List of Regulated Substances and Thresholds for Accidental Release Prevention; Proposed Amendments

SUMMARY: The Environmental Protection Agency (EPA) is proposing several

modifications to the rule listing regulated substances and threshold

quantities under section 112(r) of the Clean Air Act as amended. EPA is

proposing to delete the category of Division 1.1 explosives (as listed

by DOT) from the list of regulated substances. Regulated flammable

substances in gasoline used as fuel and in naturally occurring

hydrocarbon mixtures prior to initial processing are proposed for

exemption from threshold quantity determinations, and a clarification

of the provision for threshold determination of flammable substances in

a mixture is proposed. Modifications to the definition of stationary

source are proposed to clarify the exemption of transportation and

storage incident to transportation and to clarify that naturally

occurring hydrocarbon reservoirs are not stationary sources or parts of

stationary sources. In addition, EPA is clarifying that the Chemical

Accident Prevention Provisions do not apply to sources located on the

Outer Continental Shelf. EPA believes these proposed changes will

better focus accident prevention activities on stationary sources with

high hazard operations and reduce duplication with other similar

requirements.

DATES: Comments. Comments must be submitted on or before May 15, 1996

unless a hearing is requested by April 25, 1996. If a hearing is

requested, written comments must be received by May 30, 1996.

Public Hearing. Anyone requesting a public hearing must contact EPA

no later than April 25, 1996. If a hearing is held, it will take place

on April 30, 1996 at 9:30 a.m.

ADDRESSES: Comments. Comments should be mailed or submitted to:

Environmental Protection Agency, Air Docket (6102), Attn: Docket No. A-

96-O8, Waterside Mall, 401 M St. SW, Washington, DC 20460. Comments

must be submitted in duplicate. Comments may be submitted on disk in

WordPerfect or Word formats. If a public hearing is held, written

testimony should be submitted in duplicate at the time of the hearing.

Public Hearing. If a public hearing is held, it will be held at

Waterside Mall, 401 M St. SW, Washington, DC 20460, in the Conference

Center in a room to be designated. Persons interested in attending the

hearing or wishing to present oral testimony should notify by telephone

Vanessa Rodriguez (see For Further Information Contact).

Docket. The docket for this rulemaking is A-96-O8. This proposed

rule would amend a final rule, the docket for which is A-91-74. The

docket may be inspected between 8:00 am and 5:30 pm, Monday through

Friday at EPA's Air Docket, Room M1500, Waterside Mall, 401 M St. SW,

Washington, DC 20460; telephone (202) 260-7548. A reasonable fee may be

charged for copying.

FOR FURTHER INFORMATION CONTACT: Vanessa Rodriguez, Chemical Engineer,

Chemical Emergency Preparedness and Prevention Office, Environmental

Protection Agency, OS-120, 401 M St. SW, Washington, DC 20460, (202)

260-7913.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Introduction and Background

A. Statutory Authority

B. Background

C. Summary of Final Rule

II. Discussion of Proposed Modifications

A. Explosives

B. Regulated Flammable Substances in Gasoline and in Naturally

Occurring Hydrocarbon Mixtures

C. Clarification of Threshold Determination for Mixtures

Containing Flammable Substances

D. Definition of Stationary Source

E. Applicability to Outer Continental Shelf

III. Discussion of the Proposed Rule

IV. Required Analyses

A. E.O. 12866

B. Regulatory Flexibility Act

C. Paperwork Reduction Act

D. Unfunded Mandates

I. Introduction and Background

A. Statutory Authority

This notice of proposed rulemaking (NPRM) is being issued under

sections 112(r) and 301 of the Clean Air Act (Act) as amended (42

U.S.C. sections 7412(r) and 7601).

B. Background

The Clean Air Act (CAA or Act), section 112(r), contains

requirements related to prevention of accidental releases. The goal of

the accidental release provisions is to prevent accidental releases and

minimize the consequences of releases by focusing on those chemicals

and operations that pose the greatest risk. The CAA requires EPA to

promulgate an initial list of at least 100 substances (``regulated

substances'') that, in the event of an accidental release, are known to

cause or may be reasonably expected to cause death, injury, or serious

adverse effects to human health and the environment. The Act identifies

16 substances to be included in the initial list. Factors required to

be considered in listing substances are the severity of acute adverse

health effects associated with accidental releases of the substance,

the likelihood of accidental releases of the substance, and the

potential magnitude of human exposure to accidental releases of the

substance. The CAA also requires EPA to establish a threshold quantity

for each chemical at the time of listing. In developing these

thresholds, factors required to be considered include toxicity,

reactivity, volatility, dispersibility, combustibility, or flammability

of the substance and the amount of the substance which is known to

cause or can be reasonably anticipated to cause death, injury, or

serious adverse effects in case of a release. Stationary sources that

have more than a threshold quantity of a regulated substance are

subject to accident prevention regulations promulgated under CAA

section 112(r)(7), including the requirement to develop risk management

plans.

EPA's final rule on the list of substances and thresholds (59 FR

4478, January 31, 1994) (the ``List Rule'') promulgated the regulated

list of substances and thresholds that identify sources subject to the

accident prevention rules. EPA subsequently sought comment on a

proposed accident prevention (``risk management program'') rule in two

notices and intends to promulgate a final rule in late Spring 1996.

(See 58 FR 54190, October 20, 1993; 60 FR 13526, March 13, 1995.) For

additional information on the requirements of section 112(r) and

related statutory provisions, see these notices.

C. Summary of the List Rule

In the List Rule, EPA promulgated a list that includes 77 acutely

toxic substances, 63 flammable gases and volatile flammable liquids,

and Division 1.1 high explosive substances as listed by the United

States Department of Transportation (DOT) in 49 CFR 172.101. The final

rule establishes threshold quantities for toxic substances ranging from

500 to 20,000 pounds. For all listed flammable substances, the

threshold quantity is 10,000 pounds,

[[Page 16599]]

while all explosive substances have a threshold quantity of 5,000

pounds. The rule sets forth the procedures for determining whether a

threshold quantity of a regulated substance is present at a stationary

source. Specific exemptions for quantities considered in the threshold

determination are also included for mixtures, articles, and certain

uses and activities. The rule also specifies the requirements for any

petitions to the Agency requesting to add substances to, or delete

substances from, the list.

The criteria EPA considered in selecting substances for listing

include severity of acute adverse health effects, likelihood of

release, and potential magnitude of human exposure. EPA was required to

set threshold quantities for each regulated substance considering its

toxicity, reactivity, volatility, dispersibility, and flammability, as

well as amounts known or anticipated to cause effects of concern.

EPA selected commercially produced acutely toxic and volatile

substances mostly from the list of extremely hazardous substances

(EHSs) under section 302 of the Emergency Planning and Community Right-

to-Know Act (EPCRA). EPA chose volatile substances because they are

more likely to become airborne and impact the public. EPA also

considered accident history associated with a substance. One substance,

oleum, was listed because it has a history of accidents that have

impacted the public. Because vapor cloud explosions and blast waves

from detonations of high explosives have caused injuries to the public

and damage to the environment, EPA also included highly flammable gases

and liquids and high explosives on the list.

The American Petroleum Institute (API), the Institute of Makers of

Explosives (IME), and one other party filed petitions for judicial

review of the List Rule (American Petroleum Institute v. EPA, No. 94-

1273 (D.C. Cir.) and consolidated cases). On March 28, 1996, EPA made

available for public comment under CAA section 113(g) proposed

settlement agreements with API and IME (61 FR 13858, March 28, 1996).

II. Discussion of Proposed Modifications

Following EPA's promulgation of regulated substances and thresholds

in the List Rule, the petitioners mentioned above and other members of

the regulated community raised a number of issues concerning the list

and thresholds. Certain provisions of the List Rule that seemed

inconsistent with EPA's intent expressed in the preamble or other

documents supporting the final rule were identified. Additional

information was also received addressing the concerns that led to the

regulation. As a result, EPA is proposing the following amendments to

the final rule: delisting explosives; exempting from threshold

determination regulated flammable substances in gasoline and in

naturally occurring hydrocarbon mixtures prior to initial processing;

clarifying the provision for threshold determination of flammable

substances in mixtures to exempt mixtures that do not have a National

Fire Protection Association (NFPA) flammability hazard rating of 4;

modifying the definition of stationary source to clarify the exemption

of transportation and storage incident to transportation and to clarify

that naturally occurring hydrocarbon reservoirs are not stationary

sources or parts of stationary sources; and clarifying that the

chemical accident prevention provisions do not apply to sources located

on the Outer Continental Shelf (``OCS sources'').

A. Explosives

In the final rule (59 FR 4478, January 31, 1994), EPA included

explosives classified by DOT as Class 1, Division 1.1, and listed as

such in 49 CFR 172.101 (the Hazardous Materials Table) as regulated

substances with a threshold quantity of 5,000 pounds. Division 1.1

explosives were listed because of their potential to readily detonate,

causing offsite impacts. While acknowledging that explosives are

regulated by a number of other agencies, EPA maintained that public

safety would be enhanced if additional information about explosives,

such as hazard assessments, were available to emergency response

agencies and local emergency planners under section 112(r). EPA's

primary concern was that there were gaps in the existing regulatory

framework in the area of communication with emergency responders and

local planners because existing regulations and programs were not

comprehensive. EPA noted that public safety would be enhanced by

additional coordination between facilities handling explosives and the

local emergency planners and responders.

Subsequent to promulgation of the List Rule, IME provided EPA with

additional information about the extent of the regulatory gaps

discussed above, including coordination with emergency responders.

After additional review of other federal, state, and local laws and

regulations for explosives, as well as industry practices for

explosives manufacturing and storage, EPA has concluded that current

regulations and current and contemplated industry practices promote

safety and accident prevention in storage, handling, transportation,

and use of explosives. As a result, these regulations and practices

adequately protect the public and the environment from the hazards of

accidents involving explosives. Explosives are regulated by the Bureau

of Alcohol, Tobacco and Firearms (BATF), the Mine Safety and Health Act

(MSHA), the Occupational Safety and Health Act (OSHA), the Department

of Defense (DoD), the Department of Transportation (DOT), and state and

local agencies. BATF's American Table of Distances (ATD) specifies

distances for explosive storage from inhabited buildings, public

highways, and passenger railways; these distances are great enough to

ensure that an accidental explosion at a site that is in compliance

with the ATD should not produce blast waves that are hazardous to

people at distances where the public could be affected (the hazard to

which the public could be exposed if a site complies with the ATD is

significantly lower than that which the Agency would be protecting

against with its listing of Division 1.1 explosives at a 5,000-pound

threshold). Most facilities that manufacture or store explosives

already are required to develop emergency response plans and to provide

local emergency responders with copies of Material Safety Data Sheets

(MSDSs) or lists of materials with MSDSs, or to advise local emergency

responders regarding the type, quantity, and location of Division 1.1

explosives on site.

EPA's review of existing regulations and current industry practices

still indicates that public safety would be enhanced if some sites

handling explosives made additional information about explosives

available to emergency responders and planners. While EPA does not

believe there are many sites that are not already coordinating with

local authorities under other regulatory and voluntary programs, public

safety would be enhanced if there were additional coordination between

the remaining facilities handling explosives and the local emergency

planners and responders. To address the gaps EPA identified, IME has

developed suggested safety practices that would be adopted in due

course if EPA provides final consent to the proposed settlement

agreement. These actions would provide additional information and

enhance the coordination between explosives facilities and the

emergency planners and responders. IME member companies would post

signs at all

[[Page 16600]]

normal access routes stating, ``Danger. Never Fight Explosive Fires.

Explosives are stored on this site,'' and providing an emergency phone

number. Whenever a new Division 1.1 commercial explosives storage or

manufacturing location is established at a temporary job site, IME

member companies would notify Local Emergency Planning Committees and

other local authorities (e.g., fire departments and law enforcement

agencies) of the type, quantity, and location of explosives on site. At

Division 1.1 commercial explosives storage or manufacturing locations

with 5,000 pounds or more of Division 1.1 explosives (not including

temporary job sites) where preparation of emergency response plans is

not already required, IME member companies would prepare emergency

response plans, notify Local Emergency Planning Committees and other

local authorities of the type, quantity, and location of explosives on

site, provide the emergency response plans to local emergency

responders, and respond to reasonable requests for information from

said authorities. IME member companies also would inform their

customers of the contents of the Settlement Agreement and the actions

to be taken. IME would respond to reasonable requests from law

enforcement agencies and emergency responders for information

concerning the safe storage, distribution, and use of explosives. IME

also would distribute a letter to other non-IME commercial explosives

manufacturers, distributors, and users informing them of the Settlement

Agreement and actions to be taken. The Agency believes these actions

effectively close the remaining gap in emergency planning and response

communications, while allowing existing laws to prevail. Therefore, EPA

is proposing to delist explosives from the list of regulated substances

under section 112(r). EPA requests comments on whether explosives

should be delisted.

B. Regulated Flammable Substances in Gasoline and in Naturally

Occurring Hydrocarbon Mixtures

In the threshold determination provisions for mixtures containing

flammable regulated substances, the List Rule provides that such

mixtures are exempt if the owner or operator can demonstrate that the

mixture does not meet boiling point or flash point criteria; otherwise,

the entire mixture is treated as a regulated substance unless another

exemption applies. The boiling point and flash point are objectively

determinable and derived from the definition of highly flammable

liquids and gases, National Fire Protection Association (NFPA)

flammability hazard rating of 4. Although EPA did not specifically

exempt gasoline and naturally occurring hydrocarbon mixtures (e.g.,

crude oil) from threshold determination, it did not intend the List

Rule to cover regulated flammable substances in mixtures that do not

meet the NFPA 4 criteria. Gasoline and crude oil are listed with NFPA

flammability ratings of 3 in Fire Hazard Properties of Flammable

Liquids, Gases, and Volatile Solids, NFPA 325M (1991 edition). EPA

noted in Proposed List of Substances and Threshold for Accidental

Release Prevention: Summary and Response to Comments (1994) that it

believed gasoline does not meet the boiling point criterion for

listing. EPA also noted that it considered unlisted hydrocarbons that

fail to meet the NFPA 4 criteria to represent a lower priority for

accident prevention.

The NFPA criteria contain both the objective elements included in

EPA's rule as well as certain judgmental criteria. NFPA 4, as defined

in the NFPA Standard System for the Identification of Fire Hazards of

Materials, NFPA 704 (1990 edition), includes the following:

``Materials that will rapidly or completely vaporize at atmospheric

pressure and normal ambient temperature, and which will burn readily.

This degree usually includes:

Flammable gases;

Flammable cryogenic materials;

Any liquid or gaseous material that is liquid while under pressure

and has a flash point below 73 deg.F (22.8 deg.C) and a boiling point

below 100 deg.F (37.8 deg.C) (i.e., Class IA flammable liquids);

Materials that ignite spontaneously in air.''

Thus, the promulgated threshold determination provision does not

exempt mixtures that meet the flash point and boiling point criteria,

but that do not rapidly or completely vaporize and, therefore, are not

true NFPA 4 mixtures based on the full definition. In particular,

certain grades of gasoline and some naturally occurring hydrocarbon

mixtures might be subject to threshold determination under the

provisions of the final rule, based on the flash point and boiling

point criteria, even though these mixtures do not meet the judgmental

criteria of NFPA 4.

To better reflect EPA's original intent to exempt non-NFPA 4

mixtures and to clarify the regulatory status of gasoline and naturally

occurring hydrocarbon mixtures (e.g., crude oil and natural gas

condensate), EPA is proposing to provide specific exemptions from

threshold determination for regulated flammable substances in gasoline

used as fuel for internal combustion engines and for regulated

substances in naturally occurring hydrocarbon mixtures prior to initial

processing in a petroleum refining process unit or a natural gas

processing plant. Naturally occurring hydrocarbon mixtures would

include any or any combination of the following: condensate, crude oil,

field gas, and produced water. EPA is proposing definitions of these

substances for inclusion in the rule and is also proposing definitions

of petroleum refining process unit and natural gas processing plant.

EPA believes the proposed definitions reflect standard, widely accepted

meanings of these terms.

EPA believes gasoline and the naturally occurring hydrocarbon

mixtures condensate and crude oil, because they contain many non-

volatile components, have low potential for vapor cloud explosions (the

basis for listing flammable substances under CAA section 112(r)), even

if, in some cases, they may meet the flash point and boiling point

criteria cited in the final rule. Produced water in naturally occurring

hydrocarbon mixtures would likely reduce the flammability and potential

for vapor cloud explosion of these mixtures. EPA believes field gas,

prior to initial processing, also has low potential for vapor cloud

explosions that might have an impact on the public. Exploration and

production facilities likely do not have many congested areas or

confined spaces; congested areas or turbulent conditions (in an

advancing flame front) generally are necessary for a vapor cloud

explosion to occur. On-site processes are relatively simple, and there

are unlikely to be many ignition sources. The American Petroleum

Institute (API) evaluated the potential consequences of releases of

naturally occurring hydrocarbon mixtures at oil and gas exploration and

production facilities, as discussed in Hazard Assessment of Exploration

and Production Facilities Potentially Subject to the Environmental

Protection Agency's Risk Management Program Regulations (January 20,

1995) (see docket), and concluded that hazard distances were generally

very short for the types of facilities evaluated. Finally, EPA believes

these explicit, specific, and clear exemptions for gasoline and

naturally occurring hydrocarbons are useful in addition to revising the

flammable mixture provision to better reflect NFPA 4, because they

simplify the task of applying the judgmental criteria of NFPA 4 for

these pervasive mixtures.

[[Page 16601]]

As naturally occurring hydrocarbon mixtures undergo processing in a

petroleum refining process unit or a natural gas processing plant, the

potential for a vapor cloud explosion likely increases. The processes

are more complex, there may be significant on-site congestion from

buildings and equipment, flammable substance may be stored in large

quantities, and there may be many ignition sources. The components of

crude oil and condensates may be separated based on volatility. The

more volatile mixtures (or purified substances) resulting from such

processing may meet the criteria for NFPA 4 and, therefore, would need

to be considered for threshold determination in accordance with the

provisions for threshold determination of regulated flammable

substances in mixtures, as discussed in the next section of this

preamble. Similarly, before gasoline is finally formulated into a fuel

for internal combustion engines, during processing in a refinery, it

may meet the criteria for NFPA 4 and, therefore, would need to be

considered for threshold determination in accordance with the

provisions for threshold determination of regulated flammable

substances in mixtures.

EPA requests comments on the proposed exemption from threshold

determination for gasoline used as fuel for internal combustion engines

and specifically requests comments on whether the qualifying phrase,

``used as fuel for internal combustion engines,'' is a necessary part

of the exemption. EPA also requests comments on the proposed exemption

for regulated substances in naturally occurring hydrocarbon mixtures

prior to initial processing and on the proposed definitions related to

the exemption for naturally occurring hydrocarbon mixtures.

C. Clarification of Threshold Determination of Regulated Flammable

Substances in Mixtures

In the final rule, EPA provided flash point and boiling point

criteria for determining whether a mixture containing a regulated

flammable substance is subject to threshold determination. Although

these flash point and boiling point criteria are associated with an

NFPA rating of 4, the NFPA rating was not specifically cited as a

criterion. As discussed in the preamble to the List Rule, EPA believes

that mixtures that do not have an NFPA rating of 4 should not be

subject to threshold determination. Based on comments from the

regulated community, EPA now believes the flash point and boiling point

criteria, although they are part of the criteria for the NFPA 4 rating,

are not adequate by themselves to identify mixtures with the NFPA 4

rating. As noted above, the NFPA 4 rating applies to substances that

will rapidly or completely vaporize at atmospheric pressure and normal

ambient temperature or that are readily dispersed in air, and that will

burn readily. Like gasoline and crude oil, which have NFPA 3 ratings

for flammability, other mixtures may contain low boiling flammable

components that would cause the mixture to meet the flash point and

boiling point criteria, but also contain higher boiling components that

would prevent the mixture from rapidly or completely vaporizing. To

clarify threshold determination for mixtures, EPA is proposing to

provide that, for mixtures that have one percent or greater

concentration of a regulated flammable substance, the entire weight of

the mixture shall be treated as the regulated substance unless the

owner or operator can demonstrate that the mixture does not have an

NFPA flammability hazard rating of 4, as defined in the NFPA Standard

System for the Identification of Fire Hazards of Materials, NFPA 704-

1990. EPA requests comments on this proposed clarification, which would

be in addition to the specific exemption proposed for gasoline and

naturally occurring hydrocarbons.

D. Definition of Stationary Source

The List Rule defined stationary source to exclude transportation,

including storage incident to transportation, provided such

transportation is regulated under 49 CFR parts 192, 193, or 195. In

addressing issues related to EPCRA, which also excludes transportation

in commerce for most purposes, EPA has interpreted the transportation

exclusion to exempt substances being transported in commerce or in

storage under active shipping papers and to treat as a ``stationary

item'' any storage in containers not under active shipping papers. In

the List Rule, EPA referred to DOT pipeline regulations under 49 CFR

parts 192, 193, and 195, and stated in the Preamble that pipelines,

transfer stations, and other activities already covered by DOT would be

excluded. Furthermore, EPA intended to exclude from the definition of

stationary source all transportation and storage incident to such

transportation to be consistent with EPCRA. EPA believes the List Rule

definition of stationary source clearly covers transportation

containers only when they are no longer in transportation in commerce

and clearly excludes pipelines as defined by DOT; however, based on

comments from the regulated community, EPA believes there still may be

potential for overlap and confusion regarding the jurisdiction and

regulatory responsibility of EPA and DOT for pipelines and for

transportation containers at stationary sources.

The Agency has received questions regarding the language in the

stationary source definition that refers to ``transportation containers

no longer under active shipping papers.'' Both EPA and DOT agree this

term would generally apply to containers that are not in transportation

in commerce and that are at the stationary source for purposes of

storage, loading, or unloading that is not incidental to transportation

in commerce. ``Transportation in commerce'' is defined by DOT pursuant

to Federal Hazardous Materials Transportation Law (Federal HAZMAT Law,

49 U.S.C. sections 5107-5127). As a result of continued questions

regarding the scope of Federal HAZMAT Law and the applicability of the

regulations issued thereunder, DOT is currently working to better

delineate and more clearly define the applicability of its regulations.

DOT currently contemplates clarifying its jurisdiction through the

rulemaking process. As a result, there may be a future need for EPA to

further amend the definition of stationary source to better comport

with DOT clarifications or actions. The Agency will continue to work

closely with DOT to minimize overlap and confusion with respect to

jurisdiction and items in transportation and will coordinate with DOT

to ensure that consistent interpretations about regulations coverage

are provided to the regulated community.

EPA is proposing several amendments to the definition of stationary

source to reflect more clearly EPA's intent. First, EPA is proposing to

modify the definition of stationary source to clarify that exempt

transportation shall include, but not be limited to, transportation

activities subject to regulation or oversight under 49 CFR parts 192,

193, or 195, as well as transportation subject to natural gas or

hazardous liquid programs for which a state has in effect a

certification under 49 U.S.C. section 60105. DOT established safety

standards for pipeline facilities used in the transportation of natural

gas by pipeline in 49 CFR part 192, for liquefied natural gas

facilities in 49 CFR part 193, and for pipeline facilities used in the

transportation of hazardous liquids by pipeline in 49 CFR part 195.

State programs with certifications under 49 U.S.C. section 60105 are

comparable to the DOT

[[Page 16602]]

requirements and thus ensure public safety.

In addition, EPA is proposing to modify the definition of

stationary source to clarify that naturally occurring hydrocarbon

reservoirs are not stationary sources or parts of stationary sources.

This interpretation is consistent with EPA's policy under EPCRA. API

concluded in the Hazard Assessment of Exploration and Production

Facilities Potentially Subject to the Environmental Protection Agency's

Risk Management Program Regulations (January 20, 1995) that the flow of

hydrocarbons from reservoirs would not contribute to the magnitude of a

catastrophic release scenario. This conclusion was based on consequence

analysis of a range of fire and explosion events, assuming a range of

handling conditions, types of equipment, and material compositions

typical of exploration and production facilities. Finally, EPA is

clarifying that the exemption for transportation containers in

transportation in commerce or storage incident to such transportation

is not limited to pipelines. EPA requests comments on these proposed

revisions to the stationary source definition.

E. Applicability to Outer Continental Shelf

EPA is proposing an applicability exception for sources on the

outer continental shelf (OCS sources). Such an exception is consistent

with CAA section 328, which precludes the applicability of EPA CAA

rules to such sources when such rules are not related to attaining or

maintaining ambient air quality standards or to the ``prevention of

significant deterioration'' provisions of the CAA.

III. Summary of Proposed Revisions to the Rule

EPA is proposing to amend several sections of part 68 of title 40

of the Code of Federal Regulations.

In Sec. 68.3, the definition of stationary source would be revised.

The revised definition would specifically state that naturally

occurring hydrocarbon reservoirs are not stationary sources or parts of

stationary sources. The definition would state that exempt

transportation shall include, but not be limited to, transportation

activities subject to regulation or oversight under 49 CFR parts 192,

193, or 195, as well as transportation subject to natural gas or

hazardous liquid programs for which a state has in effect a

certification under 49 U.S.C. section 60105.

Several new definitions are proposed for Sec. 68.3, for condensate,

crude oil, field gas, natural gas processing plant, petroleum refining

process unit, and produced water.

Section 68.10 is proposed to be amended to clarify that part 68

does not apply to OCS sources.

Several revisions are proposed for Sec. 68.115 on threshold

determination. Section 68.115(b)(2) is proposed to be modified to state

that the entire weight of the mixture containing a regulated flammable

substance shall be treated as the regulated substance unless the owner

or operator can demonstrate that the mixture does not have an NFPA

flammability hazard rating of 4. Another proposed modification to

Sec. 68.115(b)(2) would exempt from threshold determination regulated

flammable substances in gasoline used as fuel in internal combustion

engines. Regulated substances in naturally occurring hydrocarbon

mixtures (including condensate, crude oil, field gas, and produced

water), prior to entry into a natural gas processing plant or a

petroleum refining process unit, also are proposed to be exempt from

threshold determination. Section 68.115(b)(3), on concentrations of a

regulated explosive substance in a mixture, is proposed to be deleted,

and 68.115(b)(4), 68.115(b)(5), and 68.115(b)(6) would be redesignated

as 68.115(b)(3), 68.115(b)(4), and 68.115(b)(5).

Section 68.130 is proposed to be modified by the deletion of (a),

explosives listed by DOT as Division 1.1. Section 68.130(b) would be

redesignated as 68.130(a), and 68.130(c) would be 68.130(b).

IV. Required Analyses

A. E.O. 12866

Under Executive Order 12866 (58 FR 51735, October 4, 1993), the

Agency must judge whether the regulatory action is ``significant,'' and

therefore subject to OMB review and the requirements of the Executive

Order. The Order defines ``significant regulatory action'' as one that

is likely to result in a rule that may:

(1) Have an annual effect on the economy of $100 million or more or

adversely affect in a material way the economy, a sector of the

economy, productivity, jobs, the environment, public health or safety,

or state, local, or tribal government or communities;

(2) Create a serious inconsistency or otherwise interfere with an

action taken or planned by another agency;

(3) Materially alter the budgetary impact of entitlements, grants,

user fees, or loan programs or the rights and obligations of recipients

thereof; or

(4) Raise novel legal or policy issues arising out of legal

mandates, the President's priorities, or the principles set forth in

the Executive Order.

It has been determined this proposed rule is not a ``significant

regulatory action'' under the terms of Executive Order 12866 and

therefore is not subject to OMB review.

B. Regulatory Flexibility Act

In accordance with the Regulatory Flexibility Act of 1980, Federal

agencies must evaluate the effects of the rule on small entities and

examine alternatives that may reduce these effects.

EPA has examined the proposed rule's potential effects on small

entities as required by the Regulatory Flexibility Act. It has

determined that this rule will have no adverse effect on small entities

because it reduces the number of substances that would be used to

identify stationary sources for regulation and provides exemptions that

will likely reduce the number of stationary sources subject to the

accidental release prevention requirements. Therefore, I certify that

today's proposed rule will not have a significant economic effect on a

substantial number of small entities.

C. Paperwork Reduction Act

This proposed rule does not include any information collection

requirements for OMB to review under the provisions of the Paperwork

Reduction Act of 1980, 44 U.S.C. 3501 et seq.

D. Unfunded Mandates

Under section 202 of the Unfunded Mandates Reform Act of 1995,

signed into law on March 22, 1995, EPA must prepare a statement to

accompany any rule where the estimated costs to State, local, or tribal

governments in the aggregate, or to the private sector, will be $100

million or more in any one year. Under section 205, EPA must select the

most cost-effective and least burdensome alternative that achieves the

objective of the rule and is consistent with statutory requirements.

Section 203 requires EPA to establish a plan for informing and advising

any small governments that may be significantly impacted by the rule.

EPA has estimated that this rule does not include a Federal mandate

that may result in estimated costs of $100 million or more to either

State, local, or tribal governments in the aggregate, or to the private

sector.

List of Subjects in 40 CFR Part 68

Environmental protection, Chemicals, Chemical accident prevention,

Clean Air Act, Extremely hazardous substances, Incorporation by

reference, Intergovernmental relations, Hazardous

[[Page 16603]]

substances, Reporting and Recordkeeping requirements.

Dated: April 5, 1996.

Carol M. Browner,

Administrator.

For the reasons set out in the preamble, Title 40, Chapter I,

Subchapter C, Part 68 of the Code of Federal Regulations is proposed to

be amended as follows:

PART 68--CHEMICAL ACCIDENT PREVENTION PROVISIONS

1. The authority citation for part 68 continues to read as follows:

Authority: 42 U.S.C. sections 7412(r), 7601.

Subpart A--General

2. Section 68.3 is proposed to be amended by adding the following

definitions in alphabetical order and revising the definition of

stationary source to read as follows:

Sec. 68.3 Definitions.

* * * * *

Condensate means hydrocarbon liquid separated from natural gas that

condenses due to changes in temperature, pressure, or both, and remains

liquid at standard conditions.

Crude oil means any naturally occurring, unrefined petroleum

liquid.

* * * * *

Field gas means gas extracted from a production well before the gas

enters a natural gas processing plant.

Natural gas processing plant (gas plant) means any processing site

engaged in the extraction of natural gas liquids from field gas,

fractionation of mixed natural gas liquids to natural gas products, or

both. A separator, dehydration unit, heater treater, sweetening unit,

compressor, or similar equipment shall not be considered a ``processing

site'' unless such equipment is physically located within a natural gas

processing plant (gas plant) site.

Petroleum refining process unit means a process unit used in an

establishment primarily engaged in petroleum refining as defined in the

Standard Industrial Classification code for petroleum refining (2911)

and used for the following: (1) Producing transportation fuels (such as

gasoline, diesel fuels, and jet fuels), heating fuels (such as

kerosene, fuel gas distillate, and fuel oils), or lubricants; (2)

Separating petroleum; or (3) Separating, cracking, reacting, or

reforming intermediate petroleum streams.

Examples of such units include, but are not limited to, petroleum-

based solvent units, alkylation units, catalytic hydrotreating,

catalytic hydrorefining, catalytic hydrocracking, catalytic reforming,

catalytic cracking, crude distillation, lube oil processing, hydrogen

production, isomerization, polymerization, thermal processes, and

blending, sweetening, and treating processes. Petroleum refining

process units include sulfur plants.

* * * * *

Produced water means water extracted from the earth from an oil or

natural gas production well, or that is separated from oil or natural

gas after extraction.

* * * * *

Stationary source means any buildings, structures, equipment,

installations, or substance emitting stationary activities which belong

to the same industrial group, which are located on one or more

contiguous properties, which are under the control of the same person

(or persons under common control), and from which an accidental release

may occur. A stationary source includes transportation containers that

are no longer under active shipping papers and transportation

containers that are connected to equipment at the stationary source for

the purposes of temporary storage, loading, or unloading. A stationary

source does not include naturally occurring hydrocarbon reservoirs. The

term stationary source does not apply to transportation, including

storage incident to transportation, of any regulated substance or any

other extremely hazardous substance under the provisions of this part.

Transportation includes, but is not limited to, transportation subject

to oversight or regulation under 49 CFR parts 192, 193, or 195, or a

state natural gas or hazardous liquid program for which the state has

in effect a certification to DOT under 49 U.S.C. section 60105.

Properties shall not be considered contiguous solely because of a

railroad or gas pipeline right-of-way.

3. Section 68.10, as proposed at 60 FR 13543, is further amended by

adding a paragraph (e) to read as follows:

Sec. 68.10 Applicability.

* * * * *

(e) The provisions of this part shall not apply to an Outer

Continental Shelf (``OCS'') source, as defined in 40 CFR 55.2.

Subpart C--Regulated Substances for Accidental Release Prevention

4. Section 68.115 is proposed to be amended by revising paragraph

(b) introductory text and paragraph (b)(2); removing paragraph (b)(3);

and by redesignating paragraphs (b)(4) as (b)(3), (b)(5) as (b)(4), and

(b)(6) as (b)(5) to read as follows:

Sec. 68.115 Threshold determination.

* * * * *

(b) For the purposes of determining whether more than a threshold

quantity of a regulated substance is present at the stationary source,

the following exemptions apply:

* * * * *

(2) Concentrations of a regulated flammable substance in a mixture.

(i) General provision. If a regulated substance is present in a

mixture and the concentration of the substance is below one percent by

weight of the mixture, the mixture need not be considered when

determining whether more than a threshold quantity of the regulated

substance is present at the stationary source. Except as provided in

paragraph (b)(2) (ii) and (iii) of this section, if the concentration

of the substance is one percent or greater by weight of the mixture,

then, for purposes of determining whether a threshold quantity is

present at the stationary source, the entire weight of the mixture

shall be treated as the regulated substance unless the owner or

operator can demonstrate that the mixture itself does not have a

National Fire Protection Association flammability hazard rating of 4.

The demonstration shall be in accordance with the definition of

flammability hazard rating 4 in the NFPA 704, Standard System for the

Identification of the Fire Hazards of Materials, National Fire

Protection Association, Quincy, MA, 1990. Available from the National

Fire Protection Association, 1 Batterymarch Park, Quincy, MA 02269-

9101. This incorporation by reference was approved by the Director of

the Federal Register in accordance with 5 U.S.C. 552(a) and 1 CFR part

51. Copies may be inspected at the Environmental Protection Agency Air

Docket (6102), Attn: Docket No. A-96-08, Waterside Mall, 401 M. St.

SW., Washington D.C.; or at the Office of Federal Register at 800 North

Capitol St., NW, Suite 700, Washington, D.C. (Note: this document will

only be available for inspection at the Federal Register after this

action becomes a final rule.) Boiling point and flash point shall be

defined and determined in accordance with NFPA 321, Standard on the

Basic Classification of Flammable and Combustible Liquids, National

Fire Protection Association, Quincy, MA, 1991. Available from the

National Fire Protection Association, 1 Batterymarch Park, Quincy, MA

02269-9101. This

[[Page 16604]]

incorporation by reference was approved by the Director of the Federal

Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. Copies

may be inspected at the Environmental Protection Agency Air Docket

(6102), Attn: Docket No. A-96-08, Waterside Mall, 401 M. St. SW.,

Washington D.C.; or at the Office of Federal Register at 800 North

Capitol St., NW, Suite 700, Washington, D.C. (Note: this document will

only be available for inspection at the Federal Register after this

action becomes a final rule.) The owner or operator shall document the

National Fire Protection Association flammability hazard rating.

(ii) Gasoline. Regulated substances in gasoline, when in

distribution or related storage for use as fuel for internal combustion

engines, need not be considered when determining whether more than a

threshold quantity is present at a stationary source.

(iii) Naturally occurring hydrocarbon mixtures. Prior to entry into

a natural gas processing plant or a petroleum refining process unit,

regulated substances in naturally occurring hydrocarbon mixtures need

not be considered when determining whether more than a threshold

quantity is present at a stationary source. Naturally occurring

hydrocarbon mixtures include any combination of the following:

condensate, crude oil, field gas, and produced water, each as defined

in Sec. 68.3 of this part.

* * * * *

Sec. 68.130 [Amended]

5. Section 68.130 is proposed to be amended by removing paragraph

(a) and redesignating paragraph (b) as (a), and paragraph (c) as (b).

The tables to the section remain unchanged.

[FR Doc. 96-9095 Filed 4-12-96; 8:45 am]

BILLING CODE 6560-50-P