preparation and Implementation
    The proposed amendment would allow a new oil production facility
that becomes operational after July 1, 2009 six months after the start
of operations to prepare and implement a Plan. The ``start of
operations'' for an oil production facility is indicated by the start
of well fluid pumping, transfer via flowlines, separation, treatment or
storage of crude oil. EPA proposes to exclude oil production facilities
from the current requirements at Sec.  112.3(b)(1), and to add a new
paragraph at Sec.  112.3(b)(3) to provide the requirement for an owner
or operator of a new oil production facility to prepare and implement
an SPCC Plan six months after the start of operations.
    The timeframe by which EPA is proposing to extend SPCC Plan
preparation and implementation was chosen based on EPA's professional
judgment, because such oil production facilities are likely to
stabilize within six months after the start of operations. The proposed
amendment is extended to oil production facilities only due to the
circumstances specific to an oil production facility--their unique
characteristics of variable and uncertain initial flowrates.
    Delaying SPCC Plan preparation and implementation for a period of
time after operations begin is somewhat consistent with the
requirements originally promulgated in 1973 (38 FR 34164, December 11,
1973). At the time the rule was originally promulgated, EPA required
preparation of an SPCC Plan six months after the start of operations
and implementation of the Plan no later than one year after the start
of operations. This requirement was amended in 2002 (67 FR 47042, July
17, 2002) to require new facilities (those that become operational
after the effective date of the rule) to prepare and implement an SPCC
Plan before beginning operations. EPA made this change because new
facilities generally should already be aware of the need for an SPCC
Plan. That is, new facilities subject to the SPCC rule are able to take
SPCC requirements into consideration and undertake the necessary
construction, purchase equipment, or develop procedures before the
start of operations. However, this amendment in 2002 did not take into
consideration the unique nature of oil production facilities.
    Unlike the requirements originally promulgated in 1973, the proposed 
amendment combines the date for Plan preparation and implementation,

[[Page 58406]]

allowing six months total time to both prepare and implement an SPCC Plan.
    EPA notes that it is reasonable and usually less expensive to
implement certain oil spill prevention measures, such as secondary
containment around containers, at the time of the container
installation. Therefore, EPA recognizes that even during the interim
period before required Plan preparation and implementation, an oil
production facility may already have certain environmentally protective
measures in place. Under Section 311(b)(3) of the Clean Water Act, the
oil production facility owner or operator would still be liable for any
harmful quantities of oil discharged from the facility into navigable
waters or adjoining shorelines, even before the requirement to prepare
and implement an SPCC Plan comes into effect. Furthermore, the Regional
Administrator would continue to have the authority under Sec.  112.1(f)
to require an owner or operator of an oil production facility to
prepare and implement an SPCC Plan or any applicable part at any point
during the six months after start of operations, if a determination is
made that it is necessary to prevent a discharge of oil into navigable
waters or adjoining shorelines. In addition, a facility owner/operator
can request an extension of time to come into compliance in accordance
with Sec.  112.3(f) if circumstances are beyond his control, e.g.,
there are no qualified personnel available or construction or equipment
delivery delays.
    The proposed rule amendment would apply only to a new oil
production facility. The proposed amendment would not apply to a
drilling or workover facility. Drilling and workover facilities are
subject to the requirement at Sec.  112.3(c) for mobile facilities and
may implement a general Plan. Therefore, during the initial drilling of
the well, there are measures required for spill prevention and response
for any oil discharges.
    EPA requests comments on whether an amendment to the Plan
preparation and implementation date is appropriate for new oil
production facilities, and whether new facilities in other industry
sectors have similar variability during the start-up period of
operations and would therefore benefit from a similar compliance date
extension. Any suggestions must include an appropriate rationale and
supporting data in order for the Agency to be able to consider it for
final action.
b. Alternative Option Considered: One Year for Oil Production
Facilities To Prepare and Implement a Plan
    EPA considered an alternate option to address the variability in
start-up operations at a new oil production facility, wherein an owner/
operator would be allowed one year for SPCC Plan preparation and
implementation after the start of operations. A variation of this
alternative is to allow six months after the start of operations for
SPCC Plan preparation, and another six months (for a total of one year
after the start of operations) for Plan implementation. EPA recognizes
that providing one year is consistent with the original promulgation of
the rule in 1973. However, in proposing this amendment, EPA intends to
provide this relief given the unique characteristics of a new oil
production facility. Given that an oil production facility is likely to
stabilize operations within six months from start-up, one year for Plan
preparation and implementation does not seem necessary. The date for
SPCC Plan preparation and implementation was selected given the
timeframe for stabilization of operations at a new oil production
facility. Additionally, a facility owner/operator can request an
extension of time to come into compliance in accordance with Sec. 
112.3(f) if circumstances are beyond his control, e.g., no qualified
personnel available or construction or equipment delivery delays.
Therefore EPA chose not to propose this option.
    The Agency welcomes comments on this alternative or other
alternatives regarding the variability during the start-up period of
operations at a new oil production facility. Any suggestions must
include an appropriate rationale and supporting data in order for the
Agency to be able to consider it for final action.
3. Flowlines and Intra-Facility Gathering Lines
    EPA proposes to exempt flowlines and intra-facility gathering lines
from the secondary containment requirements under the SPCC rule. In
lieu of a secondary containment requirement, EPA proposes to require a
contingency plan and written commitment of manpower, equipment, and
materials for flowlines and intra-facility gathering lines at an oil
production facility, and to prescribe specific requirements for a
flowline and intra-facility gathering line maintenance program.
a. Examples of Flowlines and Gathering Lines
    For the purposes of the SPCC rule, flowlines are considered to be
the piping that transfers oil and well fluids from the wellhead to the
tank battery where separation and treatment equipment are typically
found. A flowline may also connect a tank battery to an injection well.
Flowlines are relatively small diameter steel or fiberglass piping
(generally less than four inches). Depending on the size of the oil
field, flowlines may run for hundreds of feet to a tank battery.
    The term ``gathering lines'' is a general term referring to the
piping or pipelines that transfer the crude oil product between tank
batteries, within or between facilities. Gathering lines often emanate
from an oil production facility's lease automatic custody transfer
(LACT) unit, which transfers oil to other facilities involved in
gathering, refining or pipeline transportation operations. EPA
recognizes that gathering lines are often outside of the Agency's
jurisdiction because they ``transport'' oil outside of an oil
production facility. Based on a 1971 Memorandum of Understanding (MOU)
with the Department of Transportation (DOT) (see Appendix A to 40 CFR
part 112), EPA has jurisdiction only over non-transportation-related
facilities, which includes pipelines that transport oil within a
facility. Any pipeline, including a gathering line, that transports oil
between facilities or from a facility to a vessel, is considered
transportation-related and is therefore outside the jurisdiction of EPA
and not subject to the SPCC rule. However, the definition of
``facility'' as it applies to the SPCC rule is flexible. As discussed
in Section D of this preamble, an owner/operator can choose to
determine the facility's boundaries based on a number of site-specific
factors. A typical oil production facility includes a wellhead, a tank
battery (including, but not limited to, separation equipment, stock oil
containers and produced water containers), and the flowlines that
transfer the oil and well fluids from the wellhead to the tank battery.
Depending upon how an owner/operator defines his facility, an oil
production facility may also include gathering lines. For example, if
multiple tank batteries are included as part of the same facility for
purposes of developing one SPCC Plan, then any gathering lines that
connect the tank batteries, or flow to a central collection or
gathering area or centralized tank battery within the facility
boundaries, must also be included in the SPCC Plan. EPA

[[Page 58407]]

considers any gathering lines within the boundaries of a facility to be
``intra-facility gathering lines'' and within EPA's jurisdiction for
the purposes of SPCC rule applicability.
    EPA notes that the definition of ``production facility'' has
included both the terms ``flowlines'' and ``gathering lines'' since it
was promulgated in July 2002 (67 FR 47042), and that EPA is simply
clarifying, not modifying, the applicability to these types of
pipelines found within a facility (``intra-facility'').
    Given the common understanding of the terms ``flowline'' and
``gathering line'' within the oil production sector, EPA does not
believe that it is necessary to propose definitions for these terms
under Sec.  112.2. However, EPA requests comments as to whether
regulatory definitions for ``flowline'' and ``intra-facility gathering
line'' are necessary, and if so, suggestions for an appropriate
definition. Any suggestions must include an appropriate rationale and
supporting data in order for the Agency to be able to consider it for
final action.
b. Requirements in Lieu of Secondary Containment
    The SPCC rule requires secondary containment for all areas of a
facility where there is a potential for discharge as described in Sec. 
112.1(b). This requirement, found at Sec.  112.7(c), applies to
flowlines and intra-facility gathering lines. However, EPA recognizes
that providing secondary containment for these pipelines can be
difficult and expensive for an owner/operator because these lines are
often several miles long, buried, and can extend far from the main
facility. Flowlines and intra-facility gathering lines often are placed
across land that is not owned by the owner/operator of the oil
production facility (e.g., agricultural land), and providing secondary
containment for these lines can be difficult, intrusive, or disruptive
to the property owner. When flowlines and intra-facility gathering
lines are located in farm fields, providing a secondary containment
structure may result in soil erosion and negative impacts to the land.
Buried flowlines present additional difficulty, because their exact
location may be uncertain, especially at an oil production facility that 
has changed ownership since the original installation of the flowlines.
    The Agency is responding to the concerns described above by
proposing tailored relief in an effort to improve compliance and
enhance environmental protection. EPA believes that secondary
containment is, in most cases, impracticable for flowlines and intra-
facility gathering lines. Therefore, EPA is proposing an amendment to
Sec.  112.7(c) that would remove secondary containment requirements for
flowlines and intra-facility gathering lines at an oil production
facility, and instead require implementation of an oil spill
contingency plan in accordance with 40 CFR part 109 (Criteria for
State, Local and Regional Oil Removal Contingency Plans) and a written
commitment of manpower, equipment, and materials required to
expeditiously control and remove any quantity of oil discharged that
may be harmful, without having to make an impracticability
determination for each piece of piping. This new requirement would be
found in proposed revisions to Sec.  112.9(d)(3). It should be noted
that the use of a contingency plan does not relieve the owner/operator
of liability associated with an oil discharge to navigable waters or
adjoining shorelines that violates the provisions of Section 311(b)(3)
of the Clean Water Act, 33 U.S.C. 1321(b)(3).
    In the preamble to the 2002 amendments (67 FR 47042, July 17,
2002), EPA discusses how any facility owner/operator who makes a
determination of impracticability and has submitted a Facility Response
Plan (FRP) under Sec.  112.20 has satisfied the contingency planning
requirement, because an FRP is more comprehensive than a contingency
plan under 40 CFR part 109. Similarly, the Agency believes that the
owner or operator of an oil production facility who has prepared an FRP
would satisfy the contingency planning requirement for flowlines and
gathering lines. If such a facility owner/operator has already
developed an FRP to comply with Sec.  112.20, then he or she would not
need to also develop a contingency plan in accordance with 40 CFR part
109. However, the facility owner or operator would still be required to
comply with the revised flowline/intra-facility gathering line
maintenance program requirements proposed in this notice.
    Finally, EPA acknowledges that given the characteristics of certain
intra-facility gathering lines, these pipelines may be regulated under
requirements of both EPA and DOT. Because DOT requirements for
pipelines may be similar in purpose and scope, EPA recognizes that
compliance with DOT requirements (e.g., 49 CFR part 194) for these
gathering lines may be considered to satisfy the contingency planning
requirement.
    EPA requests comments on whether exempting flowlines and intra-
facility gathering lines from the secondary containment requirement is
appropriate, and whether the provision for a contingency plan and
written commitment of manpower, equipment, and materials required to
expeditiously control and remove any quantity of oil discharged that
may be harmful is an adequate alternative measure. Any suggestions must
include an appropriate rationale and supporting data in order for the
Agency to be able to consider it for final action.
c. Flowline and Intra-Facility Gathering Line Maintenance Program
    EPA recognizes that a contingency plan provides environmental
protection in response to a discharge, but in order to implement such a
plan, a discharge detection mechanism is necessary. Furthermore, EPA
believes that with the elimination of the requirement for secondary
containment, it is important to provide more prescriptive requirements
for discharge prevention to ensure the integrity of the primary
containment of the pipe. EPA believes that a strong program of flowline
or intra-facility gathering line maintenance will provide additional
preventative measures for these pipelines and increase discharge
detection ability.
    The current SPCC requirement to have a program of flowline
maintenance, found at Sec.  112.9(d)(3), is general in nature and
offers the facility owner/operator a great deal of discretion in
determining how best to prevent discharges from each flowline. The
regulated community has expressed its desire for guidance on how to
develop such a program. At this time, EPA is not aware of any industry
standard for flowline maintenance. In the SPCC Guidance for Regional
Inspectors (version 1.0, November 28, 2005), EPA provides a description
of the elements that a comprehensive piping maintenance program should
include, based on practices recommended by industry groups.
    As stated in the SPCC Guidance for Regional Inspectors, a flowline
maintenance program aims to manage the oil production operations in a
manner that reduces the potential for a discharge. Common causes of
such discharges include mechanical damage (e.g., impact, rupture) and
corrosion. A maintenance program usually combines careful
configuration, inspection, and ongoing maintenance of flowlines and
associated equipment to prevent and mitigate a potential discharge.
    EPA is now proposing to move the requirement for a flowline
maintenance program to Sec.  112.9(d)(4), add specificity to the
provision, and to clarify that the requirement applies to intra-
facility gathering lines, as well as flowlines at an oil production
facility. Intra-facility

[[Page 58408]]

gathering lines pose the same potential for discharge as flowlines; EPA
never intended to regulate the two types of piping differently.
    EPA proposes Sec.  112.9(d)(4) to require a performance-based
program of flowline/intra-facility gathering line maintenance that
addresses the facility owner/operator's procedures, and is documented
in the SPCC Plan, to:
     Ensure that flowlines and intra-facility gathering lines
and associated valves and equipment are compatible with the type of
production fluids and their potential corrosivity, volume, and
pressure, and other conditions expected in the operational environment.
This preventative measure is intended to help preserve the integrity of
the lines and reduce the potential effects of corrosion or other
factors that may lead to a discharge.
     Visually inspect and/or test flowlines and intra-facility
gathering lines and associated appurtenances on a periodic and regular
schedule for leaks, oil discharges, corrosion, or other conditions that
could lead to a discharge as described in Sec.  112.1(b). The frequency
and type of testing must allow for the implementation of a contingency
plan as described under 40 CFR part 109. This measure is intended to
ensure that any discharges, potential problems or conditions related to
the flowline/intra-facility gathering line that could lead to a
discharge will be promptly discovered; the Agency believes that an oil
spill contingency plan cannot be effective unless the discharge is
discovered in a timely manner so that the oil discharge response
operations described in the contingency plan may be implemented. The
proposed inspection requirements are consistent with the requirements
for aboveground valves, piping, and appurtenances at non-production
facilities under Sec.  112.8(d)(4), which include regular inspection
and assessment of the general condition of associated appurtenances
such as flange joints, expansion joints, valve glands and bodies, catch
pans, pipeline supports, valve locks, and metal supports. The Agency
notes that due to changes in flowrates and corrosivity of production
fluids over time in an oil field, the frequency of inspection may need
to change over the lifetime of the well in order to prevent discharges.
For buried piping, a facility owner or operator would develop an
inspection program to identify evidence of leaks at the surface or
other conditions that which may lead to a discharge to navigable waters
or adjoining shorelines.
     Take corrective action or make repairs to any flowlines
and intra-facility gathering lines and associated appurtenances as
indicated by regularly scheduled visual inspections, tests, or evidence
of a discharge. EPA intends for this proposed requirement to be
implemented in conjunction with the proposed requirement for periodic
inspection and testing; the results of the inspection or test would
inform the owner/operator of any corrections or repairs that need to be
made. Corrective action is necessary in order to prevent a discharge
from occurring, as well as in response to a discharge. This measure is
intended to prevent discharges as described in Sec.  112.1(b) by ensuring 
that flowlines and intra-facility gathering lines are well maintained.
     Promptly remove any accumulations of oil discharges
associated with flowlines, intra-facility gathering lines, and
associated appurtenances. EPA recognizes the importance of removing oil
accumulations to prevent a discharge as described in Sec.  112.1(b).
Section 311(j)(1)(C) of the CWA provides EPA with the authority to
establish procedures, methods, and equipment and other requirements to
prevent discharges of oil from onshore and offshore facilities. EPA
considers the removal of oil-contaminated soil as a method to prevent
oil from becoming a discharge as described in Sec.  112.1(b). Disposal
of oil must be in accordance with applicable Federal, State, and local
requirements; under Sec.  112.7(a)(3)(v), a facility owner or operator
is required to describe the methods of disposal of recovered materials
in accordance with applicable legal requirements. For the purposes of
this provision, removal of recoverable oil may be combined with
physical, chemical, and/or biological treatment methods to address any
residual oil. These treatment methods must be consistent with other
Federal, state or local requirements as applicable, and must be
properly managed to prevent a discharge as described in Sec.  112.1(b).
    Consistent with the current flowline maintenance program
requirements, the proposed amendments to the maintenance program
requirements would be subject to the environmental equivalence
provision found at Sec.  112.7(a)(2). That is, the facility owner/
operator may deviate from the requirements if an environmentally
equivalent alternate measure is implemented instead. EPA recognizes
that other Federal or State requirements may be environmentally
equivalent to certain SPCC requirements, including the proposed
flowline and intra-facility gathering line maintenance program
requirement. An environmental equivalence determination is subject to
review and certification by a PE. A Tier I qualified facility, as
described in this proposal, would not be able to use environmentally
equivalent measures and therefore would need to comply with the
flowline/intra-facility gathering line maintenance program requirements
as outlined above.
    While no industry standard for a flowline or intra-facility
gathering line maintenance program currently exists, EPA acknowledges
that in the future, an industry standard may be established. If such an
industry standard is developed, the certifying PE would be able
consider whether compliance with that standard is environmentally
equivalent to the requirements of the proposed Sec.  112.9(d)(4).
Additionally, for a facility owner/operator that has installed, or
chooses to install, secondary containment systems for flowlines or
intra-facility gathering lines, such measures are likely to be
considered environmentally equivalent to one or more of the proposed
maintenance program requirements.
    Additionally, EPA acknowledges that given the characteristics of
certain intra-facility gathering lines, these pipelines may be
regulated under requirements of both EPA and DOT. Because DOT
requirements for pipelines may be similar in purpose and scope, EPA
recognizes that compliance with DOT requirements (e.g., 49 CFR part
195) for these gathering lines may be considered by the certifying PE
to be environmentally equivalent alternatives to certain SPCC
requirements associated with oil production facility piping.
    Similarly, EPA recognizes that state requirements governing
flowlines and gathering lines may be environmentally equivalent to
certain SPCC requirements applicable to flowlines and gathering lines.
In accordance with the Memorandum of Understanding between the
Interstate Oil and Gas Compact Commission and the U.S. Environmental
Protection Agency, signed in 2002, and renewed in 2005 and 2007, the
Agency intends to continue regulatory cooperation among the states and
EPA that promotes protection of the environment in a cost-effective
manner, and minimizes duplication.
    EPA requests comments on whether the proposed requirements for a
flowline/intra-facility gathering line maintenance program are
appropriate, and whether the proposed requirements conflict with state
regulatory requirements. Any suggestions must include an appropriate
rationale and

[[Page 58409]]

supporting data in order for the Agency to be able to consider it for
final action.
d. Alternative Options Considered
    EPA considered other options to address the impracticability of
secondary containment for flowlines and intra-facility gathering lines.
EPA considered allowing a contingency plan and strengthened maintenance
program requirements as an optional alternative to secondary
containment. That is, the secondary containment requirement would
remain as a compliance option. This would provide additional
flexibility. EPA concluded, however, that since secondary containment
for flowlines/intra-facility gathering lines is, in most cases,
impracticable and few oil production facilities are likely to use this
measure, providing an optional alternative could potentially increase
confusion regarding the requirements for these lines. EPA recognizes
that given the long lengths and placement of flowlines and intra-
facility gathering lines, and the cost of secondary containment for
these lines, facilities are more likely to choose a contingency plan
with inspection requirements.
    The Agency also considered taking no action for flowlines and
intra-facility gathering lines, because the owner or operator of an oil
production facility already has the ability to determine that secondary
containment is impracticable under Sec.  112.7(d). However, EPA
recognizes that in most cases secondary containment is impracticable
for this type of equipment.
    For these reasons, the Agency decided to propose an alternative for
secondary containment for flowlines and intra-facility gathering lines.
The Agency welcomes comments on these or other alternatives. Any
suggestions must include an appropriate rationale and supporting data
in order for the Agency to be able to consider it for final action.
4. Flow-Through Process Vessels
    Separation and treating installations at an oil production facility
typically include equipment whose primary purpose is to separate the
well fluid into its marketable or waste fractions (e.g., oil, gas,
wastewater, and solids), and to treat the crude oil as needed for
further storage and shipping. Under the current SPCC requirements,
separation and treatment equipment are required to have sized secondary
containment for the entire capacity of the largest single container and
sufficient freeboard to contain precipitation (Sec.  112.9(c)(2)). EPA
recognizes that similar flow-through process equipment (i.e., oil-
filled manufacturing equipment, such as reaction vessels, fermentors,
high pressure vessels, mixing tanks, dryers, heat exchangers, and
distillation columns) at a non-production facility is not subject to
the more stringent sized secondary containment and inspection
requirements required for bulk storage containers; only the general
secondary containment requirements at Sec.  112.7(c) apply (71 FR
77276, December 26, 2006). In addition, EPA acknowledges concern among
the regulated community regarding the requirement to provide sized
secondary containment around heater-treaters, due to a potential fire-
hazard if spilled oil collects around the equipment. As a result, EPA
is proposing to exempt flow-through process vessels at an oil
production facility from the sized secondary containment requirements.
However, EPA recognizes that process equipment at a non-production
facility, such as at a manufacturing facility, is typically attended
during hours of operation. Therefore, there is a greater potential to
immediately discover and correct a discharge at a non-production
facility than at an oil production facility, which is generally
unattended. For this reason, EPA is also proposing to require the
inspection of flow-through process vessel components; prompt removal of
any oil accumulations, and corrective action should a discharge occur.
a. Examples of Flow-Through Process Vessels
    Flow-through process vessels, such as horizontal or vertical
separation vessels (e.g., heater-treater, free-water knockout, gun-
barrel, etc.), have the primary purpose of separating the oil from
other fractions (water and/or gas) and sending the fluid streams to the
appropriate container. It is the intended use of this equipment that
differentiates flow-through process vessels from bulk storage
containers and end-use storage containers, such as produced water
containers. Produced water containers store well fluids (which may also
contain various amounts of oil) after they have been separated and/or
treated, prior to disposal or reinjection. Under this proposal,
produced water containers are not considered flow-through process
vessels; they continue to be considered bulk storage containers if oil
is present.
b. Exemption From Sized Secondary Containment Requirements for Flow-
Through Process Vessels
    EPA proposes to amend the requirements in Sec.  112.9(c)(2) as
follows: ``Construct all tank battery, separation, and treating
facility installations, except for flow-through process vessels so that
you provide a secondary means of containment for the entire capacity of
the largest single container and sufficient freeboard to contain
precipitation.'' This proposed amendment removes the requirement to
provide such sized containment for flow-through process vessels without
making an impracticability determination. The general secondary
containment requirement of Sec.  112.7(c) would still apply to flow-
through process vessels; they must be provided with secondary
containment so that any discharge does not escape the containment
system before cleanup occurs.
    Many oil production facilities currently provide secondary
containment berms around the entire tank battery, which includes
separators and other treatment installations, including flow-through
process vessels, along with oil stock tanks and other bulk storage
containers. Such a facility design is appropriate and EPA encourages
oil production facility owners and operators to continue this practice
to provide the maximum environmental protection. However, under this
proposal, it would no longer be necessary to locate flow-through
process vessels within a secondary containment system sized for the
entire capacity of the largest single container and sufficient
freeboard to contain precipitation.
    The Agency requests comments on the proposal to exempt flow-through
process vessels from the sized secondary containment requirements. Any
suggestions must include an appropriate rationale and supporting data
in order for the Agency to be able to consider it for final action.
c. Additional Requirements for Flow-Through Process Vessels
    Because oil production facilities are typically unattended during
the hours of operation, EPA is also proposing to add a provision at
Sec.  112.9(c)(5)(i) through (iii) to provide additional requirements
for flow-through process vessels. These additional requirements would
include periodic inspection and/or testing, corrective action, and
prompt removal of any oil accumulations.
    The proposed amendment to require periodic inspection and/or
testing of the flow-through process vessels and associated
appurtenances on a regular schedule for leaks, corrosion, or other
conditions that could lead to a discharge as described in Sec. 
112.1(b) is intended to increase the likelihood that a discharge will
be prevented or detected promptly, especially for components such as
dump valves, that typically cause spills.

[[Page 58410]]

The proposed inspection and/or testing requirements for flow-through
process vessels are consistent with the inspection requirements for
bulk storage containers under Sec.  112.9(c)(3). EPA recognizes that
because oil production facilities are typically unattended and remote
and have a constant flow of oil and well fluids, sized secondary
containment measures provide environmental protection for any potential
discharge. Because EPA is proposing that this equipment be subject to
the general secondary containment requirement (Sec.  112.7(c)) instead
of sized secondary containment, EPA seeks to ensure that any leak, or
potential for a leak, is detected promptly enough to prevent a
discharge of the entire contents of the separation or treating equipment.
    EPA is also proposing to require the owner/operator of an oil
production facility to correct or repair the flow-through process
vessels and any associated components as indicated by regularly
scheduled inspections or tests. EPA intends for this proposed
requirement to be implemented in conjunction with the proposed
requirement for periodic inspection and testing; the results of the
inspection or test would inform the owner/operator of any corrections
or repairs that need to be made. Corrective action is necessary in
order to prevent a discharge from occurring, as well as in response to
a discharge. This measure is intended to prevent discharges as
described in Sec.  112.1(b) by ensuring that separation and treatment
equipment are well maintained.
    EPA also proposes to require prompt removal upon discovery of any
spills, discharges, or accumulations of oil associated with the flow-
through process vessels. EPA considers the removal of oil-contaminated
soil as a method to prevent oil from becoming a discharge as described
in Sec.  112.1(b). Disposal of oil must be in accordance with
applicable Federal, state, and local requirements; under Sec. 
112.7(a)(3)(v), a facility owner or operator is required to describe
the methods of disposal of recovered materials in accordance with
applicable legal requirements. For the purposes of this provision,
removal of recoverable oil may be combined with physical, chemical,
and/or biological treatment methods to address any residual oil. These
treatment methods must be consistent with other Federal, state or local
requirements as applicable, and must be properly managed to prevent a
discharge as described in Sec.  112.1(b).
    The Agency requests comments on these proposed additional
requirements (inspections, corrective action, and prompt removal of oil
discharges) for flow-through process vessels. EPA also requests
comments on whether this approach, a general secondary containment
requirement and additional requirements for flow-through process
vessels should be an optional compliance alternative, in lieu of sized
secondary containment. Under an optional approach, a facility owner or
operator could choose whether to provide sized secondary containment
for flow-through process vessels, or to provide general containment and
comply with the additional requirements. (A facility owner or operator
who already provides sized secondary containment for his flow-through
process vessels would not be required to comply with the additional
requirements, as long as he maintains the sized secondary containment.)
Any suggestions must include an appropriate rationale and supporting
data in order for the Agency to be able to consider it for final action.
d. Secondary Containment Requirements for Flow-Through Process Vessels
if Facility Experiences Reportable Discharge
    EPA also is proposing a provision at Sec.  112.9(c)(5)(iv) stating
that if an oil production facility has discharged more than 1,000 U.S.
gallons of oil in a single discharge as described in Sec.  112.1(b), or
discharged more than 42 U.S. gallons of oil in each of two discharges
as described in Sec.  112.1(b), occurring within any twelve month
period, from a flow-through process vessel, then the facility owner or
operator must provide sized secondary containment for all flow-through
process vessels at the facility within six months from the discovery of
the spill(s). When determining spill history, the gallon amount
specified in the criterion (either 1,000 or 42) refers to the amount of
oil that actually reaches navigable waters or adjoining shorelines, or
in connection with specified activities in waters and not the total
amount of oil spilled. Discharges as described in Sec.  112.1(b) that
are the result of natural disasters, acts of war, or terrorism would
not be considered toward this requirement.
    The discharge criterion proposed in this notice is similar to the
provision in Sec.  112.4(a) for discharges that must be reported to the
EPA Regional Administrator (RA). Under Sec.  112.4, a facility owner or
operator must report certain information to EPA whenever the facility
experiences a discharge reportable under Sec.  112.4.
    The Agency requests comment on the proposed requirement for
providing sized secondary containment for flow-through process vessels
following a reportable discharge as described above. EPA also requests
comments on whether a facility owner or operator who experiences such a
discharge and subsequently provides sized secondary containment for
separation and treating facility equipment at the facility should
continue to be required to comply with the additional requirements
described above (proposed as Sec.  112.9(c)(5)(i) through (iii)). Any
suggestions must include an appropriate rationale and supporting data
in order for the Agency to be able to consider it for final action.
e. Alternative Option Considered
    EPA considered another option to address secondary containment for
flow-through process vessels. Under this option, EPA would allow a
contingency plan and written commitment of manpower, equipment, and
materials required to expeditiously control and remove any quantity of
oil discharged that may be harmful, without the need to develop a
written impracticability determination as an optional alternative to
all secondary containment requirements for flow-through process
vessels. This option would be available for eligible flow-through
process vessels: those that have had no discharges of oil reportable to
EPA under Sec.  112.4 in the past three years. In addition, this option
would require a facility owner or operator to conduct periodic
integrity testing of the process vessels and periodic integrity and
leak testing of the associated valves and piping.
    EPA recognizes that this alternative to secondary containment would
provide flexibility. However, EPA also recognizes that a typical oil
production facility is remote and/or unattended, and therefore
secondary containment is a preferable measure to prevent a discharge to
navigable waters or adjoining shorelines in the event of an oil spill
than a contingency plan. Some form of general secondary containment is
practicable for this type of equipment. Therefore, EPA chose not to
propose this option.
    The Agency welcomes comments on this alternative or other
alternatives to address separation and treatment equipment, while
maintaining environmental protection. Any suggestions must include an
appropriate rationale and supporting data in order for the Agency to be
able to consider it for final action.
5. Small Oil Production Facilities
    In this proposed rule, EPA has included a number of amendments to

[[Page 58411]]

the SPCC requirements that are designed to reduce the burden on oil
production facilities, while maintaining protection of the environment.
Specifically, EPA is proposing to amend the definition of ``facility''
to clarify the flexibility associated with defining a facility's
boundaries; exclude oil production facilities from the loading/
unloading rack requirements at Sec.  112.7(h); extend the timeframe by
which a new oil production facility must prepare and implement an SPCC
Plan; exempt flowlines and intra-facility gathering lines at oil
production facilities from all secondary containment requirements,
while establishing requirements for a flowline/intra-facility gathering
line maintenance program and contingency planning; exempt flow-through
process vessels at oil production facilities from the sized secondary
containment requirements, while maintaining general secondary
containment requirements and requiring additional oil spill prevention
measures; clarify the applicability of the rule to containers at a
natural gas facility; and clarify the definition of ``permanently
closed'' as it applies to an oil production facility. In addition, the
Agency is taking comment on a number of approaches regarding the
management of produced waters at oil production facilities.
    The regulated community has expressed particular concern regarding
the regulation of small oil production facilities under the SPCC rule,
suggesting that the cost of complying with the SPCC requirements is
disproportionate to the risk these small facilities pose to the
environment. While EPA is sensitive to these concerns, the Agency
believes that spills from small oil production facilities have and can
continue to pose a threat of an oil discharge to navigable waters and
adjoining shorelines, and that smaller oil production facilities should
remain subject to the SPCC rule.
    In evaluating the appropriate application of the SPCC rules to
these facilities, the Agency is guided by Executive Order 13211, which
directs federal agencies to evaluate and respond to effects that
governmental regulatory action can have on the supply of energy
(Executive Order 13211 of May 18, 2001, ``Actions Concerning
Regulations That Significantly Affect Energy Supply, Distribution, or Use,'' 
(66 FR 28355, May 22, 2001)).\3\ Accordingly, the Agency
believes it is appropriate to consider the impacts of existing
regulations on the energy sector and to identify regulatory
alternatives that reduce those impacts when implementing the statutory
authorization of Section 311(j)(1)(C) of the Clean Water Act at oil
production facilities.
---------------------------------------------------------------------------

    \3\ The overall effect of the proposed rule is to decrease the
regulatory burden on facility owners or operators subject to its
provisions. Accordingly, the proposed rule is not a ``significant
energy action'' as defined in this Executive Order.
---------------------------------------------------------------------------

    While assessing opportunities for tailoring and streamlining the
SPCC requirements, EPA considered whether there are alternative
regulatory approaches to Section 311(j)(1)(C) for small oil production
facilities that would further reduce the compliance burden associated
with the current rule requirements, while still maintaining protection
of human health and the environment. In particular, EPA considered
regulatory alternatives for oil production facilities that have wells
that produce 10 barrels or less of crude oil per day and are known as
``stripper wells.'' \4\
---------------------------------------------------------------------------

    \4\ EPA established differentiated requirements for ``stripper
wells'' under the Clean Water Act and codified it in 1979. See 40
CFR 435.60. See also Interstate Oil and Gas Compact Commission,
2006: ``Marginal Wells: Fuels for Economic Growth'', p. 4 (defining
``stripper wells'' as wells that produce 10 barrels of oil per day
or less).
---------------------------------------------------------------------------

    The owner or operator of an oil production facility generally
provides adequate container capacity at his facility to ensure sound
and continuous operations, and so that a container will not overfill if
there is a delay in the removal of oil from the tanks. This practice
would meet the SPCC rule provisions at Sec.  112.9(c)(4) to prevent
overfills from the containers. However, this practice may prevent some
small oil production facilities from being eligible for the burden
reduction available to qualified facilities because they would likely
have greater than 10,000 gallons in aggregate aboveground oil storage
capacity. Therefore, the Agency is requesting comment on an approach
described below that identifies specific criteria for an oil production
facility that produces oil from a limited number of stripper wells to
be considered a qualified facility, notwithstanding the tank storage
capacity at the facility. The approach has been shaped by the specific
characteristics of this category of facilities and, as such, could
result in the application of SPCC requirements in a manner better
suited to these facilities. In addition, the Agency is also requesting
comment on some additional options for reducing the burden on small oil
production facilities that have been suggested by the Department of
Energy (DOE). Following consideration of public comments received in
response to this notice, one or more of these approaches may be
finalized as the applicable SPCC requirements for these facilities.
Commenters may provide input on variations to these approaches for
consideration by the Agency.
a. Alternative Qualified Facility Eligibility Criteria for Oil
Production Facilities
    This approach is intended as an alternative for oil production
facilities to be considered qualified facilities because they do not
meet the current qualified facility requirements under 40 CFR 112.3(g).
Under this alternative, an oil production facility would be eligible as
a qualified facility if it meets the following criteria: (1) The oil
production facility must have no more than four wells associated with a
single tank battery; (2) all four of the wells must be stripper wells
each producing 10 barrels or less of crude oil per day--that is, a tank
battery at an oil production facility could not include any non-
stripper wells under this option; (3) the facility must have no
injection wells; and (4) the facility must not have had a single
discharge exceeding 1,000 U.S. gallons or two discharges each exceeding
42 U.S. gallons within any twelve month period in the three years prior
to Plan certification. Discharges as described in Sec.  112.1(b) that
are the result of natural disasters, acts of war, or terrorism will not
disqualify a facility owner or operator from the alternative option
described above. The owner or operator of an oil production facility
could avail himself of the streamlined requirements for a ``qualified
facility'' at Sec.  112.6, if the facility meets all four of the
proposed criteria, notwithstanding the total aboveground oil storage
capacity at the facility. That is, a qualified facility owner/operator
would have the option to prepare a self-certified SPCC Plan in lieu of
a Plan certified by a PE. An oil production facility owner or operator
exercising this option may be required to make available production or
shipping records to support his eligibility. Records may be kept under
usual and customary business practices, and must be kept for a period
of three years, in accordance with Sec.  112.7(e).
    EPA based this potential qualified production facility approach on
input from the oil production sector regarding concerns for the burden
of preparation of a PE-certified Plan for small oil producers. As
stated above, EPA notes that this option would be available to those
oil production facilities with up to four stripper wells per tank
battery; each well producing 10 barrels or less of crude oil per day;
and no injection wells or other wells associated with secondary or
tertiary recovery techniques. EPA is

[[Page 58412]]

considering a maximum of four wells per tank battery in identifying a
``qualified oil production facility'' based on discussions with EPA
regional personnel and the Texas Railroad Commission who suggest that
this number of wells is fairly typical of oil production facilities.\5\
EPA, therefore, believes that the maximum of four stripper wells per
tank battery adequately captures the smaller operators targeted by the
self-certification option. EPA believes that these facilities are less
complex than other oil production facilities based on the limited
number of wells per tank battery operating at a low flow rate.
---------------------------------------------------------------------------

    \5\ EPA assumed an average of four wells per tank battery at a
facility to estimate the number of oil production facilities that
are subject to the SPCC requirements (see Regulatory Impact Analysis
for the Proposed Amendments to the Oil Pollution Prevention
Regulations). DOE also conducted an analysis of the impact of the
SPCC rule on the oil production sector and assumed an average of
three stripper wells per oil production facility.
---------------------------------------------------------------------------

    As discussed in the preamble to the December 2006 rule amendments,
in which EPA finalized the qualified facility approach, the basis for
the exemption from the requirement for a PE certification is that
facilities with smaller oil volumes tend to be less complex (71 FR
77270, December 26, 2006). The Agency believes that a facility meeting
the potential criteria for a ``qualified oil production facility'' as
described above (i.e., no more than four stripper wells to one tank
battery, no injection wells, and meets the current spill history
criterion for qualified facilities) would be less complex than other
oil production facilities for the following reasons. At oil production
facilities with no more than four wells per tank battery, the flowlines
and the stripper well(s) are commonly co-located within the immediate
area of the tank battery therefore reducing the length of flowlines.
Additionally, it is likely that an oil production facility that meets
the proposed qualification criteria would have fewer valves, less
piping, smaller separation equipment, and fewer locations where
transfers and discharges could occur because there are fewer wells
associated with one tank battery.
    The underground injection process adds complexity to the design of
an oil production facility; consequently, EPA has included a ``no
injection wells'' criterion for an oil production facility to qualify
for this alternative option. The injection well process adds complexity
because the flowlines from a produced water container to the injection
wellhead adds valves, pumps and piping to the facility. In addition,
the produced water tanks associated with injection may have high level
indicators, floats and actuators/switches that further add complexity.
At small production facilities, these systems may not be automated due
to cost. The design of the production facility is based on the ability
to inject the produced water; generally no extra storage capacity is
available to contain fluids if there is a failure or system upset. This
leads to a greater likelihood of a discharge. Finally, the water in the
produced oil/water mixture is usually corrosive, especially if it is
saline, leading to a greater potential for discharge from injection
equipment as a result of this corrosion which would be present at more
complex facilities.
    This alternative set of criteria for identifying a qualified oil
production facility would only be available to oil production
facilities, and not oil drilling or workover facilities. Due to the
nature of its operations, a drilling facility has not yet established
an oil production flow rate, and thus a well at such a facility cannot
be determined to meet the definition of a ``stripper well.'' However,
the owner/operator of an oil drilling and/or workover facility
considers the capacity of oil that is maintained for his operations to
determine applicability of the SPCC rule and therefore may still be
eligible for qualified facility status based on the current criteria in
Sec.  112.3(g), i.e., the 10,000-gallon total facility oil storage
capacity threshold and discharge history criteria.
    It should also be noted that under the current regulations, the
owner or operator of an oil production facility can make a
determination that sized secondary containment is impracticable. The
owner or operator of an oil production facility that meets the proposed
criteria for a Tier II qualified facility (as described elsewhere in
this proposed rulemaking) would still be able to determine that
secondary containment is impracticable and implement the alternative
measures under Sec.  112.7(d) (i.e., develop a contingency plan and a
written commitment of resources and conduct integrity testing of the
bulk storage container and associated piping) if a PE certifies that
the secondary containment is impracticable, under the ``hybrid''
approach in which a PE certifies a portion of the SPCC Plan.
    EPA is requesting comment on this approach, including the specific
criteria identified and whether changes to these criteria would
properly assess the complexity of such small oil production facilities.
This proposed action may provide a reduction in regulatory burden to
those oil production facilities with no more than four stripper
extraction wells per tank battery that nonetheless is likely to exceed
the current qualified facility threshold criterion of 10,000 gallons.
For example, the difference in compliance costs between an oil
production facility that prepares an SPCC Plan requiring PE-
certification and one that can be self-certified is about $950.
    EPA is also requesting comment on whether a small oil production
facility may be further eligible for the Tier I qualified facility
status, as described elsewhere in today's preamble, if the facility
meets the criterion proposed in the rulemaking for a Tier I qualified
facility--i.e., the facility has no oil storage containers with an
individual storage capacity greater than 5,000 gallons, notwithstanding
the total aboveground oil storage capacity at the facility. That is, at
a Tier I oil production qualified facility, the owner or operator could
avail himself of the streamlined Tier I Qualified Facility SPCC Plan
template, as found in the proposed Appendix G to the SPCC rule. An
owner or operator of an oil production facility qualifying for and
opting to use the Tier I Qualified Facility SPCC Plan template would
not be able to make an impracticability determination for secondary
containment requirements. Instead, the owner or operator may choose the
Tier II approach and develop a ``hybrid'' Plan in which the P.E.
certifies the portion of the Plan pertaining to impracticability of
secondary containment.
    Finally, the Agency specifically solicits comment on the number of
oil production facilities that would be able to take advantage of this
approach.
b. Alternative Approaches for Addressing Small Oil Production
Facilities as Suggested by the Department of Energy (DOE)
    The Department of Energy (DOE) requested that the Agency seek input
on several approaches that DOE believes may be more suited to address
the concerns of small oil production facilities. One approach would
have different eligibility criteria to enable the owner or operator of
a small oil production facility to be considered a ``qualified
facility'' under Sec.  112.6, and allow for the development of a self-
certified SPCC Plan, or a ``Tier I Qualified Facility,'' and allow the
use of a streamlined SPCC Plan template, similar to that found in the
proposed Appendix G to the SPCC rule. Under the existing qualified
facilities criteria at Sec.  112.3(g), a facility that has an

[[Page 58413]]

aggregate aboveground storage capacity of 10,000 gallons or less and
has not had a single discharge exceeding 1,000 U.S. gallons or two
discharges each exceeding 42 U.S. gallons within any twelve-month
period in the three years prior is eligible for the qualified facility
Plan requirements at Sec.  112.6 (i.e., a self-certified Plan in lieu
of a PE certified Plan). DOE suggests that because of the unique
characteristics of small oil production facility operations, such
facilities may merit the establishment of small oil production
facility-specific eligibility criteria, including a different aggregate
oil storage capacity threshold \6\ or stripper well definition \7\ for
identifying qualified facilities. In light of this request, EPA seeks
comment on whether there are unique circumstances at small or
marginally economic oil production facilities and the alternative
criteria based on these circumstances for the possible establishment of
a ``qualified facility'' provision specific to small oil production
facilities that would serve to increase SPCC compliance and reduce the
likelihood of a harmful oil discharge. Any alternative approaches
submitted must include an appropriate rationale in order for the Agency
to be able to consider it for final action.
---------------------------------------------------------------------------

    \6\ The Oklahoma Independent Petroleum Association and the
Independent Petroleum Association of America suggest an aggregate
oil capacity threshold of 50,000 gallons.
    \7\ DOE suggests that a stripper well be defined using the
Internal Revenue Service (IRS) tax code definition of 15 barrels or
less of oil per day equivalence (see 26 U.S.C. 613A).
---------------------------------------------------------------------------

    The other approach DOE requested that EPA take comment on is to
outright exempt existing stripper oil and natural gas wells from all
SPCC requirements, except those applicable to crude oil and condensate
tanks (e.g., tanks which store gas condensate (which is an oil) at oil
and gas production facilities). The eligibility criteria for the
exemption would include those facilities that meet the Internal Revenue
Service (IRS) Tax Code definition of stripper well property at 26
U.S.C. 613A, which defines a stripper well property, with respect to
any calendar year, as any property producing 15 barrel equivalents or
less per day, where this rate is calculated by dividing:
    (i) The average daily production of domestic crude oil and domestic
natural gas from producing wells on such property for such calendar
year, by
    (ii) The number of such wells.
    DOE, states and industry have raised concerns that the SPCC
regulation has the potential to result in the premature abandonment of
stripper wells. They argue that stripper wells are marginally economic
and can be particularly burdened by increased regulatory compliance and
other operating costs. These wells are often operated by small
independent producers in mature oil and gas producing regions, have low
oil productivity and low oil volumes, and thus could be viewed as
presenting a low oil spill risk. According to DOE, stripper wells are
vital to sustaining production from conventional oil and natural gas
resources in the United States. More than 321 million barrels of oil
and 1.7 trillion cubic feet of natural gas were produced from stripper
wells in 2005, representing 17 percent of domestic oil production and 9
percent of domestic natural gas production respectively. The Interstate
Oil and Gas Compact Commission has estimated that if oil production
from stripper wells active in 2005 did not exist, imports would have to
increase 6.7 percent to make up for this shortage.\8\
---------------------------------------------------------------------------

    \8\ See Interstate Oil and Gas Compact Commission, 2006:
``Marginal Wells: Fuels for Economic Growth.''
---------------------------------------------------------------------------

    Eligibility criteria for relief would not be limited to the
presence of injection wells or the use of secondary and tertiary
recovery techniques which are common in more mature oil and gas
producing regions. DOE has commented that such criteria have no direct
relationship to the spill risk posed by marginal well facilities and
may serve as a disincentive to enhanced oil and gas recovery and well
maintenance. Production and injection operations for disposal or
enhanced recovery may be regulated under existing Federal and State
regulatory programs, e.g., under Clean Water Act NPDES, Safe Drinking
Water Act underground injection control, and state production or
environmental permits to reduce or manage pollutants that could be
introduced into the environment. For NPDES and underground injection
control, these regulatory programs are intended to address the
discharge of known pollutants that are to be introduced to navigable
waters (in the case of NPDES) or to underground sources of drinking
water (in the case of UIC). In contrast to these measures, SPCC is
designed to prevent the non-routine accidental discharge of oil that
might be held in an oil container at a facility. DOE has suggested that
these regulations may accomplish certain SPCC objectives in a different
manner, such as prohibiting pollution or unlawful discharges rather
than requiring an SPCC Plan. Therefore, the Agency specifically
solicits comment on the extent that these regulatory programs,
particularly state production or environmental permits, address the
objectives of the SPCC rules, and if so, how they are achieved.
Finally, EPA would note that under this approach, new facilities and
existing non-marginal facilities would not be exempted from the SPCC
regulation, but once their production declines below the marginal level
as defined above, these wells would be excluded from continuing or
periodic SPCC requirements under this approach.
    EPA requests comments on the scope of a stripper well exemption,
including the eligibility criteria, and whether such an exemption can
reduce the regulatory burden on marginally economic properties while
protecting the environment. Any alternative approaches must include an
appropriate rationale and supporting data in order for the Agency to be
able to consider these for a final action.
6. Produced Water Storage Containers
    At an oil or natural gas production facility, ``produced water'' is
the oil and water mixture resulting from the separation of marketable
crude oil from the fluid extracted from the geological formation.
Produced water chemical and physical characteristics vary considerably
depending on the geologic formation, usually being commingled with oil
and gas at the wellhead, and changing in composition as the oil or
natural gas fraction is separated and sent to market. The management of
produced water may typically entail the use of separation and treatment
process vessels, tanks both near the point of separation and at the
point of its disposal or reuse (e.g., in an injection well for disposal
or enhanced oil recovery, discharge to a stream, or agricultural water
resource), and flowlines and gathering lines.
    In the current SPCC rule, the term ``bulk storage container'' is
defined as ``any container used to store oil.'' EPA considers a
produced water container that also contains oil to be a bulk storage
container, and therefore subject to applicable provisions under Sec. 
112.9(c). Produced water containers are typically located within a tank
battery at a production facility where they are used to store well
fluids after separation and prior to subsequent use (e.g., re-injection
or re-use), further treatment, or disposal. Because the separation
process is not completely effective, under normal operating conditions,
a layer of oil may be present above the produced water in the
container. The amount of oil by volume observed in produced water
storage containers varies, but based on EPA's assessment, is generally
estimated to range from less than one to

[[Page 58414]]

up to ten percent, and can be greater. This estimate is based on a
review of National Response Center (NRC) spill reports, observations
from EPA inspectors, and comments made by industry representatives and
the accompanying document ``Consideration for the Regulation of Onshore
Oil Exploration and Production Facilities Under the Spill Prevention,
Control, and Countermeasures Regulation'' (May 30, 2007), in the docket
for today's rulemaking. The Department of Energy (DOE) and the industry
believe that the oil layer may be much less.
    Many production sites operate in geographically remote areas and
are typically unattended. At these production sites, fluids extracted
from the well flow through the production and separation equipment and
into various storage containers provided at the facility. The produced
water storage containers are usually the last containers in the
separation process stream where fluids accumulate; consequently,
produced water containers are a potential source of discharge due to
overfill when there is an upset in operations (e.g., such as separator
failure) or when an operator is delayed in making a scheduled visit to
the facility to empty the produced water containers. In an overfill
situation, the oil floating at the surface of the water may be first to
be discharged, followed by water which could serve to transport the oil
for longer distances. Oil discharges to navigable waters or adjoining
shorelines from an oil/water mixture in a produced water container may
cause harm. Such mixtures are regulated as oil under the SPCC rule.
    The regulated community has expressed concern regarding the
regulation of produced water containers under the SPCC rule, suggesting
that the cost of complying with the SPCC requirements is
disproportionate to the risk these containers pose to the environment.
For this reason, EPA is considering whether there are regulatory
options for produced water containers that can protect the environment
at lesser cost than the current rule requirements along with the
amendments proposed in this action. The Agency is requesting comments
on three options, as described below.
    EPA requests comment on the characteristics of produced water
containers at production facilities that may uniquely distinguish these
containers from containers used at other types of facilities that hold
oil mixtures. EPA also requests comment on whether the approaches
outlined below appropriately address industry concerns, while
protecting the environment. In particular, EPA requests comment on an
approach that would require general secondary containment combined with
additional requirements in lieu of sized secondary containment. A
second approach, advanced by DOE, would require inspection,
maintenance, and periodic oil skimming of produced water storage
containers in lieu of both sized and general secondary containment.
    Finally, comment is requested on whether a third approach, advanced
by DOE, that exempts produced water treatment facilities altogether
would be appropriate. In connection with this approach, the regulated
community and DOE have suggested that produced water containers should
be exempt from all SPCC requirements, arguing that these containers
have only incidental amounts of oil and a low risk of discharge.
Published data used to establish national effluent limitations for
coastal oil and gas production facilities show that the oil content of
produced water in tanks after initial separation is low, e.g.,
averaging 50 parts per million, with a maximum of 200 parts per million
in samples taken.\9\
---------------------------------------------------------------------------

    \9\ SAIC, 1993, draft ``Coastal Oil and Gas Production Sampling
Summary Report'' April 30, and SAIC 1994, ``Statistical Analysis of
Effluent from Coastal Oil and Gas Extraction Facilities'' September 30.
---------------------------------------------------------------------------

    Data EPA received in the past suggest that produced water
containers may hold up to 10% of free-phase oil floating on the surface
of the produced water. EPA is asking that commenters provide additional
data on the amount of oil commonly observed in produced water
containers. EPA is primarily interested in data on the amount of free-
phase oil present in produced water containers, for example as a layer
of oil floating at the surface of the produced water, rather than oil
present in solution, suspension or emulsion within the produced water
mixture. EPA also requests comment, and supporting data, on the
efficiency of oil and water separation and treatment at onshore
production facilities, how the efficiency of oil-water separators
changes over time as equipment ages and production of oil from the
formation evolves, the efficiency of oil skimming on oil volume, and
the frequency and consequences of equipment failure. Finally, EPA
requests data on oil spills, the source, and the cause of such oil
spills from these produced water containers.
    Any suggestions on alternative approaches must include an
appropriate rationale and information and data in order for the Agency
to be able to consider it for final action.
a. General Secondary Containment, Inspection, Integrity Testing &amp;
Maintenance of Produced Water Bulk Storage Containers
    One approach on which EPA requests comment would allow an owner/
operator of a production facility to comply with the general secondary
containment requirements along with additional measures for existing
produced water containers as an option in lieu of the current
regulatory requirement for sized secondary containment for these
containers. That is, a production facility owner/operator would provide
general secondary containment and comply with additional measures for
existing produced water containers, or the owner/operator could choose
to comply with the current sized secondary containment requirements for
produced water containers and not be subject to the new additional set
of measures. Under this approach, an owner/operator that chooses to
carry out additional measures in addition to the general secondary
containment requirement for existing produced water containers (see
Sec.  112.7(c)) would be exempted from the sized secondary containment
requirement at Sec.  112.9(c)(2). The general secondary containment
requirements (Sec.  112.7(c)) apply to all parts of a facility that
could be involved in a discharge. If an owner or operator has already
provided sized secondary containment for the facility produced water
bulk storage container, the owner or operator may choose not to select
this new option. EPA expects many operators may be in this situation,
as a recent DOE report stated that over two-thirds of produced water
tanks ``were assumed to be already contained within existing SPCC Plans
and have secondary containment.'' \10\
---------------------------------------------------------------------------

    \10\ See ``Assessment of the Potential Costs and Energy Impacts
of Spill Prevention, Control, and Countermeasure Requirements for
U.S. Oil and Natural Gas Production'' prepared for U.S. DOE Office
of Fossil Energy by Advance Resources International, Inc., August
17, 2006 (Revised). Available at 
http://www.fossil.energy.gov/programs/oilgas/publications/
environment_otherpubs/SPCC_Impact_Exploration_and_Production_8.pdf.

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

    This approach would be limited to existing produced water
containers because this approach is intended to balance the cost of
retrofitting existing containers with EPA's belief that sized secondary
containment is the most effective method to prevent oil discharges from
these containers. Existing produced water containers would be those at
oil production facilities in operation on the effective date of the
final rule addressing this approach. Newly constructed oil

[[Page 58415]]

production facilities and newly installed produced water containers at
existing facilities would not be eligible to use these alternative
measures in lieu of sized secondary containment because it is EPA's
best professional judgment that because construction crews and
equipment are already present at a facility during the installation of
new produced water containers, the incremental cost for adding/
installing sized secondary containment for these containers would not
be significant.
    In addition, if a facility experiences a discharge reportable to
EPA under Sec.  112.4, then sized and general secondary containment
would be required for all produced water containers at the facility
within six months from the discovery of the spill(s).\11\ When
determining spill history, the gallon amount specified in the criterion
(either 1,000 or 42) refers to the amount of oil that actually reaches
navigable waters or adjoining shorelines, or in connection with
specified activities in waters and not the total amount of oil spilled.
Discharges as described in Sec.  112.1(b) that are the result of
natural disasters, acts of war, or terrorism will not disqualify a
facility owner or operator from the alternative measures described above.
---------------------------------------------------------------------------

    \11\ See the similar discussion in Section V.L.4 of this
proposal pertaining to flow-through process vessels.
---------------------------------------------------------------------------

    To maintain environmental protection under this approach, the
following additional measures for produced water containers would be
required:
     Periodic inspections on a regular schedule of equipment
and appurtenances that typically cause spills from produced water
containers (e.g. piping, valves, pumps and the container itself). A
requirement for periodic inspection of the produced water containers
and associated appurtenances on a regular schedule for leaks,
corrosion, or other conditions that could lead to a discharge as
described in Sec.  112.1(b) would increase the likelihood that a
discharge will be prevented or detected promptly, especially for
appurtenances that typically cause spills. Inspection of produced water
containers and appurtenances would be consistent with the inspection
requirements for bulk storage containers under Sec.  112.9(c)(3).
Facilities would outline, in writing, procedures for routine inspection
and keep records of these inspections in accordance with Sec. 112.7(e).
     Conduct a condition examination \12\ and integrity testing
of produced water containers on a regular schedule and after completing
material repairs. In lieu of the protection offered by sized secondary
containment, this approach would require a formal integrity inspection/
condition examination of the produced water bulk storage container(s)
on a regular schedule. The frequency, inspector qualifications and the
scope of the inspections, integrity testing, and condition examinations
must be in accordance with good engineering practice and documented in
the SPCC Plan. For condition examinations and integrity testing, the
industry recommended practices for tanks in production service provide
the scope and frequency of examinations necessary to ensure the
suitability of tanks for continued service, based on the type of tank,
fluid stored, and service conditions. For an example of such practices,
a facility owner or operator may refer to American Petroleum Institute,
Recommended Practice 12R1, fifth edition, August 1997. These practices
include the routine visual operational examination of produced water
bulk storage containers by facility personnel according to written
procedures, and external and/or internal condition examination of these
same containers according to a schedule and following an operational
alert, malfunction, or other condition noted during the routine
operational examination. The external condition examination \13\ would
cover the tank exterior, and check for leaks, shell distortion, and
evidence of corrosion; it would also look at the condition of the
foundation, pad, drainage, coatings, appurtenances and connections. The
internal condition examination would check for leaks, shell distortion,
cracks, condition of any internal coating, and evidence and severity of
internal corrosion. The external and internal condition examinations
would be complemented by integrity testing (e.g., using non-destructive
evaluation methods, such as ultrasonic thickness measurements of the
shell) used to assess the suitability of the container for continued
production service, as appropriate for the type of container.
Facilities would outline in writing procedures for routine visual
examination, external condition examination, internal condition
examination, and integrity testing and keep records of the examinations
and testing in accordance with Sec.  112.7(e).
---------------------------------------------------------------------------

    \12\ ``Condition examination'' is defined in API Recommended
Practice 12R1 as a review of history and physical observation of a
tank and its adjacent equipment by a competent person.
    \13\ API Recommended Practice 12R1 provides guidelines on
developing the scope of a program for condition examination and
integrity testing for tanks at production facilities. While the RP
does not include mandatory requirements, this approach would include
a mandatory requirement to conduct a condition examination and
integrity testing for produced water containers.
---------------------------------------------------------------------------

     Prompt removal of any oil discharges from produced water
containers and appurtenances. This approach also would require prompt
removal upon discovery of any spills, discharges, or accumulations of
oil associated with the produced water containers. EPA considers the
removal of oil-contaminated soil as a method to prevent oil from
becoming a discharge as described in Sec.  112.1(b). Disposal of oil
must be in accordance with applicable Federal, State, and local
requirements; under Sec.  112.7(a)(3)(v), a facility owner or operator
is required to describe the methods of disposal of recovered materials
in accordance with applicable legal requirements. For the purposes of
this provision, removal of recoverable oil may be combined with
physical, chemical, and/or biological treatment methods to address any
residual oil. These treatment methods must be consistent with other
Federal, state or local requirements as applicable, and must be
properly managed to prevent a discharge as described in Sec.  112.1(b).
     Corrective action to repair or replace any container, or
associated equipment and appurtenances in order to prevent a discharge
from occurring, as well as in response to a discharge. Finally, this
approach would require the owner/operator of an oil production facility
to take corrective action to repair any produced water container, and
associated equipment and appurtenances as indicated by regularly
scheduled inspections or tests. This requirement could be implemented
in conjunction with the requirement for periodic inspection and
testing; the results of the inspection or test would inform the owner/
operator of any corrections or repairs that need to be made. Corrective
action is necessary in order to prevent a discharge from occurring, as
well as in response to a discharge. This measure would prevent
discharges as described in Sec.  112.1(b) by ensuring that produced
water containers are well maintained.
    In evaluating this potential regulatory approach, the Agency
examined oil production operations as they relate to the storage,
treatment, and handling of these oil/water mixtures. EPA conducted a
study of the exploration and production sector (see Considerations for
the Regulation of Onshore Oil Exploration and Production Facilities
Under the Spill Prevention, Control, and Countermeasure Regulation (May
30, 2007), in the docket

[[Page 58416]]

for this rulemaking). In this study, EPA reviewed the spills reported
to the National Response Center (NRC) during calendar years 2000
through 2005. The NRC spill reports specifically attribute 3% of the
spill incidents from oil production facilities to produced water
containers. Some of the spill incidents attributed to unspecified tank
batteries (4%) or unspecified tanks (6%) may also involve produced
water containers. Based on these reports, 5% of the volume of oil
spills from oil production facilities is attributed specifically to
produced water containers, 6% is attributed to unspecified tank
batteries, and 20% is attributed to unspecified tanks. The NRC reports
also attribute 3% of the spill incidents to water disposal, which is
16% of the total volume of oil and oil mixtures discharged from oil
production facilities. The NRC data does not show the ratio of oil and
water in spills. Incidents associated with water disposal may involve
produced water containers, although the review found that water
disposal piping frequently suffers from corrosion damage and accidental
impacts and incidents associated with water disposal may also be
associated with the water disposal piping. Based on the information
reported to the NRC, the most common causes of oil spill incidents from
oil production facilities were equipment failure (18%), corrosion
(20%), and leaks, holes and ruptures (20%). Twenty-four percent of the
spill reports have unspecified causes.
    Many onshore production facilities already locate produced water
containers within the same containment structure as other oil
containers, and size this containment structure to the capacity of the
largest oil container plus freeboard for precipitation. Therefore,
those oil production facilities that include sufficient containment
already meet the existing sized secondary containment requirement and
would not need to comply with these additional measures. A review of
spill incident reports from the NRC and selected state data sources
shows that containment structures are an effective means of containing
oil spills within the facility and preventing discharges to navigable
waters and adjoining shorelines.
    EPA requests comment on whether this approach, an exemption from
the sized secondary containment requirement, with additional measures
for produced water containers (including integrity testing and
condition examinations), appropriately addresses industry concerns,
while preserving environmental protection. Additionally, EPA requests
comment on whether there are other measures that should be considered
in developing this alternative approach in lieu of the sized secondary
containment requirements. Finally, as EPA previously indicated, the
Agency also requests comment on the characteristics of produced water
containers at production facilities that may uniquely distinguish these
containers from containers used at other types of facilities to hold
oil mixtures.
b. Inspection and Maintenance of Produced Water Storage Containers
    DOE has requested that EPA take comment on a second approach which
would allow an owner/operator of a production facility to comply with
additional measures for produced water storage containers in lieu of
both sized and general secondary containment requirements. That is, a
production facility owner/operator would be able to comply with these
specific tailored measures for produced water containers, or the owner/
operator could choose to comply with the current sized secondary
containment requirements for produced water containers and not be
subject to an additional set of measures. Under this approach, an
owner/operator that chose to comply with these tailored requirements
would be exempted from the sized secondary containment requirement at
Sec.  112.9(c)(2) and the general secondary containment requirements at
Sec.  112.7(c).
    However, if a facility experiences a discharge reportable to EPA
under Sec.  112.4, then sized and general secondary containment would
be required for all produced water containers at the facility within
six months from the discovery of the spill(s).\14\ When determining
spill history, the gallon amount specified in the criterion (either
1,000 or 42) refers to the amount of oil that actually reaches
navigable waters or adjoining shorelines, or in connection with
specified activities in waters and not the total amount of oil spilled.
Discharges as described in Sec.  112.1(b) that are the result of
natural disasters, acts of war, or terrorism will not disqualify a
facility owner or operator from using these tailored requirements in
lieu of sized and general secondary containment.
---------------------------------------------------------------------------

    \14\ See the similar discussion in Section V.L.4 of this
proposal pertaining to flow-through process vessels.
---------------------------------------------------------------------------

    This approach is based on input DOE received from the production
sector that suggested that an inspection and maintenance approach may
be more appropriate for these containers. Additionally, DOE believes
that the volume of oil in the storage container can be significantly
reduced further after separation by periodic skimming of the oil layer
that may reside in the top of the container.
    To maintain environmental protection under this approach, the
following additional measures for produced water containers would be
required:
     Visually inspect on a regular schedule the equipment and
appurtenances which typically cause spills from produced water
containers (e.g., piping, valves, pumps, and the container itself) to
assess the suitability of the equipment for continued service, as
appropriate for the type of fluids. Facility owners and operators must
outline in writing procedures for routine visual inspection and keep
records of these inspections in accordance with Sec.  112.7(e).
     Implement a program to periodically skim the fluids in the
produced water container as necessary to prevent an oil layer that
would increase the potential for a discharge of oil as described in
Sec.  112.1(b). The skimming program must be appropriate for the fluids
stored, the rate of production, the container size, and the facility
configuration.
     Promptly remove any oil discharges from produced water
containers and appurtenances. This approach would require prompt
removal upon discovery of any spills, discharges, or accumulations of
oil associated with produced water containers that are subject to these
tailored requirements. As noted previously, EPA considers the removal
of oil-contaminated soil as a method to prevent oil from becoming a
discharge as described in Sec.  112.1(b). Disposal of oil must be in
accordance with applicable Federal, State, and local requirements;
under Sec.  112.7(a)(3)(v), a facility owner or operator is required to
describe the methods of disposal of recovered materials in accordance
with applicable legal requirements. For the purposes of this provision,
removal of recoverable oil may be combined with physical, chemical,
and/or biological treatment methods to address any residual oil. These
treatment methods must be consistent with other Federal, State, or
local requirements as applicable, and must be properly managed to
prevent a discharge as described in Sec.  112.1(b).
     Corrective action to repair or replace any produced water
container, or associated equipment and appurtenances in order to
prevent an oil discharge from occurring, as well as in response to a
discharge. This approach would require the owner or operator of an oil
production facility to take corrective action to repair any produced
water container and associated

[[Page 58417]]

equipment or appurtenances as indicated by regularly scheduled
inspections. This requirement could be implemented in conjunction with
the requirement for periodic inspection; the results of the inspection
would inform the owner or operator of any corrections or repairs that
need to be made. Corrective action is necessary in order to prevent a
discharge from occurring, as well as in response to a discharge. This
measure is intended to prevent discharges as described in Sec. 
112.1(b) by ensuring that produced water equipment is well maintained.
    The requirement for periodic inspection of produced water equipment
on a regular schedule is intended to increase the likelihood that a
discharge as described in Sec.  112.1(b) will be prevented or detected
promptly. The inspection requirements for produced water equipment
would be consistent with the inspection requirements for oil containers
at oil production tank batteries under Sec.  112.9(c)(3). The
requirement for periodic skimming of the container should reduce the
impact of a spill by limiting the amount of oil held in a produced
water storage container.
    The Agency seeks comments on this approach, including comment on
the proper methodology, procedures, industry standards/practices,
equipment and frequency for an oil ``skimming program.'' Any
suggestions on alternative approaches or language must include an
appropriate rationale in order for the Agency to be able to consider it
for final action.
c. Exemption for Produced Water Treatment
    Due to several factors including the growing interest in produced
water for beneficial uses, and the understanding that the increased use
of produced water for beneficial uses will reduce the potential for oil
spills, DOE also requested that EPA consider alternatives to current
SPCC requirements for produced water at oil and natural gas operations.
In the July 2002 (67 FR 47139; July 17, 2002) amendments to the SPCC
rule under Sec.  112.1(d)(6), EPA exempted wastewater treatment
facilities or parts thereof from the SPCC rule. In the amended
regulation, EPA defined wastewater treatment as not including oil
production, recovery, or recycling of oil, and clarified that treatment
of produced water was not considered wastewater treatment.
    Since the 2002 amendments were issued, industry, states, and DOE
have commented on the low incremental environmental benefit of
regulating produced water under the SPCC regulation. Concern has also
been expressed by the regulated community regarding the perceived
inequity of the SPCC regulation relative to oil production wastewater
treatment, because the wastewater treatment facilities of publicly
owned treatment works and other industries were exempted from the SPCC
rule in 2002. Therefore, DOE has requested that EPA request comment on
an exemption from the SPCC rule for produced water altogether, similar
to that previously provided to wastewater treatment systems.
    Produced water treatment facilities or parts thereof may be subject
to the National Pollutant Discharge Elimination System (NPDES), Safe
Drinking Water Act (SDWA), Underground Injection Control (UIC), or
State permitting requirements that limit the level of pollutants in
produced water that could be introduced into the environment. For
example, under 40 CFR 122.41(e), NPDES permits require permittees to
properly operate and maintain all facilities and systems of treatment
or control. 40 CFR 122.41(d) requires the NPDES permit holder to take
all reasonable steps to minimize or prevent any discharge in violation
of a permit that has a reasonable likelihood of adversely affecting
health or the environment. Underground sources of drinking water are
protected under 40 CFR 144.12, whereby any underground injection,
except into wells authorized by rule or authorized by permit issued
under the UIC program, is prohibited. These measures are intended to
address the discharge of known pollutants contained in water that is to
be introduced to water bodies (in the case of NPDES) or to groundwater
(in the case of UIC). In contrast to these measures, SPCC is designed
to prevent the non-routine accidental discharge of oil that might be
held in an oil container at a facility.
    Produced water treatment facilities or parts thereof are often
regulated under state laws and regulations applicable to oil and
natural gas production which address operations and pollution
prevention. Oil and natural gas operations, including produced water
treatment facilities on Federal lands managed by the Department of the
Interior Bureau of Land Management are subject to environmental review,
lease stipulations, and operational guidelines that include best
management practices for reducing environmental impacts.\15\
---------------------------------------------------------------------------

    \15\ For example, see Argonne National Laboratory, 2007, ``Produced 
Water Management Information System'' at http://web.evs.anl.gov/pwmis/
and U.S. Department of the Interior, 2007,
Bureau of Land Management Best Management Practices for Fluid
Minerals Web site at 
http://www.blm.gov/wo/st/en/prog/energy/oil_and_gas/
best_management_practices.html.

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

    The characteristics of produced water in the United States vary
widely, ranging from produced water that is potable to produced water
that can be discharged, injected underground or used as a beneficial
water resource following varying levels of treatment to remove oil,
salt, or other chemical constituents. Similarly, factors such as high
energy prices, advances in water treatment technology, and changing
perspectives on the value of produced water for beneficial uses
including agriculture irrigation, livestock watering, recreation,
aquifer recharge, and enhanced oil recovery are factors that may
encourage the industry to separate oil and natural gas fluids from
produced water and to manage the produced water in a manner that will
reduce oil spills. The docket of this proposed rule contains several
documents relating to produced water provided to EPA by DOE.\16\
---------------------------------------------------------------------------

    \16\ Relevant documents include:
    Interstate Oil and Gas Compact Commission and ALL Consulting,
2006, ``A Guide to Practical Management of Produced Water from
Onshore Oil and Gas Operations in the United States.'' Available at
http://www.iogcc.state.ok.us. 
    Veil, J.A., M.G. Puder, D. Elcock, and R.J. Redweik, Jr., 2004,
``A White Paper Describing Produced Water from Production of Crude
Oil, Natural Gas, and Coal Bed Methane,'' prepared by Argonne
National Laboratory for the U.S. Department of Energy, National
Energy Technology Laboratory, January. Available at: 
http://www.ead.anl.gov/pub/dsp_detail.cfm?PubID=1715.

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

    Therefore, as requested by DOE, EPA seeks comment on an exemption
for produced water treatment facilities or parts thereof from the SPCC
regulation. At oil or natural gas drilling, production, recovery, or
recycling facilities, produced water treatment facilities or parts
thereof that would be exempted from SPCC regulation include the
storage, treatment, or beneficial use of produced water in containers,
pits, ponds, piping, flowlines, and injection or discharge systems
including pumps and other appurtenances necessary for the operation of
these systems. Specifically, this approach would amend Sec. 
112.1(d)(iii)(6) pertaining to the general applicability of the SPCC
rule, to read, ``Any facility or part thereof used exclusively for
waste water treatment and not used to satisfy any requirement of this
part. This would include produced water treatment in oil or natural gas
production, recovery, or recycling.''
    Produced water managed prior to the initial separation of co-
mingled oil or natural gas fluids that are produced

[[Page 58418]]

from the wellhead would not be exempted from the SPCC regulation.
    Whether a produced water treatment facility or part thereof is used
exclusively for wastewater treatment (i.e., not storage or other use of
oil) or used to satisfy a requirement of part 112 will often be a
facility-specific determination based on the activity associated with
the facility or part thereof. Only the portion of the facility
(including produced water treatment associated with production,
recovery, or recycling of oil or natural gas) used exclusively for
produced water treatment and not used to meet any part 112 requirement
would be exempt from part 112 under this approach. Examples of produced
water treatment facilities or parts thereof used to meet a part 112
requirement which would not be part of this exemption include an oil/
water separator.
    It should also be noted that under this approach, a discharge of
produced water containing oil to navigable waters or adjoining
shorelines in a ``harmful quantity'' (40 CFR part 110) is still
prohibited. Thus, to avoid such discharges, EPA would expect owners or
operators to comply with the applicable permitting requirements under
Federal or State statutes, including best management practices and
operations and maintenance provisions contained therein. EPA would
require that if a facility experiences a discharge reportable to EPA
under Sec.  112.4, then the facility would no longer be exempt and
sized and general secondary containment would be required for all
produced water containers at the facility within six months from the
discovery of the spill(s).
    The Agency seeks comments on whether exempting produced water
treatment facilities from the SPCC regulation is appropriate. In
particular, EPA requests comment on the rationale for this approach,
i.e., the assumption that the oil content of equipment handling
produced water (e.g., tanks, piping, and related appurtenances) after
initial separation is low. Any suggestions on alternative approaches or
language must include an appropriate rationale in order for the Agency
to be able to consider it for final action.
7. Clarification of the Definition of Permanently Closed Containers
    The SPCC rule exempts from applicability and from capacity
threshold determinations any oil storage container that is permanently
closed. EPA seeks to clarify concerns expressed by the regulated
community over the requirements for permanently closing a container, as
described in the definition of ``permanently closed'' at Sec.  112.2.
According to the definition, for a container to be permanently closed,
all liquid and sludge must be removed from the container and connecting
lines, all connecting lines and piping must be disconnected from the
container and blanked off, all valves (except ventilation valves) must
be closed and locked, and conspicuous signs must be posted on each
container stating that it is a permanently closed container and noting
the date of closure. Once permanently closed, a container is no longer
required to be counted toward the total facility storage capacity, nor
is it subject to the other requirements under the SPCC rule.
    Variable economic conditions and production rates at an oil
production facility may cause certain containers to be unused for long
periods of time. Regulated community members have indicated that
permanent closure of such containers is undesirable because the
requirements for closing a container makes it costly and difficult to
return a container to use if production rates surge or if economic
conditions become more favorable.
    Members of the regulated community have suggested that EPA provide
an option to ``temporarily'' close a container, to exempt it from SPCC
applicability, but allow it to be returned to service if needed.
Specifically, ``temporary closure'' would have less stringent
requirements than permanent closure, and would be intended for
situations where containers would only be closed for short periods of
time. The significant difference in closure requirements between EPA's
current ``permanent'' requirements and the suggested ``temporary''
requirements appears to be the removal of liquid and sludge from the
container and connecting lines. EPA believes that allowing liquid and
sludge to remain in the container, without the benefit of the SPCC rule
protections, such as containment and inspection, creates the potential
for a discharge. Therefore, EPA does not believe that it is appropriate
to exempt containers without requiring that all liquid and sludge be
removed.
    EPA reiterates the statement that the Agency made in the preamble
to the July 2002 amendment to the SPCC rule: ``If a tank is not
permanently closed, it is still available for storage and the
possibility of a discharge as described in Sec.  112.1(b), remains. Nor
does a short time period of storage eliminate the possibility of such a
discharge. Therefore, a prevention plan is necessary. A tank closed for
a temporary period of time may contain oil mixed with sludge or
residues of product, which could be discharged. Discharges from these
facilities could cause severe environmental damage during such
temporary storage and are therefore subject to the rule.'' (67 FR 47059)
    EPA notes, however, that the definition of permanently closed does
not require a container to be removed from a facility; permanently
closed containers may be brought back into use as needed for variations
in production rates and economic conditions. (A facility owner or
operator should review state and local requirements, which may require
removal of a container when it is taken out service.)
    Furthermore, EPA wants to clarify that permanent closure
requirements under the SPCC rule are separate and distinct from the
closure requirements in regulations promulgated under Subtitle C of the
Resource Conservation and Recovery Act (RCRA), i.e., the Standards For
Owners and Operators of Hazardous Waste Treatment, Storage, And
Disposal Facilities at 40 CFR part 264 and Interim Status Standards for
Owners and Operators of Hazardous Waste Treatment, Storage, and
Disposal Facilities at 40 CFR part 265. These regulations describe the
requirements for operators of facilities that use tank systems for
storing or treating hazardous waste, as well as requirements for tank
closure and post-closure care (Sec. Sec.  264.197 and 265.197).
However, these requirements generally do not apply to an oil production
facility. According to the applicability provision in Sec.  264.1(b),
``the standards in this part apply to owners and operators of all
facilities which treat, store, or dispose of hazardous waste, except as
specifically provided otherwise in this part or part 261 of this
chapter'' (emphasis added). Part 261 states that ``Drilling fluids,
produced waters, and other wastes associated with the exploration,
development, or production of crude oil, natural gas or geothermal
energy'' are not hazardous waste (Sec.  261.4(b)(5)). Therefore, an oil
production facility does not have to undergo the expense of permanent
closure under part 264 or part 265 of RCRA, because these wastes--that
is, drilling fluids, produced waters, and other wastes associated with
the exploration, development, or production of crude oil are not
subject to these regulations. In addition, the owner or operator of the
oil production facility could transport such wastes to a non-hazardous
waste disposal or treatment facility, as opposed to a permitted
Subtitle C hazardous waste facility. (The reasons why regulation under
Subtitle C of RCRA for wastes associated with oil

[[Page 58419]]

production was determined to be unwarranted are described in the
Federal Register notice ``Regulatory Determination for Oil and Gas and
Geothermal Exploration, Development, and Production Wastes'' (July 6,
1988; 53 FR 25446).)
    Given the clarifications provided here, EPA does not believe that
further regulatory action is needed to address this issue.
Nevertheless, EPA welcomes comments on whether further clarification
regarding the definition of permanently closed is necessary. Any
suggestions for alternative approaches must include an appropriate
rationale and supporting data in order for the Agency to be able to
consider it for final action.
8. Oil and Natural Gas Pipeline Facilities
    In developing this proposed rulemaking, questions have been raised
concerning the jurisdictional lines between EPA and the Department of
Transportation (DOT) in relation to oil and gas pipeline systems and
associated equipment. Our objective, in keeping with the Executive
Order 12777 and earlier executive orders, as well as the 1971 DOT and
EPA Memorandum of Understanding (MOU), is to differentiate between
``transportation'' and ``non-transportation'' facilities in a manner
that provides clear and definitive standards, while eliminating
regulatory gaps, and overlapping regulation and oversight. To these
ends, EPA and DOT have committed to revise or augment their 1971 MOU to
more clearly define the jurisdictional scope over oil and gas-related
infrastructure by delineating the specific equipment and appurtenances
that are part of the pipeline system subject to DOT jurisdiction. In
the case of a natural gas pipeline, EPA and DOT will evaluate the
appropriate jurisdictional divide for equipment such as compressor
stations, lubricating systems and tanks. EPA and DOT have committed to
diligently pursue resolution of this issue and, early next year, to
make available for public comment the document memorializing the
culmination of this effort. EPA, intends to give notice of completion
of this process in connection with publication of the final version of
this rule by incorporating by reference or otherwise a provision
outlining the agencies' relative jurisdiction in this area.

M. Man-Made Structures

    The SPCC rule is applicable to a facility that, due to its
location, could reasonably be expected to have a discharge of oil as
described in Sec.  112.1(b). As described in a 1976 amendment to the
rule (41 FR 34164, December 11, 1976), this determination must be based
solely upon consideration of the geographical aspects of the facility,
and excludes consideration of manmade features such as dikes,
equipment, or other structures that may serve to restrain, hinder,
contain, or otherwise prevent a discharge as described in Sec. 
112.1(b). As EPA noted in the 1976 rule preamble, ``manmade features,
such as drainage control structures and dikes, are not to be used in
concluding there is no reasonable expectation that a discharge will
reach navigable waters. If there is a reasonable expectation that a
discharge from the facility would reach navigable waters but for or in
the absence of such containment or other structures, the facility is
subject to the requirements of this part.'' (41 FR 34164, December 11,
1976). This policy has been an important foundation for the
applicability of the SPCC rule for over 30 years.
    Although the issue was addressed in 1976, members of the regulated
community continue to raise questions regarding the use of man-made
structures. In the preamble to the 2002 SPCC rule revisions, EPA
responded to comments by explaining that, ``To allow consideration of
manmade structures (such as dikes, equipment, or other structures) to
relieve a facility from being subject to the rule would defeat its
preventive purpose. Because manmade structures may fail, thus putting
the environment at risk in the event of a discharge, there is an
unacceptable risk in using such structures to justify relieving a
facility from the burden of preparing a prevention plan.'' (67 FR
47062, July 17, 2002). However, members of the regulated community
continue to suggest that man-made features, such as basements or
containment structures, should be taken into consideration when
determining whether the SPCC requirements apply.
    EPA continues to uphold this applicability criterion, but seeks to
clarify that certain man-made features, such as building walls,
basement structures, and drainage systems may be taken into
consideration in determining how to comply with the SPCC requirements.
1. Secondary Containment
    If an oil storage container at a regulated facility is located
inside a building, the PE or facility owner/operator certifying the
SPCC Plan may take into consideration the ability of the building walls
and/or drainage systems to serve as secondary containment for the
container. The SPCC regulation is performance-based and provides
flexibility to the facility owner or operator in terms of the design
and implementation of the secondary containment system that will
provide adequate protection. Secondary containment may be achieved by
use of dikes, berms, or other barriers, engineered drainage structures,
or other active or passive containment methods. The regulation provides
general design criteria for secondary containment of bulk storage
containers by requiring simply that the containment be of a size
sufficient to contain the capacity of the largest container, with
freeboard for precipitation, as appropriate. EPA does not require the
use of specific sizing criteria to account for precipitation (e.g., 110
percent of capacity); instead it allows the facility owner or operator,
or the PE certifying the Plan, to consider location specific
conditions, including the possibility that a bulk storage container is
located indoors where precipitation does not occur. The SPCC rule also
requires that the containment structure provided around bulk storage
containers be sufficiently impervious to oil. Therefore, the
containment structure must not be equipped with open floor drains
unless the drainage system has been purposefully equipped to treat any
discharge, for example by use of an adequately sized oil-water
separator (any indoor drainage system that leads directly to a sewer
authority, Publicly Owned Treatment Works (POTW), or a waterbody may
serve as a conduit for a discharge to navigable waters). Additionally,
any doorways, windows, or other openings thatwould permit a discharge
to flow out of the building must also be taken into consideration. To
the extent that an existing building structure meets the SPCC
performance criteria for secondary containment, the owner/operator can
consider such a building as an appropriate containment structure. In
cases where the building walls may be used for secondary containment,
it should be noted, that the calculation of the capacity of the
secondary containment structure would need to consider the displacement
by other containers, equipment, and items sharing the containment
structure.
    Where applicable, containers may be subject to the National Fire
Protection's Flammable and Combustible Liquids Code (NFPA 30) in
addition to the SPCC requirements. In these situations, the building
may serve as both general and sized secondary containment. For
containers located in buildings, NFPA 30 prescribes specific
requirements to control fire hazards involving

[[Page 58420]]

flammable or combustible liquids, particularly in the areas of design,
construction, ventilation, and ultimately facility drainage. More
specifically, NFPA 30 requires curbs, scuppers, drains or similar
features to prevent the flow of liquids in emergencies to adjacent
buildings, including provisions to handle water from fire protection
systems. In the area of facility drainage, NFPA 30 requires that a
facility be designed and operated to prevent the discharge of liquids
to public waterways, public sewers, or adjoining property. Thus, if a
facility is designed, constructed and maintained to applicable fire
codes, such as NFPA 30, the building may serve as secondary containment
under the SPCC rule.
    Given the clarifications provided here, EPA does not believe that
further regulatory action is needed to address this issue. EPA welcomes
comments on whether further clarification regarding the use of building
structures to meet the SPCC secondary containment requirements is
necessary.
2. Integrity Testing
    The SPCC rule requires that bulk storage containers be made of
compatible materials and are appropriate for the conditions of storage,
such as pressure and temperature (Sec. Sec.  112.8(c)(1) and
112.12(c)(1)), and are tested for integrity on a regular schedule
(Sec. Sec.  112.8(c)(6), and 112.12(c)(6)). If, at a regulated
facility, indoor conditions are such that they reduce external
corrosion and potential for discharges, these operating conditions may
be considered in the development of a site-specific inspection program.
Tank inspection standards, such as the American Petroleum Institute's
(API) Standard 653 and the Steel Tank Institute's (STI) SP001, detail
the appropriate inspection scope and frequency depending on container
type and configuration. However, in developing a regulated facility's
inspection program, it should be recognized that although indoor oil
storage containers are generally shielded from precipitation,
precipitation is only one of the many factors that promote corrosion.
Even indoors, high humidity acidic dust settling on the container
surface or some other factor may promote external corrosion.
Furthermore, indoor containers may be comparatively more susceptible to
accidental impacts from mobile equipment (e.g., forklifts) given the
more restricted space. Indoor containers also remain subject to
internal corrosion that can lead to pitting and leaking.
    The SBA requested that EPA consider whether there should be
differentiated integrity testing requirements for containers located
indoors. With respect to integrity testing of aboveground storage tanks
located indoors, applicable industry inspection standards, such as API
653 and STI SP001 do not specifically differentiate inspection
requirements for indoor versus outdoor containers. However, SP001, for
example, does differentiate based on container size and configuration,
and, for tanks with storage capacities up to 5,000 gallons provided
with sized secondary containment and a release prevention barrier (such
as a liner, concrete pad, or an elevated tank in secondary
containment), the standard requires visual inspection and recordkeeping
by the owner/operator per the SP001 schedule. For tanks greater than
5,000 gallons in the same configuration, SP001 requires visual
inspection by the owner/operator coupled with a formal external
inspection by a certified inspector on a 20-year cycle versus a more
stringent inspection scope and schedule for tanks located outdoors in
earthen secondary containment. Therefore, the Agency believes that the
industry standards already provide flexibility to the owner/operator of
the facility based on tank size and configuration. Additionally, the
owner/operator in conjunction with the certifying PE has the
flexibility under the SPCC regulation to develop an alternate container
inspection program.
    Given the clarifications provided here, EPA does not believe that
further regulatory action is needed to address this issue.
Nevertheless, EPA welcomes comments on whether further clarification
regarding requirements for integrity testing of containers located
indoors, or a regulatory amendment is necessary.

N. Underground Emergency Diesel Generator Tanks at Nuclear Power Stations

    Under the U.S. Nuclear Regulatory Commission (NRC) regulations, a
nuclear power generation facility must meet certain design criteria to
ensure that the plant will be operated in a manner protective of the
public's health and safety (10 CFR part 50, Appendix A). The NRC design
criteria cover the design, fabrication, installation, testing and
operation of structures, systems, and components important to safety.
Nuclear power stations are required to provide redundant on-site
electric power system and an off-site power system to allow functioning
of structures, systems, and components important to safety. These on-
site power systems typically consist of diesel-powered emergency or
standby generators, which may include day fuel tanks, either integral
to the generator or immediately adjacent to the unit. Additional
reserve capacity may also be provided by aboveground and/or underground
storage tanks (USTs) to meet the NRC requirement to provide a seven-day
supply of fuel oil on-site. Each utility develops its particular
systems and procedures for ensuring their operability and integrity;
these elements become part of the safety program that is reviewed and
approved by NRC in granting an operating license for the utility.
    EPA currently exempts from the SPCC requirements any completely
buried storage tank that is subject to all of the technical
requirements for USTs under 40 CFR part 280 or a state program approved
under part 281. However, as discussed in the preamble to the final rule
for parts 280 and 281 (53 FR 37082, September 23, 1988), the Agency
chose to defer the requirements of Subparts B, C, D, E, and G for these
tanks pending completion of a review of the NRC regulations (10 CFR
part 50, Appendix A) governing these tanks to determine whether further
regulation under the UST regulations is necessary to protect human
health and the environment or whether such regulation would be
inconsistent with the NRC regulations. Thus, UST tanks that are part of
an emergency generator system at a nuclear power generation facility
regulated by the NRC are still subject to some of the UST regulations.
For example, deferred tanks must still comply with the release response
and corrective action requirements under Subpart F (Sec. Sec.  280.60
through 280.67). Consequently, because these tanks are not subject to
all of the UST requirements, they are currently subject to the SPCC
requirements.
    Nuclear power plant stakeholders have provided comments to the
Agency questioning whether dual regulation of these USTs under relevant
NRC requirements and SPCC requirements is appropriate or necessary. The
industry has also indicated that to comply with SPCC requirements, the
unit would need to be shut down to properly address secondary
containment and integrity testing and inspection requirements; to do so
otherwise would violate stringent NRC operating safety requirements. A
shutdown to address SPCC requirements is costly and jeopardizes public
power supply needs. To further analyze the potential overlap and
concerns relative to the SPCC requirements in light of NRC
requirements, EPA conducted a site visit to a nearby nuclear power
station and consulted NRC.

[[Page 58421]]

    EPA compared the NRC regulations and guidelines with the relevant
SPCC requirements. Under 10 CFR Part 50, Appendices A and B, nuclear
power generation facility operators must identify the relevant codes
and standards, develop and implement a quality assurance program, and
maintain appropriate records of the design, fabrication, erection, and
testing throughout the life of the nuclear unit. The quality assurance
program required per Appendix B must be documented by written policies,
procedures or instructions and implemented as documented. To assist
nuclear power unit licensees in complying with the license
requirements, the NRC has developed a number of guidance documents,
including documents pertaining to the operation of standby diesel
generators. Specifically, NRC Regulatory Guide 1.137, ``Fuel-Oil
Systems for Standby Diesel Generators'' details the requirements for
inspection and testing of fuel oil systems, corrosion protection, and
the periodic cleaning of fuel supply tanks. These measures are similar
to the measures required under the SPCC regulation for completely
buried tanks, which include corrosion protection of buried tanks (Sec. 
112.8(c)(4)) and of buried piping (Sec.  112.8(d)(1)), and inspection
and testing of buried piping (Sec.  112.8(d)(4)). According to NRC,
this guideline represents one acceptable method to meet the NRC
requirements for these standby systems. If a licensee chooses an
alternative approach then equivalency must be demonstrated through an
engineering review by the NRC as part of the licensing process.
    In conducting the site visit to a nearby nuclear power station, EPA
observed that the standby generators had both aboveground and
underground storage tanks on-site to meet the requisite fuel demands.
The USTs were installed in 1973 and consist of single-walled steel
tanks equipped with automatic tank gauging and are subjected to
nondestructive evaluation (ultrasonic thickness testing) every 10
years. Associated piping is tested every 10 years. EPA then reviewed
the relevant SPCC requirements associated with USTs that meet the
definition of completely buried tanks in Sec.  112.2 of the SPCC rule
and conducted a comparative analysis as detailed below.
     All containers: Sec.  112.8(c)(2): Sized secondary
containment requirements.
     Buried Tanks: Sec.  112.8(c)(4): Protection and leak
testing of buried metallic tanks.
     All Containers: Sec.  112.8(c)(8): Engineering of each
container to prevent overfills.
     Buried Piping: Sec.  112.8(d): Protection and leak testing
of buried piping.
    Since the USTs are single-walled steel tanks, the tanks may not
meet the secondary containment requirements at Sec.  112.8(c)(2);
however, an argument could be made that secondary containment is
impracticable under Sec.  112.7(d). Since these USTs remain subject to
Subpart F of Part 280 (Release Response and Corrective Action for UST
Systems Containing Petroleum or Hazardous Substances), the requirements
of Sec.  112.7(d)(1) and 112.7(d)(2) may be met. Additionally, since
the tanks were installed prior to January 10, 1974, the completely
buried tanks are not subject to the cathodic protection requirements at
Sec.  112.8(c)(4). However, since the tanks are subjected to a non-
destructive evaluation on a 10-year cycle, the leak testing requirement
under Sec.  112.8(c)(4) would be met. Completely buried tanks are also
subject to the engineering requirement at Sec.  112.8(c)(8) to prevent
overfills. The observed tanks were equipped with automatic tank
gauging. Buried piping associated with the completely buried tanks is
subjected to pressure testing on a 10-year cycle; however, since the
piping was installed prior to 2002, the buried piping is not subject to
the coating, wrapping and cathodic protection requirements at Sec. 
112.8(d)(1).
    The case summarized above illustrates the similarities between UST
safety measures implemented under the NRC regulations and SPCC
requirements applicable to completely buried tanks. EPA believes that
nuclear power plants have unique characteristics that differentiate
them from other types of regulated facilities. Thus, EPA understands
that certain actions necessary to comply with the SPCC rule could be
impracticable at NRC facilities because they may compromise the
availability of the emergency diesel generation tank and consequently
affect the reliability of the nuclear power supply and result in the
shut down of a nuclear power plant. EPA believes that the NRC operating
safety requirements best address the specific and unique operational
challenges represented by completely buried tanks at nuclear power
plants. EPA is, therefore, proposing to exempt completely buried oil
storage tanks at NRC-regulated facilities that are subject to the
safety requirements under the NRC regulations. The exemptions would
apply only to completely buried tanks as defined in Sec.  112.2 of the
SPCC regulation. Similar to completely buried tanks subject to all the
technical requirements of 40 CFR part 280 or a State program approved
under 40 CFR part 281, completely buried tanks at NRC-regulated
facilities would not be counted as part of the aggregate aboveground
storage capacity of the facility, but the tanks would need to be marked
on the facility diagram as provided in Sec.  112.7(a)(3) if the
facility is otherwise subject to the SPCC rule.
    EPA seeks comments on the proposed exemption of completely buried
oil storage tanks at NRC facilities. Any alternative approach presented
must include an appropriate rationale and supporting data in order for
the Agency to be able to consider it for final action.

O. Wind Turbines

    The Agency was requested to address the applicability of the rule
to wind turbines used to produce electricity. In consultation with DOE,
EPA's research shows that the larger 1.5-mega watt (MW) turbines have
gearbox capacities typically ranging between 55 and 65 gallons.
Additionally, other wind turbine components, such as the gear reducers
within the turbine for yaw and pitch control may contain up to 10
gallons of lubricating oil. Based on these capacities, wind turbine
farms at locations where there is a reasonable expectation of a
discharge to navigable waters or adjoining shorelines could meet the
1,320-gallon aggregate aboveground oil storage capacity applicability
threshold for the SPCC rule and would be required to prepare a Plan.
The Agency believes that these wind turbines meet the definition of
oil-filled operational equipment promulgated in the December 2006 SPCC
rule amendments (71 FR 77266, December 26, 2006) and thus can take
advantage of the alternative compliance option provided for this type
of equipment.
    The amendments to the SPCC rule promulgated in December 2006 allow
owners and operators of facilities with eligible oil-filled operational
equipment the option to prepare an oil spill contingency plan and a
written commitment of manpower, equipment, and materials to
expeditiously control and remove any oil discharged that may be harmful
without having to make an individual impracticability determination as
required in Sec.  112.7(d). If an owner or operator takes this option,
he or she is also required to establish and document an inspection or
monitoring program for this qualified oil-filled operational equipment
to detect equipment failure and/or a discharge in lieu of providing
secondary containment.
    The Agency defined ``oil-filled operational equipment'' as ``equipment

[[Page 58422]]

that includes an oil storage container (or multiple containers) in
which the oil is present solely to support the function of the
apparatus or the device. Oil-filled operational equipment is not
considered a bulk storage container, and does not include oil-filled
manufacturing equipment (flow-through process). Examples of oil-filled
operational equipment include, but are not limited to, hydraulic
systems, lubricating systems (e.g., those for pumps, compressors and
other rotating equipment, including pumpjack lubrication systems), gear
boxes, machining coolant systems, heat transfer systems, transformers,
circuit breakers, electrical switches, and other systems containing oil
solely to enable the operation of the device.'' (71 FR 77290)
    These examples the Agency included in definition of oil-filled
operational equipment were intended to provide additional clarity and
not to exclude other such equipment. Based on their characteristics,
the Agency considers wind turbines to meet the definition of oil-filled
operational equipment. Wind farm facilities can take advantage of the
oil spill contingency plan compliance option as an alternative to
secondary containment requirements.
    In addition, in examining the design of a wind turbine, a PE (or
owner/operator of a qualified facility) may determine that it
inherently provides sufficient secondary containment for its oil
reservoirs. The nacelle, or structure that contains the key components
of the turbine, including the gearbox and the electrical generator, may
be determined to serve as sufficient secondary containment in the event
of an oil discharge. Thus, the PE or owner/operator of a qualified
facility may certify a wind turbine as being in compliance with the
Sec.  112.7(c) requirements for secondary containment. As such, the
alternative measures described in Sec.  112.7(k) (i.e., an oil spill
contingency plan, the commitment of resources and manpower, and an
inspection or monitoring program) would not be necessary.
    It is important to note that a wind farm that meets the criteria
for qualified facility status has additional compliance alternatives,
and flexibility is available, the most significant being the option for
self-certification of his SPCC Plan. EPA seeks comments on whether this
discussion provides adequate clarity on the applicability of the SPCC
rule to wind turbines, or whether further clarification is needed.

P. Technical Corrections

    EPA proposes a technical correction to the introductory paragraph
of Sec.  112.3, to move the phrase ``in writing'' after ``must
prepare'' and then insert the phrase ``and implement'' after the phrase
``in writing'', in order to provide an explicit requirement for a
facility owner to both prepare and implement an SPCC Plan. This
paragraph describes the requirement for an owner or operator of an
onshore or offshore facility subject to the rule to prepare an SPCC
Plan, in writing, and in accordance with Sec.  112.7 and any other
applicable section of the rule. Adding the term ``and implement'' to
this paragraph would be consistent with the subsequent subsections,
which provide compliance dates to both prepare or amend, and implement,
an SPCC Plan for various categories of facility owners and operators.
In describing the requirement to prepare a Plan in the introductory
paragraph of Sec.  112.3, the Agency inadvertently excluded the
explicit requirement to also implement that Plan. Clearly, a facility
owner or operator must implement his SPCC Plan in order for it to be
effective in preventing discharges of oil to navigable waters and
adjoining shorelines. In order to provide clarity, EPA will explicitly
include the word ``implement'' in Sec.  112.3 as a technical
correction, and seeks comment on this clarification.
    EPA also proposes a technical correction to the introductory
paragraph of Sec.  112.12, to delete the phrase ``(excluding a
production facility.)'' In the December 2006 amendments to the SPCC
rule (71 FR 77266, December 26, 2006), EPA amended Subpart C of part
112 by removing several sections because they were not appropriate for
animal fats and vegetable oils. At that time, as a point of
clarification, EPA also removed the phrase ``for onshore facilities
(excluding production facilities)'' from the title of Sec.  112.12,
because, having removed the inapplicable production facility
requirements from Subpart C, it was no longer necessary to
differentiate onshore oil production facilities from other facilities
in Sec.  112.12. However, EPA inadvertently neglected to remove the
corresponding phrase from the introductory paragraph of the section.
EPA currently seeks to correct this inadvertent omission. EPA seeks
comments on this proposed technical correction.

VII. Statutory and Executive Order Reviews

A. Executive Order 12866--Regulatory Planning and Review
     Under section 3(f)(1) of Executive Order (EO) 12866 
(58 FR 51735,
October 4, 1993), this action is an ``economically significant
regulatory action'' because it is likely to have an annual effect on
the economy of $100 million or more. Accordingly, EPA submitted this
action to the Office of Management and Budget (OMB) for review under EO
12866 and any changes made in response to OMB recommendations have been
documented in the docket for this action. In addition, EPA prepared an
analysis of the potential costs and benefits associated with this
action. This analysis is contained in the regulatory impact analysis
(RIA) entitled, ``Regulatory Impact Analysis for the Proposed
Amendments to the Oil Pollution Prevention Regulations (40 CFR Part
112)'' (September 2007). A copy of the analysis is available in the
docket for this action and the analysis is briefly summarized here. EPA
requests comments from the public on the costs and benefits of any of
the proposed regulatory alternatives and preferred options discussed in
this proposed rulemaking action.
    For the economic impact analysis of these proposed amendments to
the SPCC rule, EPA used the SPCC rule requirements at 40 CFR part 112,
as amended in 2002 (67 FR 47042, July 17, 2002) as the baseline to
estimate the potential cost savings to regulated facilities from these
proposed amendments. The cost savings are not adjusted for the
estimated, potential cost savings for the final 2006 rule amendments
and may overestimate the cost savings for these proposed amendments,
particularly for proposed Tier 1 qualified facilities, proposed
revisions to the integrity testing requirement, and the proposed
amendments to delay SPCC Plan preparation and implementation for oil
production facilities. The regulatory impact analysis developed in
support of this proposal compares the compliance costs for owners and
operators of facilities affected by the proposed amendments to the
costs owners and operators would face under the 2002 SPCC rule
amendments. The proposed regulatory amendments have twelve major
components: (1) Exempt hot-mix asphalt; (2) exempt pesticide
application equipment and related mix containers used at farms; (3)
exempt heating oil containers at single-family residences; (4) amend
the definition of ``facility'' to clarify the flexibility

[[Page 58423]]

associated with defining a facility's boundaries; (5) amend the
facility diagram requirement to provide additional flexibility for all
facilities; (6) define ``loading/unloading rack'' to clarify the
equipment subject to the provisions for facility tank car and tank
truck loading/unloading racks; (7) provide streamlined requirements for
a subset of qualified facilities; (8) amend the general secondary
containment provision to provide more clarity; (9) amend the security
requirements for all facilities; (10) amend the integrity testing
requirements to allow a greater amount of flexibility in the use of
industry standards at all facilities; (11) amend the integrity testing
requirements for containers that store animal fats or vegetable oils
and meet certain criteria; (12) streamline a number of requirements at
oil production facilities; and (13) exempt completely buried oil
storage tanks at nuclear power generation facilities. EPA is also
providing clarification in the preamble to this proposed rule on three
additional issues identified by the regulated community: (1) the
consideration of man-made structures in determining how to comply with
the SPCC rule requirements; (2) the applicability of the rule to
underground emergency diesel generator tanks at nuclear power stations,
and (3) the applicability of the rule to wind turbines for electricity
generation.
    For each of these components, EPA estimated potential cost savings
to regulated facilities that may result from reductions in compliance
costs. The main steps used to estimate the compliance cost impacts of
the SPCC proposed rule are as follows:
     Develop the baseline universe of SPCC-regulated facilities;
     Estimate the number of facilities affected by the proposed
rule amendments;
     Estimate changes in unit compliance cost for each
regulated facility affected by the proposed rule;
     Estimate total compliance cost savings to owners and
operators of potentially affected facilities; and
     Annualize compliance cost savings over a ten-year period,
2008 through 2017, and discount the estimates using 3 and 7 percent
discount rates.
    Based on these steps, EPA estimated the annualized compliance cost
savings to potentially affected facilities associated with each of the
major components of the proposed rule, and presents the results of the
economic analysis in Exhibit 1. EPA uses four key assumptions in its
regulatory impact analysis. First, the Agency assumes that cost
minimization behavior applies to all owners and operators of facilities
that qualify for reduced regulatory requirements, whereby all those
affected would seek burden relief. Second, EPA assumed, consistent with
EPA's guidelines for conducting economic analyses, that all existing
owners and operators of facilities are in full compliance with the July
2002 amendments to the SPCC rule (67 FR 47042). Third, EPA assumes that
owners and operators of existing SPCC-regulated facilities would forgo
compliance activities offered as alternatives to activities that
required one-time initial investments because they would have already
incurred a one-time cost. For example, EPA assumes that an owner or
operator of an existing facility who would qualify for reduced security
requirements under the proposed rule that allows facility owners/
operators to tailor their security measures to the facility's specific
characteristics and location, would have already provided the security
measures as per the 2002 rule amendments or demonstrated environmental
equivalence for tailored security measures. Thus, owners and operators
of existing facilities would not take advantage of the provided
alternative. Fourth, EPA assumes that compliance is nationally
consistent although variability in state regulations and the
distribution of affected facilities is recognized.
    Exhibit 1 presents the estimated cost savings for each rule
component and for the proposed rule amendments in total. For several
proposed rule amendments, such as the security requirements and
facilities handling AFVO, EPA did not have numeric data on the number
of affected facilities within a general industry sector; thus, it
developed three scenarios to evaluate a range of cost savings.\17\ The
exhibit below presents the estimated cost savings for the proposed
options for this proposed rule. The total potential cost savings are
calculated taking into account the mid-point values of the estimated
ranges of statistical distributions for unit costs. These estimates are
not necessarily additive, given that they do not account for
interactions among the various components of the proposed rule.\18\
---------------------------------------------------------------------------

    \17\ For example, to develop a range for the number of affected
AFVO facilities, EPA contacted industry experts who determined that
40 percent to 90 percent of containers at AFVO facilities are made
of stainless steel and almost all containers have bottom drainage.
Therefore, based on professional judgment, the Agency considered
three scenarios: 40% (low), 65% (medium) and 90% (high) of all AFVO
facilities would have food oil tanks that are eligible.
    \18\ Certain industry sectors are affected by multiple rule
components. For example, farms would benefit from the new
requirements for Tier I qualified facilities, amendments to the
definition of ``facility'', amendments to the security, integrity
testing, facility diagram requirements, amendments to the definition
of ``loading/unloading rack'', and the exemption for single-family
residential heating oil containers, in addition to the exemption of
pesticide application equipment. As a result, taking advantage of
one new requirement might preclude a facility from benefiting from
other proposed requirements.
---------------------------------------------------------------------------

    The oil production sector and farms would benefit from multiple
components of the proposed rule. Farms would benefit from the proposed
requirements for Tier I qualified facilities, amendments to the
definition of ``facility'', amendments to the security, integrity
testing, facility diagram requirements, amendments to the definition of
``loading/unloading rack'', and the exemption for single-family
residential heating oil containers, in addition to the exemption of
pesticide application equipment. The total cost savings to farm owners
and operators from these amendments are estimated at $263 million on an
annualized basis.
    The oil production sector would benefit from proposed revisions to
the facility diagram requirements, and amendments to the definition of
``loading/unloading rack'', and some would benefit from the new
requirements for Tier I qualified facilities, in addition to amendments
specific to the oil production sector such as the six-month delay in
preparation and implementation of SPCC Plans and the exemption of flow-
through separation and treating equipment from sized secondary
containment requirements. The total savings to owners and operators of
oil production facilities from all of the proposed amendments that
affect this sector are estimated at $83 million on an annualized basis.

[[Page 58424]]

     Exhibit 1.--Estimated Compliance Cost Savings for the Proposed
                          Regulatory Amendments
------------------------------------------------------------------------
                                              Annualized cost  savings
          Rule component/scenario             ($2006,  in millions,  7%
                                                   discount rate)
------------------------------------------------------------------------
Hot-Mix Asphalt:
    Exempt HMA containers.................  $7
Farms:
    Exempt pesticide application            $4
     equipment; clarification on nurse
     tanks being mobile refuelers.
Residential Heating Oil Containers:
    Exempt single-family residential        $2
     heating oil containers.
Definition of Facility:
    Revise the definition of ``facility''.  $251
Facility Diagram:
    Revise facility diagram requirement...  $1
Loading/Unloading Racks:
    Define ``loading/unloading rack''.....  $48
Tier I Qualified Facilities:
    Provide streamlined requirements for    $24
     Tier I qualified facilities.
General Secondary Containment:
    Amend the general secondary             No cost impact.
     containment provision to provide more
     clarity.
Security Requirements:
    Revise security requirements \1\......  $7
Integrity Testing:
    Amend the integrity testing             $9
     requirements to allow a greater
     amount of flexibility in the use of
     industry standards at all facilities.
Animal Fats and Vegetable Oil:
    Amend integrity testing requirements    $2
     for containers that store animal fats
     or vegetable oil and that meet
     certain criteria \2\.
Oil Production Facilities:
    Six month delay for Plan preparation    $25
     and implementation.
    Exempt flowlines and gathering lines    No net cost impact.
     from secondary containment.
    Flow-through separation and treatment   $8
     equipment.
Man-Made Structures:
    Consider manmade structures in          No cost impact.
     determining SPCC rule applicability.
Nuclear Power Stations:
    Exempt completely buried oil storage    Less than $1.
     tanks at nuclear power generation
     facilities..
Wind turbines:
    Clarify applicability of the rule to    No cost impact.
     wind turbines used to produce
     electricity.
                                           -----------------------------
        Total.............................  $387
------------------------------------------------------------------------
\1\ Mid-point estimate (17% of oil production facilities, 50% of AFVO
  facilities, and 8% of farms affected). Cost savings might be higher or
  lower using different assumptions.
\2\ Mid-point estimate (65% of facilities affected). Cost savings might
  be lower using different assumptions.

B. Paperwork Reduction Act

    The information collection requirements for this proposed rule have
been submitted for approval to OMB under the Paperwork Reduction Act,
44 U.S.C. 3501 et seq. The Information Collection Request (ICR)
document prepared by EPA has been assigned EPA ICR number 0328.14.
    EPA does not collect the information required by the SPCC rule on a
routine basis. SPCC Plans ordinarily need not be submitted to EPA, but
must generally be maintained at the facility. Preparation,
implementation, and maintenance of an SPCC Plan by the facility owner
or operator helps prevent oil discharges and mitigate the environmental
damage caused by such discharges. Therefore, the primary user of the
data is the facility personnel. While EPA may, from time to time,
request information under these regulations, such requests are not routine.
    Although facility personnel are the primary data user, EPA also
uses the data in certain situations. EPA reviews SPCC Plans: (1) When
it requests a facility owner or operator to submit required information
in the event of certain discharges of oil or to evaluate an extension
request; and (2) as part of the EPA's inspection program. State and
local governments also use the data, which are not necessarily
available elsewhere and can greatly assist local emergency preparedness
efforts. Preparation of the information for affected facilities is
required under section 311(j)(1) of the Clean Water Act as implemented
by 40 CFR part 112.
    EPA estimates that in the absence of this proposed rulemaking,
approximately 592,000 existing facilities would be subject to the SPCC
rule in 2008 and have SPCC Plans. In addition, EPA estimates that
approximately 18,100 new facilities would become subject to the SPCC
requirements during that year, resulting in a total of about 610,000
regulated facilities in 2008.\19 \
---------------------------------------------------------------------------

    \19\ To estimate the number of SPCC-regulated facilities in
2008, EPA used the estimated number of facilities for 2005 (571,000)
and applied annual, industry-specific growth rates that resulted in
about 610,000 facilities.
---------------------------------------------------------------------------

    Under this proposed action, the storage capacity of containers
solely containing hot-mix asphalt would be exempt from the SPCC rule;
the proposal would also exempt all heating oil containers for single-
family residences; pesticide application equipment and related mix
containers used at farms would no longer be regulated; the definition
of ``facility'' would be amended to clarify that contiguous or non-
contiguous buildings, properties, parcels, leases, structures,
installations, pipes, or pipelines may be considered separate
facilities, and to specify that the ``facility'' definition governs the
applicability of 40 CFR part 112; EPA would amend the facility

[[Page 58425]]

diagram requirement to provide additional flexibility for all
facilities; EPA would provide a definition for the term ``loading/
unloading rack,'' which would determine whether a facility is subject
to the provisions at Sec.  112.7(h), as well as specifically exclude
onshore oil production facilities and farms from the requirements of
Sec.  112.7(h); a subset of qualified facilities (Tier I) would be
allowed to complete and implement an SPCC Plan template (proposed as
Appendix G to 40 CFR part 112) in order to comply with the SPCC rule
requirements; the security requirements at Sec.  112.7(g) would be
modified to allow an owner or operator to tailor his security measures
to the facility's specific characteristics and location; the current
integrity testing requirements at Sec. Sec.  112.8(c)(6) and
112.12(c)(6) would be replaced with the requirements provided for
qualified facilities, as promulgated in December 2006; the PE or an
owner/operator certifying an SPCC Plan would have the flexibility to
determine the scope of integrity testing that is appropriate for
containers that store animal fats or vegetable oil that is intended for
human consumption and that meet other criteria; lastly, this proposed
rulemaking would streamline the requirements for oil production
facilities by modifying the definition of production facility to be
consistent with the proposed amendments to the definition of facility,
extending the timeframe by which a new oil production facility must
prepare and implement an SPCC Plan, exempting flow-through process
vessels at oil production facilities from the sized secondary
containment requirements, while maintaining general secondary
containment requirements and requiring additional oil spill prevention
measures, establishing more specific requirements for contingency
planning and a flowline/intra-facility gathering line maintenance
program, while exempting such flowlines and intra-facility gathering
lines at oil production facilities from the secondary containment
requirements, clarifying the applicability of the SPCC rule to oil
containers at a natural gas facility, clarifying the SPCC provisions to
which a natural gas facility may be subject, and clarifying the
definition of ``permanently closed'' as it applies to an oil production
facility.
    Under this proposed action, an estimated 610,000 regulated
facilities would be subject to the SPCC information collection
requirements of this rule in 2008.\20\ The Agency estimates that as a
result of the proposed amendments to tailor, clarify, and streamline
certain SPCC requirements, the reporting and recordkeeping burden would
decrease by approximately 1.4 million hours. The proposed amendments
would reduce capital and O&amp;M costs by approximately $43 million on an
annualized basis.
---------------------------------------------------------------------------

    \20\ To estimate the number of SPCC-regulated facilities in
2008, EPA used the estimated number of facilities for 2005 (571,000)
and applied annual industry-specific growth rates.
---------------------------------------------------------------------------

    Burden means the total time, effort, or financial resources
expended by persons to generate, maintain, retain, or disclose or
provide information to or for a Federal agency. This includes the time
needed to review instructions; develop, acquire, install, and utilize
technology and systems for the purposes of collecting, validating, and
verifying information, processing and maintaining information, and
disclosing and providing information; adjust the existing ways to
comply with any previously applicable instructions and requirements;
train personnel to be able to respond to a collection of information;
search data sources; complete and review the collection of information;
and transmit or otherwise disclose the information.
    An agency may not conduct or sponsor, and a person is not required
to respond to a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act generally requires an agency to
prepare a regulatory flexibility analysis of any rule subject to notice
and comment rulemaking requirements under the Administrative Procedure
Act or any other statute unless the agency certifies that the rule will
not have a significant economic impact on a substantial number of small
entities. Small entities include small businesses, small organizations,
and small governmental jurisdictions.
    For purposes of assessing the impacts of this proposed rule on
small entities, a small entity is defined as: (1) A small business as
defined in the U.S. Small Business Administration (SBA)'s regulations
at 13 CFR 121.201--the SBA defines small businesses by category of
business using North American Industry Classification System (NAICS)
codes, and in the case of farms and oil production facilities, which
constitute a large percentage of the facilities affected by this
proposed rule, generally defines small businesses as having less than
$0.5 million to $27.5 million per year in sales receipts, depending on
the industry, or 500 or fewer employees, respectively; (2) a small
governmental jurisdiction that is a government of a city, county, town,
school district or special district with a population of less than
50,000; and (3) a small organization that is any not-for-profit
enterprise that is independently owned and operated and is not dominant
in its field.
    After considering the economic impacts of this proposed rule on
small entities, the Agency certifies that this action would not have a
significant economic impact on a substantial number of small entities.
In determining whether a rule has a significant economic impact on a
substantial number of small entities, the impact of concern is any
significant adverse economic impact on small entities, since the
primary purpose of the regulatory flexibility analyses is to identify
and address regulatory alternatives ``which minimize any significant
economic impact of the proposed rule on small entities'' (5 U.S.C. 603
and 604). Thus, an agency may certify that a rule would not have a
significant economic impact on a substantial number of small entities
if the rule relieves regulatory burden, or otherwise has a positive
economic effect on all of the small entities subject to the rule.
    Under this proposal, the following issues will be addressed: exempt
hot-mix asphalt from SPCC requirements; exempt specific oil storage
equipment on farms from the SPCC rule requirements; exempt heating oil
containers at single-family residences; clarify how containers, fixed
and mobile, are identified on the facility diagram; modify the
definition of ``facility'' to clarify that contiguous or non-contiguous
buildings, properties, parcels, leases, structures, installations,
pipes, or pipelines may be considered separate facilities and that the
definition of ``facility'' governs the applicability to the SPCC rule;
define ``loading/unloading rack'' to clarify whether a facility is
subject to the SPCC rule requirements of Sec.  112.7(h); streamline the
requirements for a subset of qualified facilities (Tier I qualified
facilities); amend the facility security requirements at Sec.  112.7(g)
to allow an owner or operator to tailor security measures to his
facility's specific characteristics and location; replace the current
integrity testing requirements at Sec. Sec.  112.8(c)(6) and
112.12(c)(6) with the current regulatory requirement for a qualified
facility; provide the PE or an owner/operator certifying an SPCC Plan
with the flexibility for integrity testing

[[Page 58426]]

for bulk storage containers that store animal fats or vegetable oil and
that meet other criteria; and initiate several amendments to streamline
the requirements for oil production facility to address concerns raised
by the production sector, respectively.
    Overall, EPA estimates that this proposed action would reduce
annual compliance costs by approximately $387 million for owners and
operators of affected facilities. Total costs were annualized over a
10-year period using a 7 percent discount rate. EPA derived these
savings by estimating the number of facilities affected by each
proposed amendment; identifying the specific behavioral changes that
may occur (e.g., choosing to prepare an SPCC Plan template instead of a
full SPCC Plan); estimating the unit costs of compliance measures under
the baseline and proposed scenarios; and applying the change in unit
costs to the projected number of affected facilities.
    EPA has therefore concluded that this proposed rule would relieve
regulatory burden for small entities and therefore, certify that this
proposed action will not have a significant economic impact on a
substantial number of small entities.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector. Under section 202 of UMRA, EPA
generally must prepare a written statement, including a cost-benefit
analysis, for proposed and final rules with ``Federal mandates'' that
may result in expenditures to State, local, and tribal governments, in
the aggregate, or to the private sector, of $100 million or more in any
one year. Before promulgating an EPA rule for which a written statement
is needed, section 205 of UMRA generally requires EPA to identify and
consider a reasonable number of regulatory alternatives and adopt the
least costly, most cost-effective, or least burdensome alternative that
achieves the objectives of the rule. The provisions of section 205 do
not apply when they are inconsistent with applicable law. Moreover,
section 205 allows EPA to adopt an alternative other than the least
costly, most cost-effective, or least burdensome alternative if the
Administrator publishes with the rule an explanation why that
alternative was not adopted.
    Before EPA establishes any regulatory requirements that may
significantly or uniquely affect small governments, including tribal
governments, it must have developed under section 203 of UMRA a small
government agency plan. The plan must provide for notifying potentially
affected small governments, enabling officials of affected small
governments to have meaningful and timely input in the development of
EPA regulatory proposals with significant Federal intergovernmental
mandates, and informing, educating, and advising small governments on
compliance with the regulatory requirements.
    EPA has determined that this proposed rule does not contain a
Federal mandate that may result in expenditures of $100 million or more
for State, local, and tribal governments, in the aggregate, or the
private sector in any one year. This proposed action would reduce
compliance costs on owners and operators of affected facilities by
approximately $387 million annually, although EPA acknowledges this
total estimate is derived from analyses of individual major components
of the proposed rule that are not necessarily additive, given that they
do not account for interactions among the various components. Thus,
this proposed rule is not subject to the requirements of sections 202
and 205 of the UMRA.
    EPA has determined that this proposed rule contains no regulatory
requirements that might significantly or uniquely affect small
governments. As explained above, the effect of the proposed rule would
be to reduce burden for facility owners and operators, including
certain small governments that are subject to the rule.

E. Executive Order 13132--Federalism
     Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August
10, 1999), requires EPA to develop an accountable process to ensure
``meaningful and timely input by State and local officials in the
development of regulatory policies that have federalism implications.''
``Policies that have federalism implications'' is defined in the
Executive Order to include regulations that 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.''
    This proposed rule 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,
as specified in Executive Order 13132. Under CWA section 311(o), States
may impose additional requirements, including more stringent
requirements, relating to the prevention of oil discharges to navigable
waters and adjoining shorelines. EPA recognizes that some States have
more stringent requirements (56 FR 54612, October 22, 1991). This
proposed rule would not preempt State law or regulations. Thus,
Executive Order 13132 does not apply to this proposed rule.

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

    Executive Order 13175, entitled ``Consultation and Coordination 
	with Indian Tribal Governments'' (59 FR 22951, November 9, 2000),
requires EPA to develop an accountable process to ensure ``meaningful
and timely input by tribal officials in the development of regulatory
policies that have tribal implications.'' This proposed rule does not
have tribal implications, as specified in Executive Order 13175. This
proposed rule would not significantly or uniquely affect communities of
Indian trial governments. Thus, Executive Order 13175 does not apply to
this proposed rule.

G. Executive Order 13045 Protection of Children From Environmental
Health &amp; Safety Risks

    Executive Order 13045,``Protection of Children from Environmental health 
	Risks and Safety Risks'' (62 FR 19885, April 23, 1997) applies
to any rule that: (1) Is determined to be ``economically significant''
as defined under Executive Order 12866, and (2) concerns an
environmental health or safety risk that EPA has reason to believe may
have a disproportionate effect on children. If the regulatory action
meets both criteria, the Agency must evaluate the environmental health
or safety effects of the planned rule on children, and explain why the
planned regulation is preferable to other potentially effective and
reasonably feasible alternatives considered by the Agency.
    EPA interprets Executive Order 13045 as applying only to those
regulatory actions that are based on health or safety risks, such that
the analysis required under section 5-501 of the Order has the
potential to influence the regulation. This proposed rule is not
subject to Executive Order 13045 because it does not establish an
environmental standard intended to mitigate health or safety risks.

[[Page 58427]]

H. Executive Order 13211--Actions That Significantly Affect Energy
Supply, Distribution, or Use

    This proposed rule is not a ``significant energy action'' as
defined in Executive Order 13211, ``Actions Concerning Regulations that
Significantly Affect Energy Supply, Distribution, or Use'' 
(66 FR 28355, May 22, 2001) because it is not likely to have a significant
adverse effect on the supply, distribution, or use of energy. The
overall effect of the proposed rule is to decrease the regulatory
burden on facility owners or operators subject to its provisions.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law 104-113, section 12(d) (15 U.S.C.
272 note) directs EPA to use voluntary consensus standards in its
regulatory activities unless to do so would be inconsistent with
applicable law or otherwise impractical. Voluntary consensus standards
are technical standards such as materials specifications, test methods,
sampling procedures, and business practices that are developed or
adopted by voluntary consensus standards bodies. The NTTAA directs EPA
to provide Congress, through OMB, explanations when the Agency decides
not to use available and applicable voluntary consensus standards.
    The owner or operator of a facility subject to the SPCC rule has
the flexibility to consider applicable industry standards in the
development of an SPCC Plan, in accordance with good engineering
practice. However, this proposed rulemaking does not involve technical
standards, as it does not set or incorporate by reference any one
specific technical standard. Therefore, the NTTAA does not apply. EPA
welcomes comments on this aspect of the proposed rulemaking and,
specifically, invites the public to identify potentially applicable
voluntary consensus standards and to explain why such standards should
be used in this regulation.

List of Subjects in 40 CFR Part 112

    Environmental protection, Animal fats and vegetable oils, Hot-mix
Asphalt, Farms, Flammable and combustible materials, Integrity testing,
Loading racks, Materials handling and storage, Natural gas, Oil
pollution, Oil and gas exploration and production, Oil spill response,
Penalties, Petroleum, Reporting and recordkeeping requirements,
Secondary containment, Security, Tanks, Unloading racks, Water
pollution control, Water resources.

    Dated: October 1, 2007.
Stephen L. Johnson,
Administrator.

    For the reasons stated in the preamble, title 40, chapter I, part
112 of the Code of Federal Regulations is proposed to be amended as
follows:

PART 112--OIL POLLUTION PREVENTION

    1. The authority citation for part 112 continues to read as follows:

    Authority: 33 U.S.C. 1251 et seq.; 33 U.S.C. 2720; and E.O.
12777 (October 18, 1991), 3 CFR, 1991 Comp., p. 351.

Subpart A--[Amended]

    2. Amend Sec.  112.1 as follows:
    a. By revising paragraphs (d)(2)(i) and (d)(2)(ii).
    b. By revising paragraph (d)(4).
    c. By adding paragraphs (d)(8) through (d)(10).

Sec.  112.1  General applicability.

* * * * *
    (d) * * *
    (2) * * *
    (i) The completely buried storage capacity of the facility is
42,000 gallons or less of oil. For purposes of this exemption, the
completely buried storage capacity of a facility excludes the capacity
of a completely buried tank, as defined in Sec.  112.2, and connected
underground piping, underground ancillary equipment, and containment
systems, that is currently subject to all of the technical requirements
of part 280 of this chapter or all of the technical requirements of a
State program approved under part 281 of this chapter, or which, in the
case of a nuclear power generation facility, meets the Nuclear
Regulatory Commission design criteria at 10 CFR part 50, Appendices A
and B. The completely buried storage capacity of a facility also
excludes the capacity of a container that is ``permanently closed,'' as
defined in Sec.  112.2.
    (ii) The aggregate aboveground storage capacity of the facility is
1,320 gallons or less of oil. For the purposes of this exemption, only
containers with a capacity of 55 gallons or greater are counted. The
aggregate aboveground storage capacity of a facility excludes: the
capacity of a container that is ``permanently closed'' and the capacity
of a ``motive power container'' as defined in Sec.  112.2; the capacity
of hot-mix asphalt or any hot-mix asphalt container; the capacity of a
container for heating oil used solely at a single-family residence; and
the capacity of pesticide application equipment and related mix
containers used at farms.
* * * * *
    (4) Any completely buried storage tank, as defined in Sec.  112.2,
and connected underground piping, underground ancillary equipment, and
containment systems, at any facility, that is subject to all of the
technical requirements of part 280 of this chapter or a State program
approved under part 281 of this chapter or which, in the case of a
nuclear power generation facility, meets the Nuclear Regulatory
Commission design criteria at 10 CFR part 50, Appendices A and B,
except that such a tank must be marked on the facility diagram as
provided in Sec.  112.7(a)(3), if the facility is otherwise subject to
this part.
* * * * *
    (8) Hot-mix asphalt, or any hot-mix asphalt container.
    (9) Any container for heating oil used solely at a single-family
residence.
    (10) Any pesticide application equipment or related mix containers
used at farms.
* * * * *
    3. Amend Sec.  112.2 by revising the definitions for ``Facility'',
``Production facility'', and adding a definition for ``Loading/
unloading rack'' in alphabetical order to read as follows:

Sec.  112.2  Definitions.

* * * * *
    Facility means any mobile or fixed, onshore or offshore building,
property, parcel, lease, structure, installation, equipment, pipe, or
pipeline (other than a vessel or a public vessel) used in oil well
drilling operations, oil production, oil refining, oil storage, oil
gathering, oil processing, oil transfer, oil distribution, and oil
waste treatment, or in which oil is used, as described in Appendix A to
this part. The boundaries of a facility depend on several site-specific
factors, including but not limited to, the ownership or operation of
buildings, structures, and equipment on the same site and types of
activity at the site. Contiguous or non-contiguous buildings,
properties, parcels, leases, structures, installations, pipes, or
pipelines under the ownership or operation of the same person may be
considered separate facilities. Only this definition governs whether a
facility is subject to this part.
* * * * *
    Loading/unloading rack means a structure necessary for loading or
unloading a tank truck or tank car, which is located at a facility
subject to

[[Page 58428]]

the requirements of this part. A loading/unloading rack includes a
platform, gangway, or loading/unloading arm; and any combination of the
following: piping assemblages, valves, pumps, shut-off devices,
overfill sensors, or personnel safety devices.
* * * * *
    Production facility means all structures (including but not limited
to wells, platforms, or storage facilities), piping (including but not
limited to flowlines or gathering lines), or equipment (including but
not limited to workover equipment, separation equipment, or auxiliary
non-transportation-related equipment) used in the production,
extraction, recovery, lifting, stabilization, separation or treating of
oil, or associated storage or measurement, and may be located in a
single geographical oil or gas field operated by a single operator.
This definition governs whether a facility is subject to a specific
section of this part.
* * * * *
    4. Amend Sec.  112.3 as follows:
    a. By revising the introductory text.
    b. By revising paragraph (b)(1).
    c. By adding paragraph (b)(3).
    d. Revising paragraph (g).

Sec.  112.3  Requirement to prepare and implement a Spill Prevention,
Control, and Countermeasure Plan.

    The owner of operator of an onshore or offshore facility subject to
this section must prepare in writing and implement a Spill Prevention
Control and Countermeasure Plan (hereafter ``SPCC Plan'' or ``Plan),''
in accordance with Sec.  112.7 and any other applicable section of this
part.
* * * * *
    (b)(1) If you are the owner or operator of an onshore or offshore
facility (excluding oil production facilities) that becomes operational
after July 1, 2009, and could reasonably be expected to have a
discharge as described in Sec.  112.1(b), you must prepare and
implement a Plan before you begin operations.
* * * * *
    (3) If you are the owner or operator of an oil production facility
that becomes operational after July 1, 2009, and could reasonably be
expected to have a discharge as described in Sec.  112.1(b), you must
prepare and implement a Plan within six months after you begin operations.
* * * * *
    (g) Qualified Facilities. The owner or operator of a qualified
facility as defined in this subparagraph may self certify his or her
facility's Plan, as provided in Sec.  112.6. A qualified facility is
one that meets the following Tier I or Tier II qualified facility criteria:
    (1) A Tier I qualified facility meets all of the qualification
criteria in paragraph (g)(2) of this section and has no individual oil
storage container with a capacity greater than 5,000 U.S. gallons.
    (2) A Tier II qualified facility is one that:
    (i) Has an aggregate aboveground oil storage capacity of 10,000
U.S. gallons or less; and
    (ii) Has had no single discharge as described in Sec.  112.1(b)
exceeding 1,000 U.S. gallons or no two discharges as described in Sec. 
112.1(b) each exceeding 42 U.S. gallons within any twelve month period
in the three years prior to the SPCC Plan self-certification date, or
since becoming subject to this part if the facility has been in
operation for less than three years (other than discharges as described
in Sec.  112.1(b) that are the result of natural disasters, acts of
war, or terrorism).
    5. Revise Sec.  112.6 to read as follows:

Sec.  112.6  Qualified Facilities Plan Requirements.

    Qualified facilities meeting the Tier I applicability criteria in
Sec.  112.3(g)(1) are subject to either all of the requirements in
paragraph (a) of this section or all of the requirements in paragraph
(b) of this section. Facilities meeting the Tier II applicability
criteria in Sec.  112.3(g)(2) are subject to the requirements in
paragraph (b) of this section.
    (a) Tier I Qualified Facilities--(1) Preparation and Self-
Certification of the Plan. If you are an owner or operator of a
facility that meets the Tier I qualified facility criteria in Sec. 
112.3(g)(1), you may choose to prepare an SPCC Plan that meets the
requirements of paragraph (a)(3) of this section to serve as the Plan
for your facility, instead of preparing a Plan meeting requirements of
paragraph (b) of this section or the general Plan requirements in Sec. 
112.7 and applicable requirements in subparts B and C of this part,
including having the Plan certified by a Professional Engineer as
required under Sec.  112.3(d). The template in Appendix G to this part
has been developed to meet the requirements of 40 CFR part 112 and must
be used as the SPCC Plan. To complete the template in Appendix G, you
must certify that:
    (i) You are familiar with the applicable requirements of 40 CFR
part 112;
    (ii) You have visited and examined the facility;
    (iii) You prepared the Plan in accordance with accepted and sound
industry practices and standards;
    (iv) Procedures for required inspections and testing have been
established in accordance with industry inspection and testing
standards or recommended practices;
    (v) You will fully implement the Plan;
    (vi) The facility meets the qualification criteria in Sec. 112.3(g)(1);
    (vii) The Plan does not deviate from any requirement of this part
as allowed by 112.7(a)(2) and 112.7(d); and
    (viii) The Plan and individual(s) responsible for implementing this
Plan have the approval of management, and the facility owner or operator 
has committed the necessary resources to fully implement this Plan.
    (2) Technical Amendments. You must certify any technical amendments
to your Plan in accordance with paragraph (a)(1) of this section when
there is a change in the facility design, construction, operation, or
maintenance that affects its potential for a discharge as described in
Sec.  112.1(b). If the facility change results in the facility no
longer meeting the Tier I qualifying criteria in Sec.  112.3(g)(1)
because an individual oil storage container capacity exceeds 5,000 U.S.
gallons or the facility capacity exceeds 10,000 gallons in aggregate
aboveground storage capacity, within six months following preparation
of the amendment, you must either:
    (i) Prepare and implement a Plan in accordance with Sec.  112.6(b)
if you meet the Tier II qualified facility criteria in Sec. 112.3(g)(2), or
    (ii) Prepare and implement a Plan in accordance with the general
Plan requirements in Sec.  112.7, and applicable requirements in
subparts B and C of this part, including having the Plan certified by a
Professional Engineer as required under Sec.  112.3(d).
    (3) Plan Template and Applicable Requirements. The following
requirements under Sec.  112.7 and in subparts B and C of this part
apply to qualified Tier I facilities choosing the self-certification
Tier I option: Sec. Sec.  112.7(a)(3)(i), 112.7(a)(3)(iv),
112.7(a)(3)(vi), 112.7(a)(4), 112.7(a)(5), 112.7(c), 112.7(e),
112.7(f), 112.7(g), 112.7(k), 112.8(b)(1), 112.8(b)(2), 112.8(c)(1),
112.8(c)(3), 112.8(c)(4), 112.8(c)(5), 112.8(c)(6), 112.8(c)(10),
112.8(d)(4), 112.9(b), 112.9(c), 112.9(d)(1), 112.9(d)(3), 112.9(d)(4),
112.10(b), 112.10(c), 112.10(d), 112.12(b)(1), 112.12(b)(2),
112.12(c)(1), 112.12(c)(3), 112.12 (c)(4), 112.12(c)(5), 112.12(c)(6),
112.12(c)(10), and 112.12(d)(4). Additionally, you must meet the
following requirements:
    (i) Failure analysis, in lieu of the requirements in Sec. 
112.7(b). Where experience indicates a reasonable potential for
equipment failure (such as loading or unloading equipment, tank
overflow, rupture, or leakage, or any

[[Page 58429]]

other equipment known to be a source of discharge), include in your
Plan a prediction of the direction and total quantity of oil which
could be discharged from the facility as a result of each type of major
equipment failure.
    (ii) Bulk storage container secondary containment, in lieu of the
requirements in Sec. Sec.  112.8(c)(2) and (c)(11) and 112.12(c)(2) and
(c)(11). Construct all bulk storage container installations, including
mobile or portable oil storage containers, so that you provide a
secondary means of containment for the entire capacity of the largest
single container plus additional capacity to contain precipitation.
Dikes, containment curbs, and pits are commonly employed for this
purpose. You may also use an alternative system consisting of a
drainage trench enclosure that must be arranged so that any discharge
will terminate and be safely confined in a catchment basin or holding
pond. Position or locate mobile or portable oil storage containers to
prevent a discharge as described in Sec.  112.1(b).
    (iii) Overfill prevention, in lieu of the requirements in
Sec. Sec.  112.8(c)(8) and 112.12(c)(8). Ensure that each container is
provided with a system or documented procedure to prevent overfills of
the container, describe the system or procedure in the SPCC Plan and
regularly test to ensure proper operation or efficacy.
    (b) Tier II Qualified Facilities--(1) Preparation and Self-
Certification of Plan. If you are the owner or operator of a facility
that meets the Tier II qualified facility criteria in Sec. 
112.3(g)(2), you may choose to self-certify your Plan. You must certify
in the Plan that:
    (i) You are familiar with the requirements of this part;
    (ii) You have visited and examined the facility;
    (iii) The Plan has been prepared in accordance with accepted and
sound industry practices and standards, and with the requirements of
this part;
    (iv) Procedures for required inspections and testing have been
established;
    (v) You will fully implement the Plan;
    (vi) The facility meets the qualification criteria set forth under
Sec.  112.3(g)(2);
    (vii) The Plan does not deviate from any requirement of this part
as allowed by Sec.  112.7(a)(2) and 112.7(d), except as provided in
paragraph (b)(3) of this section; and
    (viii) The Plan and individual(s) responsible for implementing the
Plan have the full approval of management and the facility owner or
operator has committed the necessary resources to fully implement the Plan.
    (2) Technical Amendments. If you self-certify your Plan pursuant to
(b)(1) of this section, you must certify any technical amendments to
your Plan in accordance with paragraph (b)(1) of this section when
there is a change in the facility design, construction, operation, or
maintenance that affects its potential for a discharge as described in
Sec.  112.1(b), except:
    (i) If a Professional Engineer certified a portion of your Plan in
accordance with paragraph (b)(4) of this section, and the technical
amendment affects this portion of the Plan, you must have the amended
provisions of your Plan certified by a Professional Engineer in
accordance with paragraph (b)(4)(ii) of this section.
    (ii) If the change is such that the facility no longer meets the
Tier II qualifying criteria in Sec.  112.3(g)(2) because it exceeds
10,000 gallons in aggregate aboveground storage capacity you must,
within six months following the change, prepare and implement a Plan in
accordance with the general Plan requirements in Sec.  112.7 and the
applicable requirements in subparts B and C of this part, including
having the Plan certified by a Professional Engineer as required under
Sec.  112.3(d).
    (3) Applicable Requirements. Except as provided in this
subparagraph, your self-certified SPCC Plan must comply with Sec. 
112.7 and the applicable requirements in subparts B and C of this part:
    (i) Environmental Equivalence. Your Plan may not include alternate
methods which provide environmental equivalence pursuant to Sec. 
112.7(a)(2), unless each alternate method has been reviewed and
certified in writing by a Professional Engineer, as provided in
paragraph (b)(4) of this section.
    (ii) Impracticability. Your Plan may not include any determinations
that secondary containment is impracticable and provisions in lieu of
secondary containment pursuant to Sec.  112.7(d), unless each such
determination and alternate measure has been reviewed and certified in
writing by a Professional Engineer, as provided in paragraph (b)(4) of
this section.
    (4) Professional Engineer Certification of Portions of a Qualified
Facility's Self-certified Plan. As described in paragraph (b)(3) of
this section, the facility owner or operator may not self-certify
alternative measures allowed under Sec.  112.7(a)(2) or (d), that are
included in the facility's Plan. Such measures must be reviewed and
certified, in writing, by a licensed Professional Engineer as follows:
    (i) For each alternative measure allowed under Sec.  112.7(a)(2),
the Plan must be accompanied by a written statement by a Professional
Engineer that states the reason for nonconformance and describes the
alternative method and how it provides equivalent environmental
protection in accordance with Sec.  112.7(a)(2). For each determination
of impracticability of secondary containment pursuant to Sec. 
112.7(d), the Plan must clearly explain why secondary containment
measures are not practicable at this facility and provide the alternative 
measures required in Sec.  112.7(d) in lieu of secondary containment.
    (ii) By certifying each measure allowed under Sec.  112.7(a)(2) and
(d), the Professional Engineer attests:
    (A) That he is familiar with the requirements of this part;
    (B) That he or his agent has visited and examined the facility; and
    (C) That the alternative method of environmental equivalence in
accordance with Sec.  112.7(a)(2) or the determination of
impracticability and alternative measures in accordance with Sec. 
112.7(d) is consistent with good engineering practice, including
consideration of applicable industry standards, and with the
requirements of this part.
    (iii) The review and certification by the Professional Engineer
under this paragraph is limited to the alternative method which
achieves equivalent environmental protection pursuant to Sec. 
112.7(a)(2) or to the impracticability determination and measures in
lieu of secondary containment pursuant to Sec.  112.7(d).
    6. Amend Sec.  112.7 as follows:
    a. By revising paragraphs (a)(3) introductory text and (a)(3)(i).
    b. By revising paragraphs (c) introductory text and (c)(1).
    c. Revising paragraph (g).
    d. Revising paragraphs (h) introductory text, (h)(1) and (h)(2).

Sec.  112.7  General requirements for Spill Prevention, Control, and
Countermeasure Plans.

* * * * *
    (a) * * *
    (3) Describe in your Plan the physical layout of the facility and
include a facility diagram, which must mark the location and contents
of each fixed oil storage container and the storage area where mobile
or portable containers are located. The facility diagram must include
completely buried tanks that are otherwise exempted from the
requirements of this part under Sec.  112.1(d)(4). The facility diagram
must also include all transfer stations and

[[Page 58430]]

connecting pipes. You must also address in your Plan:
    (i) The type of oil in each fixed container and its storage
capacity. For mobile or portable containers, either provide the type of
oil and storage capacity for each container or provide an estimate of
the potential number of mobile or portable containers, the types of
oil, and anticipated storage capacities;
* * * * *
    (c) Provide appropriate containment and/or diversionary structures
or equipment to prevent a discharge as described in Sec.  112.1(b),
except for flowlines and intra-facility gathering lines at an oil
production facility, and except as provided in paragraph (k) of this
section for qualified oil-filled operational equipment. The entire
containment system, including walls and floor, must be capable of
containing oil and must be constructed so that any discharge from a
primary containment system, such as a tank, will not escape the
containment system before cleanup occurs. In determining the method,
design, and capacity for secondary containment, you need only to
address the typical failure mode, and the most likely quantity of oil
that would be discharged. Secondary containment may be either active or
passive in design. At a minimum, you must use one of the following
prevention systems or its equivalent:
    (1) For onshore facilities:
    (i) Dikes, berms, or retaining walls sufficiently impervious to
contain oil;
    (ii) Curbing or drip pans;
    (iii) Sumps and collection systems;
    (iv) Culverting, gutters, or other drainage systems;
    (v) Weirs, booms, or other barriers;
    (vi) Spill diversion ponds;
    (vii) Retention ponds; or
    (viii) Sorbent materials.
* * * * *
    (g) Security (excluding oil production facilities). Describe in
your Plan how you secure and control access to the oil handling,
processing and storage areas; secure master flow and drain valves;
prevent unauthorized access to starter controls on oil pumps; secure
out-of-service and loading/unloading connections of oil pipelines;
address the appropriateness of security lighting to both prevent acts
of vandalism and assist in the discovery of oil discharges.
    (h) Facility tank car and tank truck loading/unloading rack
(excluding offshore facilities, farms, and oil production facilities).
(1) Where loading/unloading rack drainage does not flow into a
catchment basin or treatment facility designed to handle discharges,
use a quick drainage system for tank car or tank truck loading/
unloading racks. You must design any containment system to hold at
least the maximum capacity of any single compartment of a tank car or
tank truck loaded or unloaded at the facility.
    (2) Provide an interlocked warning light or physical barrier
system, warning signs, wheel chocks or vehicle brake interlock system
in the area adjacent to a loading/unloading rack, to prevent vehicles
from departing before complete disconnection of flexible or fixed oil
transfer lines.
* * * * *

Subpart B--[Amended]

    7. Amend Sec.  112.8 by revising paragraph (c)(6) to read as follows:

Sec.  112.8  Spill Prevention, Control, and Countermeasure Plan
requirements for onshore facilities (excluding oil production
facilities).

* * * * *
    (c) * * *
    (6) Test or inspect each aboveground container for integrity on a
regular schedule and whenever you make material repairs. You must
determine, in accordance with industry standards, the appropriate
qualifications for personnel performing tests and inspections, the
frequency and type of testing and inspections, which take into account
container size, configuration, and design (e.g., containers that are:
shop-built, field-erected, skid-mounted, elevated, equipped with a
liner, double-walled, or partially buried). Examples of these integrity
tests include, but are not limited to: visual inspection, hydrostatic
testing, radiographic testing, ultrasonic testing, acoustic emissions
testing, or other systems of non-destructive testing. You must keep
comparison records and you must also inspect the container's supports
and foundations. In addition, you must frequently inspect the outside
of the container for signs of deterioration, discharges, or
accumulation of oil inside diked areas. Records of inspections and
tests kept under usual and customary business practices satisfy the
recordkeeping requirements of this paragraph (c)(6).
* * * * *
    8. Amend Sec.  112.9 as follows:
    a. By revising the section heading.
    b. By revising the introductory text.
    c. By revising paragraphs (c)(2) and (c)(3).
    d. By adding paragraph (c)(5).
    e. By revising paragraph (d)(3).
    f. By adding paragraph (d)(4).

Sec.  112.9  Spill Prevention, Control, and Countermeasure Plan
Requirements for onshore oil production facilities (excluding drilling
and workover facilities).

    If you are the owner or operator of an onshore oil production
facility (excluding a drilling or workover facility), you must:
* * * * *
    (c) * * *
    (2) Construct all tank battery, separation, and treating facility
installations, except for flow-through process vessels, so that you
provide a secondary means of containment for the entire capacity of the
largest single container and sufficient freeboard to contain
precipitation.
    You must safely confine drainage from undiked areas in a catchment
basin or holding pond.
    (3) Except for flow-through process vessels, periodically and upon
a regular schedule visually inspect each container of oil for
deterioration and maintenance needs, including the foundation and
support of each container that is on or above the surface of the ground.
* * * * *
    (5) Flow-through process vessels. (i) In lieu of the requirements
in paragraph (c)(3) of this section, periodically and on a regular
schedule visually inspect and/or test flow-through process vessels and
associated components (e.g., dump valves) for leaks, corrosion, or other 
conditions that could lead to a discharge as described in Sec. 112.1(b).
    (ii) Take corrective action or make repairs to flow-through process
vessels and any associated components as indicated by regularly
scheduled visual inspections, tests, or evidence of an oil discharge.
    (iii) Promptly remove any accumulations of oil discharges
associated with flow-through process vessels.
    (iv) If your facility discharges more than 1,000 U.S. gallons of
oil in a single discharge as described in Sec.  112.1(b), or discharges
more than 42 U.S. gallons of oil in each of two discharges as described
in Sec.  112.1(b) within any twelve month period, from flow-through
process vessels (excluding discharges that are the result of natural
disasters, acts of war, or terrorism) then you must, within six months
from the time the facility becomes subject to this paragraph, provide
flow-through process vessels with a secondary means of containment for
the entire capacity of the largest single container and sufficient
freeboard to contain precipitation.
    (d) * * *
    (3) For flowlines and intra-facility gathering lines, unless you have

[[Page 58431]]

submitted a response plan under Sec.  112.20, provide in your Plan the
following:
    (i) An oil spill contingency plan following the provisions of part
109 of this chapter.
    (ii) A written commitment of manpower, equipment, and materials
required to expeditiously control and remove any quantity of oil
discharged that might be harmful.
    (4) Prepare and implement a written program of flowline/intra-
facility gathering line maintenance. The maintenance program must
address your procedures to:
    (i) Ensure that flowlines and intra-facility gathering lines and
associated valves and equipment must be compatible with the type of
production fluids, their potential corrosivity, volume, and pressure,
and other conditions expected in the operational environment.
    (ii) Visually inspect and/or test flowlines and intra-facility
gathering lines and associated appurtenances on a periodic and regular
schedule for leaks, oil discharges, corrosion, or other conditions that
could lead to a discharge as described in Sec.  112.1(b). The frequency
and type of testing must allow for the implementation of a contingency
plan as described under part 109 of this chapter.
    (iii) Take corrective action or make repairs to any flowlines and
intra-facility gathering lines and associated appurtenances as
indicated by regularly scheduled visual inspections, tests, or evidence
of a discharge.
    (iv) Promptly remove any accumulations of oil discharges associated
with flowlines, intra-facility gathering lines, and associated
appurtenances.

Subpart C--[Amended]

    9. Amend Sec.  112.12 by revising the introductory text and
paragraph (c)(6) to read as follows:

Sec.  112.12  Spill Prevention, Control, and Countermeasure Plan
Requirements.

    If you are the owner or operator of an onshore facility, you must:
* * * * *
    (c) * * *
    (6) Bulk storage container inspections. (i) Except for containers
that meet the criteria provided in paragraph (c)(6)(ii) of this
section, test or inspect each aboveground container for integrity on a
regular schedule and whenever you make material repairs. You must
determine, in accordance with industry standards, the appropriate
qualifications for personnel performing tests and inspections, the
frequency and type of testing and inspections, which take into account
container size, configuration, and design (e.g., containers that are:
shop-built, field-erected, skid-mounted, elevated, equipped with a
liner, double-walled, or partially buried). Examples of these integrity
tests include, but are not limited to: visual inspection, hydrostatic
testing, radiographic testing, ultrasonic testing, acoustic emissions
testing, or other systems of non-destructive testing. You must keep
comparison records and you must also inspect the container's supports
and foundations. In addition, you must frequently inspect the outside
of the container for signs of deterioration, discharges, or
accumulation of oil inside diked areas. Records of inspections and
tests kept under usual and customary business practices satisfy the
recordkeeping requirements of this paragraph.
    (ii) For bulk storage containers that are subject to 21 CFR part
110, are elevated, constructed of austenitic stainless steel, have no
external insulation, and are shop-fabricated, conduct formal visual
inspection on a regular schedule. In addition, you must frequently
inspect the outside of the container for signs of deterioration,
discharges, or accumulation of oil inside diked areas. You must
determine and document in the Plan the appropriate qualifications for
personnel performing tests and inspections. Records of inspections and
tests kept under usual and customary business practices satisfy the
recordkeeping requirements of this paragraph (c)(6).
* * * * *
    10. Add Appendix G to part 112 to read as follows:

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[FR Doc. E7-19701 Filed 10-12-07; 8:45 am]
BILLING CODE 6560-50-C
Notices For
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
Oil Pollution Prevention; Spill Prevention, Control, and Countermeasure Rule Requirements--Amendments

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