1. EPA Public Meeting Dallas, Texas May 10, 2005
Storm Water Discharges from Oil and Gas Related Construction Activities
EPA
Public Meeting
Dallas, Texas
May 10, 2005

2. Overview History Rule deferral rationale Regulatory options
EPA analysis
Q&A

3. Chronology 1987 Water Quality Act
- 2 phase program to control storm water
- Oil and gas storm water exempt
1990
Storm Water Phase I
1999
Storm Water Phase II
March 10, 2003
Deferral Rule
March 9, 2005
September, 2005
Notice of Proposed Rule Making
June 12, 2006
Final Action Required

4. Oil and Gas Exemption
CWA §402(l)(2) - The Administrator shall not require a permit … for discharges of stormwater runoff from … oil and gas exploration, production, processing, or treatment operations or transmission facilities, composed entirely of flows which are from conveyances or systems of conveyances … used for collecting and conveying precipitation runoff and which are not contaminated …
Construction activity, includes clearing, grading, and excavating
Since 1992, EPA has considered construction activity at oil and gas sites to require permit coverage – i.e., not considered to fall under exemption.

5. EPA as NPDES Permitting Authority
Construction
and Industrial
Federal Facilities
Oil and Gas
Puerto Rico
Virgin Islands
Tribes
Other Territories

6. 2003 Facts and Figures ~28,000 new well sites in 29 states
EPA administers the Storm Water program in AK*, TX, OK, and NM:
48% of the wells are drilled
66% of estimated compliance costs are accrued
Permit addresses ESA and NHPA
* Vast majority of AK sites are >5 acres and covered by Phase I regulations.

7. Deferral Rationale
Phase II Rule determined that few if any oil and gas sites exist between 1 and 5 acres
EPA subsequently deferred requirement for small oil and gas sites to obtain permit coverage
EPA performing:
Economic impact analysis, including cost/benefit analysis
BMP review
Industry Standard Operating Procedures
BLM Gold Book Guidelines
State prescribed BMPs
Analysis of regulatory options

8. Regulatory Options
EPA is currently evaluating 2 options (against the baseline) for regulating small oil and gas construction activity:
(Baseline) - Regulate consistent with Phase II Rule
(Option 1) – Create New Waiver
(Option 2) - Non-permitting program [CWA 402(p)(6)]

9. Regulatory Options (Baseline)
Baseline Approach:
Requirements include:
Coverage under Construction General Permit
Develop site-specific Storm Water Pollution Prevention Plan (SWPPP)
Perform routine inspections
ESA/NHPA considerations (for EPA permits)

10. Baseline Approach
GAO , February 2005

11. Baseline – Construction SWPPP
Site Description
Controls to Reduce Pollutants
Erosion and Sediment Controls
Stabilization Practices
Storm Water Management
Maintenance
Inspections

12. Baseline- SWPPP: Site Description
Description of construction activity
Sequence of major soil disturbing events
Total and disturbed area (acreage)
Storm water discharges (location)
Site map
Storm water controls (location)
Receiving waters (name, location)
Endangered species; historic preservation

13. Baseline- SWPPP: Erosion and Sediment Controls
Properly select and install controls to:
Minimize erosion
Retain sediment on-site
Remove any sediment that accumulated off-site
Remove sediment from sediment traps
Prevent litter from entering streams

14. Baseline- SWPPP: Stabilization Practices
Temporary Seeding
Permanent Seeding
Mulching
Sod Stabilization
Vegetative Buffer Strips
Tree Preservation
Contouring and Protecting Sensitive Areas

15. Baseline- SWPPP: Structural Controls
Earth Dike
Subsurface Drain
Silt Fence
Pipe Slope Drain
Drainage Swales
Temporary Storm Drain Diversion
Sediment Traps
Storm Drain Inlet Protection
Check Dams
Rock Outlet Protection
Level Spreader

16. Maintenance and Inspections
BMPs must be maintained in effective operating condition
Any repairs must be performed before next anticipated storm event, if possible.
Inspect at least every 14 calendar days and within 24 hours after any storm event of 0.5 inches or greater (or every 7 days) until permit coverage terminated.

17. Regulatory Option #1- Waiver
Sites <5 acres would be waived from permit coverage under certain conditions
Sites 5 acres and above would still be required to obtain permit coverage
Possible waiver eligibility requirements:
Short term (<30 days) construction
Proximity to water body
Slope, region, and other site-specific considerations
BMP implementation

18. Regulatory Option #2- Non-Permitting NPDES Program
Comprehensive program under CWA section 402(p)(6)
Develop a program for O&G construction activity
Likely similar BMP requirements as baseline and Option 1
Evaluate legal authorities and responsibilities
More information to be added when provided by EPA.

19. Economic Analysis: Purpose
Evaluate the costs and benefits of the requirements under the Phase II Storm Water Rule
Follow analytical approach using relevant data from the Phase II analysis (1998).
Examine the costs and benefits for 3 rulemaking options:
Baseline (expiration of deferral after 6/12/06)
Waiver
Non-permitting program under CWA 402(p)(6)

20. Economic Analysis: Impacts
Direct costs
Notice of Intent
SWPPPs
BMPs
Potential ESA & NHPA Considerations
Indirect costs
Revenue delay
Forgone lease bonus payments
Idle rig contract payments
Project cancellation

21. Next Steps Questions? Gather additional information
Complete Economic Analysis
Notice of Proposed Rulemaking (9/05)
Comment period
Final Rulemaking (6/06)
We also added a slides for next steps if you wish to use it.
Questions?