Professional Documents
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Hearing Officer's Report
Hearing Officer's Report
On February 12, 2018, the appointed Hearing Officer conducted a public hearing pursuant
to 20.1.4.100 (E) (2) NMAC at the Marquez Plaza Building, 525 Camino de Los Marquez, Santa
Fe, New Mexico. Andrew Knight, Office of General Counsel, appeared on behalf of the Air
Quality Bureau of the New Mexico Environment Department (“Department”). Louis Rose,
Montgomery & Andrews, appeared for COG Operating LLC (“COG”), Jennifer Bradfute and
Christina Sheehan, Modrall, Sperling, Roehi, Harris & Sisk, PA, appeared on behalf of New
NMED, the applicant, seeks approval for the General Construction Permit for Oil and Gas
Facilities (“AQB 17-26 P”). Applicant presented the technical testimony of Elizabeth Bisbey
Kuehn, then Manager of the Minor Source Section of the Air Quality Control Bureau (Currently
Bureau Chief) and Eric Peters, an Air Dispersion Modeler with the Air Quality Bureau in support
NMOGA. GOG presented no technical testimony but asked clarifying questions regarding the
public hearing. Several members of the public attended the hearing. Some members spoke on
behalf of coalitions and groups of concerned citizens. Some members spoke on behalf of non
profit organizations. Members of the public cross examined the technical witnesses. A
considerable number of public comments were also submitted via email. The Hearing Officer
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asked clarifying questions, admitted all exhibits offered by the parties (Department’s Exhibits 1-
10, and a Supplement of Exhibit 9 which included additional public comment and NMOGA’s
Exhibit 1, B I, and B2) into the record proper, and closed the evidentiary record after the public
hearing. Members of the public also filed exhibits at the hearing which were not pre- marked but
included in the record. The record proper also contains the administrative record and all documents
filed with the Hearing Clerk, including emails and letters addressing the public comment.
The public hearing lasted one day and the Hearing Officer conducted it in accordance with
the Department’s Permit Procedures found in 20.1.4 NMAC. The parties submitted proposed
findings of fact and conclusions of law, which the Hearing Officer considered and adopted in
This is not a verbatim account of the sworn testimony but rather a synopsis
Citations to the transcript are in the following format (TP page #).
1. Ms. Loyd testified on behalf of herself and her husband Jeremy Sment. She testified that
there is a Delaware-sized methane plume above the Four Corners. She also testified about
the loss of millions of dollars of revenue due to waste caused by flaring as it escapes into
2. Mr. Schmidt testified in his capacity as an emissions testing manager. His experience
working to support compliance needs of his customers. (TP 16). He submitted a letter
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mentioned neighboring states like Colorado which have adopted this method to show
compliance. (TP 17). Upon questioning by the Hearing Officer, he stated he had both a
his opinion it was superior to other methodologies. He was concerned that if the draft
penTlit did not explicitly mention it, it would not be considered an approved method. (TP
18, 20).
3. Mr. Goldstein, Director of regulatory and legislative affairs for the Environmental Defense
Fund commented on the draft Pennit for Oil and Gas facilities. (TP 21). Environmental
Defense Fund is a national membership organization with over 2 million national members.
(TP 21). Its local membership includes more than 18,000 New Mexicans. (TP 22). One
major concern was that the draft permit did not address emission limitation or perfonnance
standards beyond the Federal standards. (TP 22). Mr. Goldstein discussed the findings for
a NASA satellite study showing the largest concentration of methane anywhere in the U.S.
above the Four Corners. He analogized that the 570,000 tons of methane were the
equivalent of 12 coal fired power plants. (TP 23). He urged New Mexico to keep pace
with its neighbors, that are also major oil and gas producing states, adopting requirements
that are more stringent than federal or apply to sources not regulated by EPA. (TP 23). He
went on to list three other states: Colorado, Wyoming, and Utah that include regulations
that are more protective than Federal Standards. (TP 24). Ohio, Pennsylvania, and
California also have standards more protective than federal standards. (TP 25). Special
emphasis was placed on the timeliness of the permit change in the shifting regulatory
landscape of EPA and Bureau of Land Management. (TP 26). Overall, the attempt to
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streamline the pennit process is missing an opportunity to adopt more rigorous standards
as neighboring states have demonstrated. (TP 27). One concern that was communicated
to NMED were the lack of controls on methane, with nothing beyond federal standards in
regard to Volatile Organic Compounds, and hazardous air pollutant requirements. (TP 28).
4. Ms. Wells testified that she resided in Santa Fe and was a member of United Church of
Christ and New Mexico Interfaith Power and Light. (TP 30). She seconded the statements
made by Mr. Goldstein and mentioned concern about methane leaks and how it could affect
5. Ms. Brown testified as a Franciscan Sister and Executive Director of New Mexico
Interfaith Power and Light. (TP 31). She mentioned that faith based communities have
been involved in addressing methane pollution to create stronger guidelines on the federal
and state level. (TP 31). She stated that letters that are signed by faith based leaders
statewide are voices that are not nonnally heard. (TP 31). This concern is prompted by a
concern for environmental justice, the health of the communities, and for care of all God’s
creation. (TP 31, 32). She disapproved of allowing each operator to estimate their expected
emissions and allowing the operators to determine which control devices to install. (TP
32). Another element of the draft permit that was troubling was the removal of one-quarter
mile setbacks for polluting facilities, from homes, schools, offices, and state parks. (TP
32). Because of New Mexico’s poverty, the loss of $27 million dollars a year affects the
royalties that would benefit the state and are wasted. tip 33). Her mother and her religious
traditions indicate “Waste Not, Want Not” and those guidelines are not being followed.
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(TP 33). When questioned about enviromnental justice impacts by the Hearing Officer,
Sister Brown indicated that in the Northwest there were groups of indigenous people and
in the Southeast where 50 or 60 percent of the population was Hispanic, that those voices
were marginalized and diminished because they don’t have power. (TP 35). The power is
held by industry and money. (TP 35). She expressed a concern that language access was
6. Mr. Meaders recommended that the state institute well head metering. He wanted
the state and the states children to obtain the royalties. (TP 36). He thought that anything
that was flared or wasted should be paid for because it is a state resource. He noted that
7. Ms. Joseph, a nurse, testified about the public health consequences especially as it
problems. (TP 39. ) The financial cost of lost revenue of $27 million due to venting,
flaring, and leaks was also a concern. (TP 39). She feels strongly that New Mexico
has a duty to all its citizens to protect public health. (TP 40).
8. Mr. Singer represented the Western Environmental Law Center. (TP 42). They are
based in Taos and represent clients in the four Corners Region. (TP 42). He previously
served on an advisory committee. (TP 42). He was also heavily involved in the
methane rule making by the Bureau of Land Management. (TP 42). He pointed out
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that the methane rules, stern from EPA rules, New Source Performance Standards
Sections Quad 0 (0000) and Quad Oa (0000a). (TP 42). He mentioned that those
9. Ms. Layne wanted the people who supported fracking to identify themselves at the
hearing. (TP 45). She stated that the drafi permit would not establish maximum
emissions and that in her opinion that was just wrong. (TP 45). The new proposed rule
would delete the requirement for setbacks from schools and homes. (TP 46). She also
read from the Rio Grande Chapter of the Sierra Club which quoted 180 to 240 million
dollars of New Mexico’s natural gas is being wasted due to largely preventable venting,
flaring, and leaks according to scientific estimates and industry’s self-reported data.
(TP 47).
10. Ms. Griffin testified as a concerned citizen and concerned parent. (TP 49). She urged
New Mexico to be a trend setter by making things better, as health and wellbeing, are
things that matter, and affect fundamental rights: including life, liberty, and the pursuit
11. Ms. Seamster, an elected office of the Northern New Mexico Sierra Club, had several
questions for the Department’s witnesses. (TP 112). She wanted to know how the
WPX explosion occurred and the environmental consequences. (TP 117). She was
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particularly concerned about hydrogen sulfide being leaked within a quarter mile of the
12. Mr. Baizel, is the Director of the Oil and Gas Accountability Project, and the energy
program of Earthworks. (TP 129). He wanted to know why the setback rule was
eliminated from the current drafi permit. (TP 131). The NMED witness, Elizabeth
Bisbey-Kuehn, testified that the setback requirement had been eliminated because they
did not have the regulatory authority to include it. (TP 131). Previous Permits did not
have the regulatory authority to include it. (TP 131). Mr. Baizel suggested that
coordinated notice might be helpful to alert surface owners of any changes to the permit
in the event of a modification which would not require additional public notice. (TP
135).
13. Mr. Verchinski wondered why there was no listing of best available technology in the
permit process. (TP 145) The NMED witness, Elizabeth Bisbey-Kuehn, stated that
they didn’t have the regulatory authority to insist on best available emission equipment
14. Mr. Schmidt learned through cross examination that ASDM D 30 had been added to a
list of approved technologies during the course of the hearing. (TP 152).
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15. Mr. Goldstein questioned Mr. Peters who did the modeling about impacts at the fence
line. The Witness explained that most likely there would be. (TP 167).
Mr. Peters was questioned about the cumulative effects of all the permits. (TP 169). Mr.
Peters stated that if you add the monitoring and modeling together then that would be a full
16. Mr. Baizel asked for Mr. Peters to specify what he included in his modeling. (TP 174).
Mr. Peters, NMED’s modeler, explained he used tanks, turbines, engines, enclosed
Opening Statement and Direct Testimony of New Mexico Oil and Gas
17. Ms. Bradfute explained that the New Mexico Oil and Gas Association, (“NMOGA”)
is a nonprofit industry organization with over 900 members. (TP 182). NMOGA’s
members will be most impacted by the permit. (TP 182). NMOGA responded to public
outreach efforts and submitted numerous comments and suggestions for the proposed
permit (TP 182). She summarized a regulatory outline and explained that the Air
Quality Bureau’s discretion was limited by the regulations. (TP 183). She pointed out
that the EIB, was the appropriate entity, with authority to adopt new standards as
18. Patrick Padilla, Deputy Director of NMOGA, handles matters related to regulatory
proceedings as well as agency interactions on behalf of the association. (TP 185). Mr.
Padilla was tendered as a technical expert in regulatory issues and oil and gas
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operations. (TP 187). Mr. Padilla learned of the proposed General Construction Permit
in late 2015. (TP 188). In response to New Mexico Environment Departments request
for stakeholder input, NMOGA, put together a workgroup of member companies and
2016, TP 188). In January of 201$ NMED hosted an open house to discuss the draft
rate in conjunction with a calculation that would basically prove compliance through
the amount of product moving through a facility, including a provision for starting
authorization of existing facilities that were covered under GCP- 1, and GCP-4, and
Permit by rule was rejected, the facility production rate in conjunction with a
calculation for emissions compliance proof was accepted. (TP 193). Mr. Padilla
explained that oil and gas operators could chose to do business in Texas rather than
New Mexico. (TP 195). Working on the New Mexico Checkerboard comprised of
state land, federal land, tribal land, private land and a whole multitude of land types is
Mr. Padilla explained why he believed that Methane was not specifically listed,
because it was not defined as a criteria pollutant. (TP 198). He explained that you
could not control Volatile Organic Compounds without controlling methane at the same
time. tip 198). He explained that controls on VOC’s emissions complied with
requirements contained in the Clean Air Act. (TP 199). The state would have an
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estimate of non-fugitive emissions through at the Energy, Minerals, and Natural
Resources Department that had a study. (TP 201). Venting and flaring would likely
be higher than any fugitive emissions from equipment. He explained that several peer-
reviewed study’s that 1.7 would be a total loss factor. (TP 101.)
Perfonnance Standards Sections Quad 0 (0000), and Quad Oa (0000a), and the BLM’s
venting and flaring rule. (TP 203). Anything after May of 2012 would have to comply
with Quad 0 (0000) which was aimed at VOC’s. Anything after September 2015, has
There have been attempts at the Federal level to limit those rules. (TP 203). The Hearing
Officer asked if any research was done statewide on the tracking fugitive versus non-
fugitive emissions. (TP 20$, 209). Mr. Padilla indicated that members of NMOGA had
done that research and were relying on data from the Energy Information Agency and EPA.
(TP 209). He stated that NMOGA did not agree with the $27 million-dollar annual loss of
revenue that had been stated earlier due to the fluctuations in the market. (TP 209). He
emphasized that industry is working hard to minimize loss and he extrapolated that if there
were a $27 million-dollar annual loss than industries gross loss would be between $225
million and $230 million. (TP 210). The Hearing Officer questioned the witness about his
opinion about setbacks. (TP 214). Mr. Padilla explained that there are local zoning rules,
and rules at the county and city level. (TP 214). He mentioned communities in the
Southeast and Northwest who have implemented local zoning ordinances. (TP 214).
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19. Mr. Goldstein confirmed that he and Mr. Padilla were talking about the same study, a
2017 Environmental Defense fund study, commonly refelTed to as the New Mexico
Methane Waste Report. (TP 221). Mr. Goldstein questioned whether Mr. Padilla was
familiar with a study “Airborne methane remote measurement reflect heavy tail
distribution in Four Corners Region” that appeared in the proceedings of the National
Academy of Science. (TP 225). Mr. Padilla asked clarifying questions, and stated he
was familiar with the NASA study but didn’t agree it was accurate. (TP 225). Mr.
Padilla confinned that the NASA study was a peer reviewed study. (TP 226).
20. Mr. Baizel testified that he was part of a working group called, STRONGER, which is
a national multi stakeholder board, which reviews Oil and Gas Environmental
representatives on the board. (TP 242). He commented that the absence of optical gas
imaging and LDAR in the permit would not address the problem. (TP 244). He
mentioned Colorado’s methane rule, which was revised, resulted in a 60% reduction in
fugitive emissions. (TP 244). Visual/Olfactory inspection don’t capture it and if you
can see it you can fix it. (244). He also stated that it was better to verify emissions
than for industry to self-report. (TP 244). He observed that in other states, processing
facilities, initially obtained their permits based on modeling emissions standards but
when they were sampled using infrared technology, they were 10 times above the limit.
(TP 245). He observed a trend in other states like Pennsylvania and Texas were facility
modifications were used to avoid obtaining a Title V permit. (TP 245). Mr. Baizel
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thought that a second notice, (posted), that would cover major modifications would be
useful so neighbors and landowners would know of changes to the facilities. (TP 247).
21. Mr. Goldstein reported that he received an email notification during the hearing that
the Bureau of Land Management had issued a policy to rescind its venting and flaring
I. FINDINGS OF FACT
1. The Bureau provided notice of its intent to propose a new General Construction
Penriit for Oil and Gas activities in the fall’ of 2015 and accepted comments and suggestions from
interested stakeholders and the general public between the fall of 2015 — January of 2018.
2. The Secretary issued a Hearing Determination for this matter on December 22,
2017, and the matter was docketed and a hearing officer was assigned on December 27, 2017. See
3. Public notices providing the time, date, and location of the hearing were published
in English and in Spanish in the Albuquerque Journal, FanTlington Daily Times, and the Hobbs
January 29, 2018, listing two witnesses, Elizabeth Bisbey-Kuehn and Eric Peters. Bureau’s
Statement of Intent.
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5. Attorney Louis W. Rose entered his appearance on behalf of COG Operating LLC
Provide Technical Testimony on behalf of the New Mexico Oil and Gas Association (NMOGA)
on February 29, 2018, listing one witness, Patrick Padilla. NMOGA Statement of Intent.
7. A hearing was held on this matter on Monday, February 12, 2018, at the Marquez
Plaza Building, 525 Carnino de Los Marquez, Santa Fe, New Mexico, beginning at 9:00 a.m., and
8. The hearing officer began the hearing by taking public comment from ten members
of the public. Three additional public comments were heard at the end of the hearing. Tr. pp. 15-
9. After being duly sworn, the Bureau’s witnesses adopted their pre-filed written
testimony and provided a summary of the same. Tr. pp. 56-70, and pp. 153-178.
10. Following their direct testimony, the Bureau’s witnesses responded to questions
from the hearing officer, the attorneys for the other parties, and members of the public. Tr. pp. 70-
testimony on behalf of NMOGA, and responded to questions from the hearing officer and one
12. General Construction Permits are authorized by Section 20.2.72.220 NMAC, and
are issued by the Department in order to register like kind types of sources which are subject to
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similar state and federal regulations, which have similar types of equipment and emissions and
which are subject to similar types of monitoring, recordkeeping, and reporting requirements. Tr.
13. The proposed General Construction Permit is more stringent than a source-specific
Part 72 construction permit would be, and the conditions of the General Construction Permit would
14. The proposed permit achieves several important environmental and permitting
benefits, including providing additional flexibility in the type of authorized equipment and control
devices, and improving the Department’s ability to determine compliance with the allowable
15. The proposed permit is intended to supersede the GCP-1 and GCP-4 permits which
were issued 19 and 17 years ago, respectively, and contain outdated equipment lists, outdated
authorized allowable control devices, and outdated monitoring, recordkeeping, and reporting
16. The proposed permit eliminates the existing limitations of the GCP-l and GCP-4
permits, and includes voluntary reductions in the emission of volatile organic compounds from
(PSD) permitting requirements could use the proposed permit to establish federally enforceable
emission limits to stay out of further penrlitting requirements. Tr. p. 57, ln. 14-17.
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18. The proposed pennit is cost-effective, with a current permitting fee of $4,080, and
can be obtained within 30 days of the date the Bureau receives a Registration fonm Tr. p. 57, in.
18-21.
19. General permits provide a permitting option that requires less review time for
permit writers, and less time reviewing modeling results, because the air dispersion modeling
analysis has already been performed during the development of the permit. Tr. p. 58, In. 10-14.
20. The Bureau has issued other General Construction Peniiits, including GCP-l, GCP
-2, GCP-3, GCP-4, GCP-5, and GCP-6. Tr. p. 58, ln. 20-25; p. 59, in. 1-5.
21. The proposed penrLit was developed through a collaborative effort among various
sections within the Bureau, including the Minor Source section, Enforcement and Compliance and
modeling section, together with input and technical assistance from interested parties and
22. The proposed pennit limits the potential emission rate of the pennitted equipment
to less than 95 tons per year of nitrogen oxides, carbon monoxide, and sulfur dioxide. Tr. p. 62, in.
19-2 1.
23. The proposed permit limits the emission rate of all equipment to less than 25 tons
per year of particulate matter measuring 2.5 microns or less, particulate matter measuring between
2.5 and 10 microns, total suspended particulate matter, and hydrogen sulfide. Tr. p. 63, in. 1-4.
24. The proposed permit limits hazardous air pollutants from a facility to less than ten
tons per year for any single hazardous air pollutant and 25 tons per year for all combined hazardous
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25. The proposed pennit contains an allowable equipment list that includes storage
vessels, flares, enclosed combustion devices, thermal oxidizers, engines, turbines, generators,
dehydrators, cryogenic units, acid gas removal systems, amine or sweetening units, and other
26. The proposed permit also authorizes auxiliary equipment and activities, including
heaters, separators, truck loading, vapor recovery towers, condensers, pumps, and compressors.
27. Registration under the proposed permit insures that a facility will not be classified
as a major source pursuant to 20.2.70 or 20.2.74 NMAC. Tr. p. 65, in. 9-1 1.
28. The proposed permit contains monitoring, record keeping, and reporting
requirements for individual pieces of equipment, as well as gas analysis requirements and setback
29. The registration information required for the proposed permit includes all of the
same information required for an individual Part 72 permit. Tr. p. 68, ln. 19-22.
30. The state of New Mexico has no specific regulation that establishes methane
emission limits; rather, New Mexico incorporates federal requirements for methane emissions
found in the New Source Performance Standards Sections 0000 (Quad 0) and Quad Oa. Tr. p.
31. The Bureau would be unable to establish emission limits for methane absent a
specific state regulation promulgated by the Environmental Improvement Board. Tr. 72, In. 24-5;
p.76, ln. 1.
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32. While not specifically controlled or identified in the proposed permit, methane is
part of the constituent stream that is controlled by the various control devices that are authorized
33. Air dispersion modeling performed for the proposed permit was performed using
observed meteorological conditions that would result in the highest concentrations of pollutants at
34. In response to comments from the U.S. EPA and from the oil and gas industry,
many air dispersion models were revised and rerun to develop the proposed penhlit. Tr. p. 156, In.
22-24.
35. In total, hundreds of modeling scenarios were run for the proposed permit. Tr. p.
36. The air dispersion modeling perfornied for the proposed pennit demonstrated that
facilities that operate in accordance with the permit will not cause or contribute to exceedances of
any applicable air quality standard or PSD increment. Tr. p. 157, In. 13-16.
37. In response to comments and questions from other parties during the hearing, the
Bureau agreed to make certain corrections and clarifications to the language of the proposed
penhlit. Tr. p. 102, In. 25; p. 103, in. 1-5; p. 10$, In. 13-24.
38. In addition, the Bureau has identified typographical and clerical errors in the draft
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39. Condition Al00.E has been deleted. This condition states that no construction of
modifications may commence prior to receiving written approval from the Department. As this
condition is duplicated elsewhere in the permit (Condition A102.B; Condition B101.B, and
Condition C 10 1.3.2), Condition Al00.E does not provide additional clarification or instruction,
40. Condition A102.A had an extra and unnecessary period at the end of the regulatory
41. Condition A102.B has been moved to Section A100 and renamed A100.E. This
condition is more appropriate under Section A100: Introduction and Applicability, than under
42. The footnote to Table 106 has been modified to add the tenTi “typically.” In most
cases, fugitives do not count toward Title V and PSD applicability. Adding the term “typically”
provides for the unusual circumstances where fugitive emissions must be included in Title V and
PSD applicability.
43. Condition A106.C has been modified. Under the recordkeeping requirement, the
final sentence has been modified to delete the word “Condition.” The inclusion of this extra word
44. Condition A201.A has been modified. The term “Combustor” has been modified
to “Combustion.” This is consistent with how the equipment is referred in the proposed permit.
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45. Condition A202.B header has been modified. The header has been modified to
state, “of NOx and CO,” instead of “for NOx and CO.” Replacing “for” with “of’ clarifies the
46. Condition A206.B has been modified. The term “with” has been added to the final
sentence of the Requirement Condition. This addition makes the sentence logical and complete.
47. Condition A206.C has been modified. The semicolons separating specific
requirements in the Requirement Condition have been replaced with commas. This is consistent
with other parts of the permit, and provides consistency in the Permit.
48. Condition A207.B has been modified. The letter “a” has been added to the first
sentence of the Monitoring Requirement. This addition makes the sentence logical and complete.
49. Condition A207.C has been modified. The words “or less” have been added after
H2S in the final sentence of the Condition. This request was made by one of the parties at the
50. Condition A208.A has been modified. The words “(two) and (one)” have had the
parentheses deleted and placed around the numbers 2 and 1, respectively. This is consistent with
other parts of permit, and provides consistency to how numbers are represented in the Permit.
51. Condition A208.B has been modified. The Requirement Condition has been
modified to clarify that each ECD and TO in the Registration Fonn is subject to the terms and
conditions of the permit. The term “or” implied that the permittee may comply with the
requirements for either of the units. The new language clarifies that each unit is subject to the
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52. Condition A210.A has been modified. The term “and” has been added between
requirements in the Monitoring Requirements. This is consistent with other parts of permit, and
53. Condition A210.B has been modified. The words “from those listed” has been
deleted from the first sentence of the Requirement Condition. This is consistent with other parts
54. Condition A2 11 .B has been modified. The condition has been updated to include
references to Subpart A, in addition to NSPS 0000 and 0000a. This is consistent with other
parts of penrlit, does not change the meaning of the condition, and provides consistency in the
Permit.
55. Condition A212 has been modified. The setback for Terrain has been updated to
remove the parentheses around “five” and place them around “5.” This is consistent with other
parts of the penilit, and provides consistency in the Pennit. The setback for Nearby facilities has
56. Condition BlOl.D has been modified. The term “regular” has been inserted in
front of “Part 72” each time this term appears in this condition. This clarifies and distinguishes
the difference between regular, or custom, Part 72 penTlits and General Construction pemlits. The
term “application” has been inserted in the first sentence of the third paragraph to clarify that the
57. Condition B1O1.E has been created. The issue of the Department revising the
Registration Form was raised at the hearing. This Condition addresses that concern and states the
following:
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A. On an as needed basis, the Department may revise the
58. Condition B110.f(1) has been modified. The term “limits” has been removed. The
correction clarifies that emissions in excess of 1.0 pph or 1.0 tpy must be reported for units with
59. Condition C100.B(2)(a) has been modified. The parentheses around “ten” have
been removed and inserted around the number “10.” This is consistent with other parts of the
permit.
60. Condition DiOl has been modified to delete multiple definitions of the same tenri,
and clarify the Pennit. The inclusion of multiple definitions of the same term was creating
additional confusion for internal and external users. The deleted definitions may be found in
various state and federal regulations if needed. These definitions are already incorporated into the
penTlit by reference and, thus, the deletion of definitions does not reduce the enforceability of this
61. All the corrections and changes to the proposed permit are shown in redline
strikethrough format in Attachment 1 to this document, and the final proposed permit is included
as Attachment 2.
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62. The hearing was conducted in accordance with the Department’s pennitting
procedures found at 20.1.4 NMAC, and all persons present were given an adequate opportunity to
63. All public notice requirements of 20.2.72 and 20.1.4 NMAC were met for this
hearing.
64. The Department has the authority to issue general construction penhlits such as the
65. Issuance of the proposed pennit falls within the authority granted to the Department
66. The Bureau adequately considered and responded to written comments submitted
67. The Bureau has met its burden to show that the permit meets the requirements of
the Air Quality Control Act and the Air Quality Control Regulations.
68. No technical evidence was offered during the hearing to support denial of the
permit.
Areas of Concern
F or ease of use the Hearing Officer has included all the proposed findings of facts submitted by
NMED. The Hearing concurs with the adoption of NMED’s proposed findings except for 8
paragraphs. The Hearing Officer has not adopted paragraph numbers 1, 2, 16, 17, and conclusions
of law 62, 63, 66, or 67 for the following reasons. There are two main concerns that can be broadly
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Aspects of environmental justice can be broken into separate components; including meaningful
Notice
A review of the record proper indicates that the decision to hold a public hearing was not
flagged as an area where public participation would be warranted. Had the bureau requested that
the hearing be noticed and scheduled based on the expectation of public comment, it is likely that
a different date, location, and means of notifying the public, would have been used. The room
allocated for the hearing, barely contained members of the public who wished to attend.
The Affidavits of publication of Legal Notice are attached as NMED’s exhibits 2, 3, and
4. The notice itself indicates under the Availability of Information Section, that interested
persons must submit their written comments to the New Mexico Environment Air Quality
Bureau, 525 Camino de Los Marquez, Suite 1, Santa Fe, NM 87505. This section does not
indicate that failure to submit requests in writing will result in them not being responded to by
the Bureau. Although technical, the Notice requirements require strict compliance.
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must inform the department in writing of their interest in the permit application in order to have a 30 day period to
review and comment on the analysis under Subsection B of 20.2.72.206 NMAC below. The notice shall clearly
state that any person who does not express such interest in writing prior to the end of the initial 30 day comment
period will not receive notification of the availability of the analysis and thus forewarn such person of the need to
express interest in writing if they desire to review and comment on the analysis
The purpose of public notice other than, pro-forma, is to give actual notice to members of
the public who may wish to participate in the process or may be impacted by the proposed penTlit
change. NMAC requires that hearings be noticed to the public, and each newspaper has its own
deadlines to submit legal notices. Some papers may require that submissions be on certain days to
To my knowledge NMED does not have a specific policy related to the timing of notice,
but ostensibly, New Year’s Eve December 31, 2017 is traditionally a time when people are
preparing for a holiday. If the desire is to get actual notice to the public, then timing notices around
Federal Holidays is likely to result in decreased public participation in permit or rule making
hearings.
Had the Secretary been informed about the likelihood of public participation, the Hearing
Officer would have had the option of scheduling the hearing in places that would be affected by
the permit. The Air Quality Bureau picked the time and location of the hearing on Monday
In this instance, this permit will impact all areas of the state. Northwestern New Mexico
i.e. the San Juan Basin, and Southern New Mexico i.e. the Permian basin where significant
amounts of oil and gas are located are likely to be impacted. New Mexico’s unique geography and
Checkerboard also means consultation and notice with Tribes. The notice itself was published in
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English and Spanish but no attempts weie made to translate the notice into Navajo. Although not
a requirement, as in Solid Waste Permits, broadening the methods of notice delivery would have
provided broader tribal consultation and greater participation. The Public Participation Matrix,
listed as NMED’s Exhibit 10, indicates that Tribes were emailed a copy of the notice on December
31, 2017. The public in general received notice on December 31, 2017 via a legal notice. There
Environmental Justice
Comments submitted by the public were past the deadline of Notice of Intent to File technical
Many members of the public, some of which belonged to various nonprofits, environmental
groups, and faith based groups had questions about the proposed draft permit. They included;
issues related to health and safety, compliance, and best available technology, environmental
Many of the participants in the Public Hearing knew, or should have known, by their
previous experience in permit hearings that there were deadlines for the submission of technical
testimony. Many of the public commentators were involved in all aspects of rulemaking and were
attorneys. so their level of sophistication, regarding the permitting process and regulatory affairs
far exceeded the average lay person. The NMED cannot insist that interested parties participate
in the pen-nitting process early, rather than wait until the last blow of the horn, to voice concerns.
This led to a dilemma for the Hearing Officer, as to what weight, should be allocated to the
testimony in public comment, versus the pre-filed written technical testimony submitted by NMED
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and NMOGA, including scientific modeling of air quality which was submitted by both entities.
A cursory review of the record, indicating that no members of the public or industry filed NOT’s
to present technical testimony, or opposed the permit hearing, could lead the fact finder to conclude
NMED’s findings of fact indicate that there were 13 public commenters. This tends to
diminish both the volume, and flavor, of public participation and the fact that many public
commenters were part of much larger membership organizations. These groups, despite learning
of the permit hearing, at the tail end of the permitting review period, had serious reservations about
the draft permit, and voiced their opposition to the permit, while identifying several issues of public
concern, namely methane in the four corners, VOC’s, and the health and safety concerns of people
who live near oil and gas facilities. The concern voiced by the public was that the NMED’s draft
penuit was at best a floor, rather than a ceiling, and missed opportunities to create meaningful
change by adopting best techno]ogy and keeping pace with neighboring states that were more
innovative in their permitting procedures and incorporated more stringent standards than the
federal standards. Many members of the public expressed concern about the BLM’s rule revisions
and the potential for EPA rule revision which could adversely impact New Mexico.
As an example, the Western Environmental Law Center, submitted public comment that included
signatures from twenty-two different non-profits including tribal, faith based, and conservation
voters. TP Email Dated January 5, 2018. One area, that both the public and members of the oil and
gas industry, seemed to find commonality was the length and timing of the permit review period.
“NMED designated a permit review and comment period of astonishingly minuscule four business
days over the New Year Holiday and end day of January 5, 2018”. via email. See letter from
Western Environmental Law Center delivered via email dated January 5, 2018.
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The Independent Petroleum Association requested additional time to submit formal
comments, “My members feel strongly that the short comment period combined with the
Christmas & New Year’s Holiday made it impossible to both digest the document and then make
The public relayed frustration about the squandering of natural resources due to inadequate
regulation. Individuals cited the waste of $27 million dollars per year of natural gas and how lost
royalties equated to a failure to buttress state revenues, while potentially harming future
generations. A diverse set of eyes reviewing the draft permit certainly had questions that may not
have occurred to the drafters and were not addressed in the draft permitting process.
Fortunately, the New Mexico Supreme Court has provided much needed guidance about
the admission of non-technical public comment in the public hearing process and whether that
should be considered by the Hearing Officer. Colonias Dev. Council v. Rhino Environmental
SVCS., mc, provides guidance on the issue of whether a Hearing Officers review of testimony is
limited to technical issues. 2005-NMSC-024 13$ N.M. 133, 117 P.3d 939 The New Mexico
Supreme Court indicated that the Hearing Officer was not confined to purely technical testimony
but also could address factors that related to the cumulative impacts on communities and their
quality of life.
permits and how they impact a community. Concerns about methane in the four corners, fugitive
emissions, and health and safety for communities that contain oil and gas facilities are an issue of
public concern.
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20. 1.4.6.NMAC (1997) states the objective of the hearing procedures is to ensure the
ability of all persons and entities to participate. There are not separate rules for the regulated
community and the public. The intent of the Legislature was to involve the public in the permitting
process. Here, the revision of the Oil and Gas permit has been unchanged for 18 years and there is
considerable expansion of the oil and gas permitting, particularly in Southern New Mexico. The
Secretary should consider issues relating to public health and welfare and review the non-technical
comments made by a broad cross section of the state. Community concerns and particularly
concerns about health and welfare should be taken into consideration when drafting permits.
The public commenters raised factual issues related to the timing of the public comment
period, the permitting process, environmental accidents, air quality rear schools, and the
disproportionate impact of environmental health effects in areas close to industry and for tribal
communities. Members of the public were concerned about the WPX explosion and setbacks for
occupied structures. BLM is likely the appropriate regulatory entity to address the WPX
catastrophic failure but NMED, should also be mindful, that the public looks to past environmental
The communities of Nageezi, Toneon, and Counselor, as well as the Navajo Nation, have
expressed concerns about the quality of life and the adverse impact and cumulative impacts of
increased oil and gas permitting as it affects quality of life. See Administrative Record email
correspondence from Arlene Griffin dated Wednesday February 14. 2018 including
correspondence dated February 6, 2017 from the President of the Navajo Nation, Russell Begaye,
“I am concerned that increased surface activity from drilling is interrupting the daily lives of
Navajo people who live in Navajo Nation Chapters such as Counselor, Nageezie, Toneon and Ojo
Encino”. An email delivery of legal notice does not seem to meet definition of meaningful
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consultation to tribal communities. The Lybrook school was also mentioned by a public
commenter, as emissions from nearby oil and gas facilities were thought to be creating public
The overlapping jurisdiction in the Checkboard area, with the BLM, State, and the Federal
Government, have made it difficult for the public to identify the proper regulatory entity to report
compliance issues to. The public wishes to alert regulators to potential dangers to health and
property in their local area. The Air Quality Bureau was tasked with addressing the construction
permit process for oil and gas permits and did not address issues that were deemed outside their
regulatory purview. The Bureau believes that they lack statutory authority to make revisions that
would impact other regulatory entities. The Hearing Officer concurs with NMED, that the desire
for a statewide methane rule, should be addressed in rulemaking or at the legislative level. The
proper forum for proposed rule change would be before the Environmental Improvement Board
The Air Quality Bureau, largely confined their analysis of the permitting process to the
technical aspects of the permit. Through no fault of the bureau, a technocratic approach does little
to allay concerns from the public, that an oil and gas facility located by a school or home may
result in an accident, like the WPX catastrophic failure, that could be injurious to human life.
Many citizens who reside in urban hubs, like Santa Fe or Albuquerque, are potentially protected
from industrial accidents by existing zoning ordinances and local ordinances that prohibit the
placement of facilities near occupied structures. These same buffer zones may not exist for people
in rural areas who are in closer proximity to oil and gas facilities.
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NMED did attempt to include the public in its pemlitting process and did outreach, see
NMED’s public participation matrix. Ultimately, the responsibility lies with the Department to
translate difficult scientific concepts for the public and to direct them to the appropriate regulatory
agency. The Air Quality Bureau, is but one part of a larger whole, and cannot be tasked with
Ideally, the permitting process would allow for significant public participation. The
administrative record is replete with hundreds of texts and emails from the regulated community
including detailed revisions, scientific analysis, and comments on the proposed draft permit,
Industry was actively involved in the permitting process since 2015. Despite the early
submit formal comments, “My members feel strongly that the short comment period combined
with the Christmas & New Year’s Holiday made it impossible to both digest the document and
then make technical comments” TP p 1 Independent Petroleum Association of New Mexico via
email. The regulated community had difficulty digesting the proposed permit due to its complexity
and had been meeting and discussing various revisions since 2015. The general public’s ability to
comprehend and propose technical suggestions to the draft pennit was likely impacted by
It is natural that the regulated community would have an interest in reviewing the proposed
permit revision, as it would impact its constituents, but there is little involvement from the public
until the notice portion of the public hearing, published on New Year’s Eve in the legal notices of
3 newspapers. That may simply be a factor of disinterest on the part of the public, or it may reflect
30
a failure to engage other groups outside the regulatory sphere. Part of meaningful involvement in
the permitting process is making materials related to the process user friendly demonstrating
repeated attempts to engage the public. Federal and State authority overlap and federal regulators
are relying on state regulators, to implement their regulations and report compliance violations.
Who better than state regulators to address issues of local concern? As the Secretary of the
Environment, the Rhino decision makes plain that the Secretary, can consider factors that affect
the community as part of health and safety concerns, and is not strictly limited to a technical
review.
The narrow issue here is whether the proposed draft General Construction Permit (GCP
Oil and Gas) should be granted. The burden of proof lies with the department. The legal standard
is the preponderance of evidence. Procedural defects to the notice of public hearing, timing, and
opportunity for public participation may have tainted the outcome of the hearing.
Upon review of the entire record proper in this matter, the Hearing Officer recommends
that the Secretary deny the request for the GCP-Oil and Gas permit, at this time, until the hearing
can be re-noticed, with advertisements in Spanish and Navajo, preferably in a medium intended to
reach tribal communities and rural communities. The Hearing Officer does not believe the Bureau
met its burden of proof or engaged in meaningful consultation with tribes, particularly the Navajo
A review of the record indicates that the Bureau did not consider that the proposed revision
of the draft permit a matter of public concern. Undoubtedly, this was an unintended consequence,
as tremendous amount of time and effort was spent on revising the draft permit. There are currently
about 400 GCP -1 and GCP-4 permits. (TP $1). There are approximately 1,500 to 2,000 regular
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part 72 minor source permits. (TP $1). There are approximately 150 Title V facilities. (TP 81).
There are approximately 20 employees of NMED who are working on compliance. (TP $1) Title
V permits are inspected every 2 years. Synthetic minor AP sources are inspected every 5 years.
(1? 81). Once a construction pennit is granted it is granted in perpetuity. Both the modeling and
preparation for the hearing demonstrate a great deal of thought and demanding work to create a
better permit that would reflect current technology and best practices. The Hearing Officer would
recommend that the hearing be re-opened and two additional hearings be held. One in Northern
New Mexico, preferably in a Checkerboard area, with a high volume of oil and gas permits and
one in Southern New Mexico, in an area with a high number of oil and gas penriits. Members of
the public who wished to submit technical testimony would have an opportunity to do so under a
revised scheduling order and subsequent to re-noticing and re-opening of the record.
Additional hearings, notice provisions, and accessibility would enable the Secretary to
make a more informed decision and create a more complete record. This could be done in as little
as 3 to 6 months and would ensure both adequate and meaningful public participation as well as
due process. A revision of an existing permit that has been in place for eighteen years should
include time and meaningful opportunity for the public to raise issues of public concern. The
appropriate method for the public to address some of the concerns raised in the hearing may be to
request a rule change via the Environmental Improvement Board, but that does not preclude the
Secretary from addressing some of the issues raised by community members in the current public
hearing.
If the Secretary is inclined to grant the proposed GCP oil and gas permit, now, as submitted
by NMED, perhaps more robust efforts could be made in the future to engage the public in the
pennitting process.
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Erin Anderson, Administrative Law Judge
New Mexico Environment Department
Hearing Officer for AQB 17-26 (P)
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CERTIFICATE OF SERVICE
I hereby certify that a copy of the Hearing Officer’s Report to 20.1.4.100 (E)(2) NMAC
was sent via email on March 27, 2018 and via mail on March 28, 2018 to the following parties:
Andrew P. Knight
Office of General Counsel
New Mexico Environment Department
1190 South Saint Francis Drive
Santa Fe, New Mexico 87505
email: Andrew. Knight@state.nm.us
Cottnsel for the New Mexico Environment Department
Louis W. Rose
Montgomery & Andrews
325 Paseo De Peralta
Santa Fe, New Mexico $7501
email: lrose@montand.com
Christina C. Sheehan
Jennifer L. Bradfute
Post Office Box 2168
500 Fourth Street NW, Suite 1000
Albuquerque, New Mexico 87103-2 168
email: Christina.shehan@modrall.com