Document Eqx79b5KN0qp8Y80Mx5o0q4yV

In the Matter of: XTO Energy, Inc. Midland, Texas Respondent UNITED STATES ENVIRONMENTAL PROTECTION AGENCY REGION 6 BEFORE THE ADMINISTRATOR ) ) ) EPA Docket No. CAA-06-2021-3324 ) ) ) ) ADMINISTRATIVE COMPLIANCE ORDER ON CONSENT The following Administrative Compliance Order on Consent ("Consent Order") is issued pursuant to the authority of Section 113(a)(1)(A) of the Clean Air Act, 42 U.S.C. 7413(a)(1)(A) (hereinafter referred to as "the Act" or the "CAA"). Section 113(a)(1) of the Act authorizes the Administrator of the United States Environmental Protection Agency ("EPA") to issue an order requiring compliance to any person whom the Administrator finds to be in violation of the Act. The authority to issue this Consent Order has been delegated to the Regional Administrator of EPA Region 6 and re-delegated to the Director of the Enforcement and Compliance Assurance Division, EPA Region 6. STATUTORY AND REGULATORY BACKGROUND 1. The Act is designed "to protect and enhance the quality of the Nation's air resources so as to promote the public health and welfare and the productive capacity of its population." CAA 101(b)(1), 42 U.S.C. 7401(b)(1). 2. EPA is authorized by Section 113 of the CAA, 42 U.S.C. 7413, to take action to ensure that air pollution sources comply with all federally applicable air pollution control XTO Energy, Inc. Docket No. CAA-06-2021-3324 requirements. These include requirements promulgated by EPA and those contained in SIPs and federally-enforceable permits. General Construction Permits Issued Under the New Mexico State Implementation Plan 3. Section 109(a) of the CAA, 42 U.S.C. 7409(a), requires the Administrator of EPA to publish national ambient air quality standards ("NAAQS") for certain air pollutants. Section 109(b) of the CAA, 42 U.S.C. 7409(b), provides that the NAAQS establish primary air quality standards to protect public health and secondary standards to protect public welfare. 4. To achieve the objectives of the NAAQS and the Act, Section 110(a) of the CAA, 42 U.S.C. 7410(a), requires each State to adopt a state implementation plan ("SIP") that provides for the implementation, maintenance, and enforcement of the NAAQS, and to submit it to the Administrator of EPA for approval. 5. The State of New Mexico has adopted a SIP that has been approved by EPA. See 40 C.F.R. Part 52, Subpart GG. The New Mexico SIP includes authorization for New Mexico to issue general construction permits to oil and gas facilities. See 20 N.M.A.C. 2.72.220. 6. Facilities "registered for coverage under a general permit shall be generally homogeneous in terms of operations, processes and emissions, subject to the same or substantially similar requirements and not subject to case-by-case standards or requirements." Id. 7. To demonstrate compliance with allowable emissions limitations, New Mexico Air Quality Bureau General Construction Permit for Oil and Gas Facilities ("GCP-O&G") Part A205(B) requires the permittee to operate the permitted facility's control device and/or vapor recovery units "as a closed vent system that captures and routes all emissions from tanks back to the process stream or to the control device, and does not vent to the atmosphere." GCP-O&G Part A205(B). Page 2 of 12 XTO Energy, Inc. Docket No. CAA-06-2021-3324 8. GCP-O&G Part A100(F) requires the permittee to operate the facility as specified in the facility's Registration Form. FINDINGS OF FACT AND CONCLUSIONS OF LAW 9. XTO Energy, Inc. ("XTO" or "Respondent") is a company doing business in the state of New Mexico. Respondent is a "person" within the meaning of Section 113(a) of the CAA, 42 U.S.C. 7413(a), and as defined in Section 302(e) of the CAA, 42 U.S.C. 7602(e). 10. At all times relevant to this Consent Order, Respondent has owned and/or operated the oil and natural gas production facilities listed in Attachment A, which are located in the New Mexico Permian Basin (the "Facilities") and emit volatile organic compounds (VOCs). 11. Respondent is the "owner or operator" of the Facilities within the meaning of 40 C.F.R. 51.100(f). 12. The Facilities are permitted under the State of New Mexico's General Construction Permits program for oil and gas facilities, located at 20 N.M.A.C. 2.72.220. 13. NMED issued air permits to Respondent, listed in Attachment A, under the SIPapproved General Construction Permits program. The permits cover various emission units at the Facilities, including tanks, fugitives, enclosed combustors, and flares. 14. Respondent is required by the Facilities' permits listed in Attachment A to control the emission of waste gas streams from the Facilities and to operate in compliance with certain provisions of the New Mexico SIP. 15. During September 10, 2019, through October 3, 2019, EPA contracted helicopter flyovers of the Permian Basin area to assess energy extraction facility emissions using Optical Gas Imaging ("OGI") technology. Page 3 of 12 XTO Energy, Inc. Docket No. CAA-06-2021-3324 16. Based upon its review of the images obtained during the flyovers and preliminary permit information available from online state databases for oil and gas facilities, EPA identified unauthorized emissions at facilities that EPA believed were owned or operated by Respondent. 17. On August 19, 2020, EPA emailed Respondent OGI video captures showing potentially unauthorized hydrocarbon emissions from process equipment, tanks, or vapor recovery systems at these facilities. EPA asked Respondent to verify ownership, provide current site-specific permit information, and take any necessary corrective action to address unauthorized hydrocarbon emissions at each facility. EPA considered information provided by Respondent to determine whether violations occurred at the Facilities. 18. On September 9, 2020, Respondent provided information to EPA that it has taken the following corrective action measures at the Facilities listed in Attachment A to address the compliance issues observed during the flyovers. Specifically, Respondent provided the following: a. Goldenchild Central Tank Battery: On January 20, 2020, Respondent cleaned and installed appropriate weights on the leaking tank pressure relief valve. Respondent also replaced one thief hatch, replaced three thief hatch springs, and cleaned all envelopes. b. PLU 158 Battery: On January 23, 2020, Respondent cleaned the leaking pressure relief valve. Respondent also replaced two thief hatch gaskets and replaced two thief hatch envelopes. c. Remuda 100 Tank Battery: On February 5, 2020, Respondent replaced three thief hatch envelopes, including the leaking thief hatch, and cleaned all others. Page 4 of 12 XTO Energy, Inc. Docket No. CAA-06-2021-3324 d. Remuda 500 Tank Battery: On October 4, 2019, Respondent properly latched the leaking thief hatch and replaced all base gaskets. 19. EPA has conducted a comprehensive review of the facility-specific information gathered based upon observations made from the OGI video captures, facility permitted operations, and information provided by Respondent. Based on this review, EPA has alleged the following findings for the Facilities: a. Respondent violated Part A205(B) of the Facilities' GCP-Oil & Gas permits by failing to route tank emissions to the process stream or to the control device, and not vent to atmosphere. b. Respondent violated Part A100(F) of the Facilities' GCP-Oil & Gas permits by failing to operate the Facilities as specified in the Facilities' Registration Forms. 20. More than thirty (30) days before the issuance of this Consent Order, Respondent was notified of the violations alleged herein. On December 7, 2020, EPA sent Respondent a Notice of Violation and Opportunity to Confer ("NOVOC") letter and provided a copy to the State of New Mexico, in accordance with Section 113(a)(1) of the CAA, 42 U.S.C. 7413(a)(1). 21. On January 26, 2021, Respondent and EPA Region 6 conferred regarding violations of the New Mexico SIP and the NOVOC. 22. The parties to this Consent Order agree that an opportunity to confer has been satisfied in accordance with Section 113(a)(4) of the CAA, 42 U.S.C. 7413(a)(4). 23. The parties further agree that in order to avoid protracted litigation, and in the best interest of all the parties and the environment, this Administrative Compliance Order will be entered into on Consent and by mutual agreement of the parties. 24. Only for the purposes of this proceeding, including any subsequent proceeding by EPA to enforce this document, Respondent admits the jurisdictional allegations contained herein; Page 5 of 12 XTO Energy, Inc. Docket No. CAA-06-2021-3324 however, Respondent neither admits nor denies the specific findings of fact and conclusions of law contained in this Consent Order. 25. Respondent also consents to and agrees not to contest EPA's jurisdiction to either issue this Consent Order or enforce its terms. Further, Respondent will not contest EPA's jurisdiction to either compel compliance with this Consent Order in any subsequent enforcement proceedings, whether administrative or judicial, or require Respondent's full compliance with the terms of this Consent Order or impose sanctions for violations of this Consent Order. Respondent consents to the terms of this Consent Order. ORDER ON CONSENT 26. Section 113(a)(1)(A) of the CAA, 42 U.S.C. 7413(a)(1)(A), provides in pertinent part that the Administrator may issue an Order requiring compliance with any requirement of a SIP. Pursuant to this authority, EPA has decided to issue this Consent Order after investigating all relevant facts, taking into account Respondent's compliance history, efforts made by Respondent to comply with applicable regulations, and based upon the foregoing Findings of Fact and Conclusions of Law herein. 27. Respondent has consented to, and is hereby ordered to satisfy, the following requirements regarding all Facilities listed in Attachment A: a. Within thirty (30) days of the Effective Date of this Consent Order, Respondent shall inspect and evaluate all oil and water storage tanks and associated hatches, valves, gaskets, and pressure relief devices at the Facilities to ensure there are no unauthorized emissions. b. Within thirty (30) days of the Effective Date of this Consent Order, Respondent shall inspect all flares at the Facilities to ensure that flares that are used for the control of emissions from production are properly operated and continuously lit during all facility operating scenarios where gases are routed to the enclosed combustors and/or flares. Page 6 of 12 XTO Energy, Inc. Docket No. CAA-06-2021-3324 c. Within ninety (90) days of the Effective Date of this Consent Order, Respondent shall review its operation and maintenance procedures for inspecting process equipment at each Facility, and update the procedures, as necessary, to ensure that problems are timely identified and addressed to minimize emissions from process equipment. If Respondent does not have such procedures, it shall create such procedures. Respondent shall ensure that these procedures include, at a minimum, the following: i. the use of a standard site inspection checklist during regular inspections that requires evaluation of the following: well pad, flares, separators, heater treaters, tank batteries, compressors, fuel skid, well heads, spill containment, solid waste and chemical storage, and miscellaneous facilitywide operations; ii. a quality control program that ensures the quality, efficiency, and performance of facility maintenance activities; and iii. appropriate and regular training for personnel implementing the operation and maintenance procedures. d. Within ninety (90) days from the review discussed in sub-paragraph c. above, Respondent shall send a letter to EPA detailing: i. the equipment that was inspected under sub-paragraph a. and b. above at each Facility, the method of inspection, and any actions taken, or improvements made to ensure or improve compliance; and ii. any updates that were made to the operation and maintenance procedures for the Facilities to ensure that problems are timely identified and addressed to minimize emissions from process equipment. 28. Any information or correspondence submitted by Respondent to EPA under this Consent Order shall be addressed to the following: Aimee Boss Air Permitting Enforcement Section (ECDAP) Enforcement and Compliance Assurance Division U.S. EPA - Region 6 1201 Elm Street, Suite 500 Dallas, Texas 75270 Phone: (214) 665-7397 Email: boss.aimee@epa.gov Page 7 of 12 XTO Energy, Inc. Docket No. CAA-06-2021-3324 29. To the extent this Consent Order requires Respondent to submit any information to EPA, Respondent may assert a business confidentiality claim covering part or all of that information, but only to the extent and only in the manner described in 40 C.F.R. 2.203. EPA will disclose information submitted under a confidentiality claim only as provided in 40 C.F.R. Part 2, Subpart B. See 41 Fed. Reg. 36,902 (Sept. 1, 1976). If Respondent does not assert a confidentiality claim, EPA may make the submitted information available to the public without further notice to Respondent. Emission data provided under Section 114 of the CAA, 42 U.S.C. 7414, is not entitled to confidential treatment under 40 C.F.R. Part 2, Subpart B. "Emission data" is defined in 40 C.F.R. 2.301(a)(2)(i). 30. By signing this Consent Order, Respondent acknowledges that this Consent Order will be available to the public and agrees that this Consent Order does not contain any confidential business information. GENERAL PROVISIONS 31. Pursuant to Section 113(a)(4) of the CAA, 42 U.S.C. 7413(a)(4), this Consent Order shall be effective when fully executed, as set forth below in Paragraph 49, shall not exceed a term of one year, and shall be nonrenewable. Upon completion of all injunctive relief requirements, Respondent may submit a completion report with a request that EPA issue a closeout letter. 32. The provisions of this Consent Order shall apply to and be binding upon Respondent, its officers, directors, agents, and employees solely in their capacity of acting on behalf of Respondent. 33. Respondent neither admits nor denies any of the factual or legal determinations made by EPA in this Consent Order. Page 8 of 12 XTO Energy, Inc. Docket No. CAA-06-2021-3324 34. The provisions of this Consent Order shall be transferable to any other party, upon sale or other disposition of the Facilities. Upon such action, the provisions of this Consent Order shall then apply to and be binding upon any new owner or operator, its officers, directors, agents, employees, and any successors in interest. 35. By signing this Consent Order, the undersigned representative of XTO certifies that he or she is fully authorized by Respondent to execute and enter into the terms and conditions of this Consent Order and has the legal capacity to bind Respondent to the terms and conditions of this Consent Order. 36. Nothing in this Consent Order shall be construed to prevent or limit EPA's civil and criminal authorities, or that of other Federal, State, or local agencies or departments to obtain compliance, penalties, or injunctive relief under any applicable Federal, State, or local laws or regulations, including the power of EPA to undertake any action against Respondent or any person in response to conditions that may present an imminent and substantial endangerment to the public health, welfare, or the environment. 37. Nothing contained in this Consent Order shall affect the responsibility of Respondent to comply with all other applicable Federal, State, or local laws or regulations, including Section 303 of the CAA, 42 U.S.C. 7603. 38. EPA does not waive any rights or remedies available to it for any violations by Respondent of Federal laws, regulations, statutes, or permitting programs. 39. Any and all information required to be maintained or submitted pursuant to this Consent Order is not subject to the Paperwork Reduction Act of 1995, 44 U.S.C. 3501 et seq., Page 9 of 12 XTO Energy, Inc. Docket No. CAA-06-2021-3324 because it seeks to collect information from specific entities to assure compliance with this administrative action. 40. By signing this Consent Order, Respondent certifies that the information it has supplied concerning this matter was at the time of submission, and is, to the best of its knowledge and belief, truthful, accurate, and complete for each submission, response, and statement. Respondent acknowledges that there are significant penalties for submitting false or misleading information, including the possibility of fines and imprisonment for knowing submission of such information, under 18 U.S.C. 1001. 41. EPA and Respondent agree to the use of electronic signatures for this matter. EPA and Respondent further agree to electronic service of this Consent Order by email to the following addresses: To EPA: lannen.justin@epa.gov To Respondent: james.hall@exxonmobil.com 42. EPA reserves all of its statutory and regulatory powers, authorities, rights, and remedies, both legal and equitable, which may pertain to Respondent's failure to comply with any of the requirements of this Consent Order. This Consent Order shall not be construed as a covenant not to sue, release, waiver, or limitation of any rights, remedies, powers, and/or authorities, civil or criminal, which EPA has under any statutory, regulatory, or common law authority of the United States. Page 10 of 12 XTO Energy, Inc. Docket No. CAA-06-2021-3324 43. This Consent Order does not resolve any civil or criminal claims of the United States for the violations alleged in this Consent Order; nor does it limit the rights of the United States to obtain penalties or injunctive relief under the Act or other applicable federal law or regulations. . 44. Respondent enters into this Consent Order in good faith without trial or adjudication of any issue of fact or law. 45. Respondent waives any and all remedies, claims for relief and otherwise available rights to judicial or administrative review that Respondent may have with respect to any issue of fact or law set forth in this Consent Order, including any right of judicial review under Section 307(b)(1) of the CAA, 42 U.S.C. 7607(b)(1). 46. The parties shall bear their own costs and fees in this action, including attorneys' fees. 47. For purposes of the identification requirement of Section 162(f)(2)(A)(ii) of the Internal Revenue Code, 26 U.S.C. 162(f)(2)(A)(ii), performance of Paragraph 27 is restitution or required to come into compliance with the law. FAILURE TO COMPLY 48. Failure to comply with this Consent Order may result in an enforcement action for appropriate injunctive relief as well as civil penalties pursuant to Section 113(b) of the CAA, 42 U.S.C. 7413(b) or, in appropriate cases, criminal penalties. Page 11 of 12 XTO Energy, Inc. Docket No. CAA-06-2021-3324 EFFECTIVE DATE 49. This Consent Order shall become effective upon the later of the two signatures below. __________ Date Digitally signed by Cannon, Richard E. (recanno) Cannon, Richard DN: cn=Cannon, Richard E. (recanno) ou=Standard Accounts e=rick.e.cannon@exxonmobil.com _______________________ E. (recanno) Reason: I agree to the terms defined by the placement of my signature in this document Location: Date: 2021-05-24 11:11-06:00 Rick E. Cannon Production Manager - New Mexico XTO Energy, Inc. Digitally signed by CHERYL SEAGER DN: c=US, o=U.S. Government, ou=Environmental Protection Agency, cn=CHERYL SEAGER, 0.9.2342.19200300.100.1.1=68001003651793 Date: 2021.05.27 10:14:55 -05'00' _______________________ Cheryl T. Seager Director Enforcement and Compliance Assurance Division U.S. EPA, Region 6 Page 12 of 12 CERTIFICATE OF SERVICE I hereby certify that a true and accurate copy of the foregoing Administrative Compliance Order on Consent was sent this day in the following manner to the addressee(s): Copy via Email to Respondent: james.hall@exxonmobil.com RICHARD Digitally signed by RICHARD LANNEN DN: c=US, o=U.S. Government, ou=Environmental Protection Agency, cn=RICHARD LANNEN, LANNEN 0.9.2342.19200300.100.1.1=68001003655726 Date: 2021.05.28 15:49:27 -05'00' _____________________________ U.S. EPA, Region 6 Dallas, Texas