Texas Natural Resource Conservation Commission 
                         INTEROFFICE MEMORANDUM


To:  Duncan Stewart, Chemical Section, New Source Review
Date:  January 21, 1997
Through:  David Duncan, Senior Attorney, Air Section, 
            Legal Division
From:  Laura L. Rowan, Staff Attorney, Air Section, Legal Division
Subject:  Use of Standard Exemptions for Facilities Operating under
Standard Permits
                                
                             ISSUE

Whether standard exemptions can be used to authorize emissions from
an oil and gas facility operating under a standard permit in order
to account for sulfur dioxide emissions above the level allowed by
the standard permit.
                                
                             FACTS
                                
Company A has a standard permit for an oil and gas facility it
operates in accordance with the standard permit requirements for
oil and gas facilities in 30 TAC 116.620.  Those requirements limit
sulfur dioxide emissions to a maximum of 250 tons per year (tpy).
30 TAC 116.620(a)(1).  As oil fields age, the sulfur concentration
in given throughput levels at oil and gas facilities processing
product from the fields increases.  Given the aging of the field in
use for Company A's oil and gas facility, continued operation of
the facility with the increasing sulfur concentrations would result
in the exceedance of the 250 tpy sulfur dioxide emissions limit.
Company A has asked whether it can continue to operate under the
standard permit by using Standard Exemption 66 (oil or gas production
facility) and Standard Exemption 80 (smokeless gas flares) to
account for sulfur emissions in excess of the amount allowed by the
standard permit. 
                                
                          SHORT ANSWER
                                
Company A may not use standard exemptions to obtain authorization
to increase sulfur emissions above the level allowed by its
standard permit. 
                                
                           DISCUSSION
                                
The Texas Clean Air Act states that the commission may issue "a
standard permit developed by rule for numerous similar facilities.
. . ."  TEX. HEALTH & SAFETY CODE ANN. 382.051(b)(3) (Vernon 1997). 
Subchapter F of 30 TAC Chapter 116 contains the TNRCC's rules for
standard permits.  In that subchapter, Section 116.610(a) states
that "projects involving the types of facilities or physical or
operational changes to facilities which meet the requirements for
a standard permit listed in this subchapter are hereby entitled to
a standard permit; . . ."  Among the limited and clearly-defined
types of facilities entitled to standard permits are the types of
oil and gas facilities described in 116.620.  If the sulfur
emissions from Company A's facility exceed the levels allowed by
that rule, the facility would no longer be a "similar facility" or
the "type of facility" entitled to a standard permit.  

The general conditions for standard permits contained in 30 TAC
116.615 indicate that certain changes to a standard permitted
facility will render the facility no longer eligible to operate
under the standard permit.  Regarding standard permit
representations, 116.615(2) states:

     All representations with regard to construction plans,
operating procedures, and maximum emission rates in any
registration for a standard permit become conditions upon which the
facility or changes thereto, shall be constructed and operated.  It
shall be unlawful for any person to vary from such representations
if the change will affect that person's right to claim a standard
permit under this section.  Any change in condition such that a
person is no longer eligible to claim a standard permit under this
section requires proper authorization under 116.110 of this title
(relating to Applicability).  If the facility remains eligible to
claim a standard permit, the owner or operator of the facility must
notify the TNRCC of any changes in conditions which will result in
a change in the method of control of emissions, a change in the
character of emissions, or an increase in the discharge of the
various emissions as compared to the representations in the
original registration or any previous notification of a change in
representations. . . (emphasis added).
     
     The above rule indicates that a change in conditions can
render a person no longer eligible to claim a standard permit.  If
a facility is no longer eligible to claim a standard permit, the
owner or operator must obtain a different type of authorization
under 116.110.  The rules neither state nor suggest that a facility
can continue operating under a standard permit by incorporating
changes that violate the terms of the standard permit by the use of
a standard exemption.  Accordingly, if a person who plans to
construct an oil and gas facility knows that sulfur concentrations
from the operation of the facility will eventually exceed the
standard permit sulfur emissions limitation, that person must
obtain a permit pursuant to 30 TAC 116.111 rather than a standard
permit.