Aux Sable Liquid Products Clean Air Act Settlement

(Washington, DC - October 29, 2018) - The U.S. Environmental Protection Agency (EPA) and the U.S. Department of Justice (DOJ) announced a settlement that requires Aux Sable Liquid Products LP (Aux Sable) to strengthen air pollution controls and reduce air pollution at its natural gas processing facility, located southwest of Chicago. The facility, which is the largest natural gas processing plant in the United States, is located within the Chicago Non-Attainment Area for ground-level ozone, which includes the greater Chicago area and the northwest Indiana counties of Lake and Porter.

• Overview
• Violations
• Injunctive Relief
• Pollutant Impacts
• Health Effects and Environmental Benefits
• Civil Penalty
• Comment Period
• Contact

Overview of Company

Aux Sable Liquid Products LP (Aux Sable) owns and operates one of the largest natural gas liquids (NGL) extraction and fractionation facilities in North America. The Facility is in Morris, Grundy County, Illinois, approximately 50 miles southwest of Chicago. Aux Sable’s Facility is capable of processing 2.1 billion cubic feet per day of natural gas and can produce approximately 107,0000 barrels per day of NGL products. The Facility sits within an area within the Greater Chicago Metropolitan Area that is designated as nonattainment of the National Ambient Air Quality Standards (NAAQS) for ground-level ozone (smog), known as the “Chicago ozone nonattainment area.”

Violations

The United States has filed a complaint against Aux Sable for violations of the Clean Air Act and Illinois’ State Implementation Plan (SIP), which was established to achieve and maintain the NAAQS in the State, including the NAAQS for ground-level ozone.

The complaint alleges that Aux Sable failed to comply with the Nonattainment Area New Source Review (NNSR) Rule under the Illinois SIP that is applicable to sources of volatile organic compounds (VOC) in the Chicago ozone nonattainment area. When Aux Sable constructed its Facility in 1999, Aux Sable had obtained a “synthetic minor” limit in its SIP construction permit, limiting fugitive VOC emissions from equipment leaks to 12 tons per year, which would exempt Aux Sable from complying with major source requirements under the NNSR Rule. Aux Sable’s construction permit application, however, contained significant errors in its fugitive emission calculations done to support granting the synthetic minor limit, leading to a huge underestimate of VOC emissions at the Facility. Thus, Aux Sable’s Facility has exceeded the synthetic minor limit by approximately 27.5 tons per year since the Facility began operation in 2000. Aux Sable also has exceeded the 25 tons per year threshold for triggering major source requirements under the NNSR Rule, and has failed to comply with such requirements, including achieving Lowest Achievable Emission Rate (LAER) and obtaining emission offsets. 

The complaint also alleges that Aux Sable has failed to comply with: (1) New Source Performance Standards (NSPS) applicable to natural gas processing facilities, including Leak Detection and Repair (LDAR) requirements to limit fugitive VOC emission from leaking equipment; (2) NSPS regulations applicable to synthetic organic chemical manufacturing distillation units and reactor processes; (3) requirements under the NSPS for monitoring the presence of a pilot flame at the Facility’s two flares for the entirety of 2014; (4) requirements to obtain sufficient VOC emission allotments under the Illinois Emission Marketing Reduction System (ERMS), which is a VOC cap-and-trade program under the Illinois SIP that covers the Chicago ozone nonattainment area; (5) correct reporting of VOC emissions under the Illinois SIP’s annual emission report program; and (6) an emission limit for oxides of nitrogen (NOx) applicable to one of the Facility’s two process heaters that was established in a 2015 construction permit authorizing construction of a second fractionation unit at the Facility.  

Injunctive Relief

Aux Sable has agreed to the following elements of injunctive relief: (1) comply with NSPS Subpart OOOO at process units currently subject to the less stringent NSPS Subpart KKK (which includes implementation of connector monitoring at such units); (2) achieve and maintain 99% VOC emission control efficiency at the facility’s off-gas incinerators; (3) implement a LDAR Program that will bring the facility into compliance with LDAR regulations, and which includes measures to mitigate the environmental harm caused by alleged noncompliance; (4) comply with NSPS Subpart NNN and RRR applicable to synthetic organic chemical manufacturing distillation units and reactor processes, respectively, including meeting specified flare testing, operation, and monitoring requirements; (5) retain a third-party to conduct a comprehensive audit of the Facility’s compliance with the CAA and its implementing regulations; (6) install ultra-low NO_x burners at the Facility’s two process heaters and comply with tightened NOx emission limits for the process heaters; and (7) submission of applications for non-Title V permit amendments to incorporate consent decree requirements that will survive termination of the Consent Decree.   

It is estimated that Aux Sable will spend $1.5 – 2 million in capital costs and $250,000-$500,000 per year in incremental operational and maintenance costs to complete the required injunctive relief at its facility. 

Also, to mitigate the environmental harm caused alleged noncompliance, Aux Sable has agreed to implement mitigation projects to reduce VOC and NO_x emissions at locomotive switchyards located in the Chicago Ozone Nonattainment Area, which will include repowering switcher locomotives and installing switcher locomotive idle-reduction technology. Aux Sable will spend $3 million to implement these projects. 

Finally, Aux Sable has addressed its noncompliance with the Illinois ERMS program by purchasing from the Illinois EPA the necessary VOC emission allotments and required emission excursion compensation to cover VOC emission-allotment deficiencies for the period of 2001-2015, which totaled over $156,000. Aux Sable as also submitted to Illinois corrections to past annual emission reports.

Pollutant Impacts

When fully implemented, EPA estimates that the new controls and requirements would result in emission reductions of approximately 18.8 tons per year of VOCs and between 42.3 to 52.3 tons per year of NO_x

Health Effects and Environmental Benefits

VOCs contribute to ground-level ozone and to sensory irritation symptoms, allergies and asthma, and neurological and liver toxicity. Certain VOCs are also known carcinogens. NOx emissions contribute to ground level ozone as well as acid rain, particulate matter, water quality deterioration, and visual impairment.  

Ground-level ozone exposure is linked to a variety of short-term health problems, including lung irritation and difficulty breathing, as well as long-term problems, such as permanent lung damage from repeated exposure, aggravated asthma, reduced lung capacity, and increased susceptibility to respiratory illnesses such as pneumonia and bronchitis. People with lung disease, children, older adults, and people who are active can be affected when ozone levels are unhealthy.

Civil Penalty

The proposed decree requires Aux Sable to pay a $2.7 million civil penalty.

Comment Period

The proposed settlement, lodged in the U.S. District Court for the Northern District of Illinois, is subject to a 30-day public comment period and final court approval.  Information on submitting comment is available at the Department of Justice.

For more information, contact:

Mark Palermo (Attorney-Advisor)
EPA Office of Civil Enforcement, Air Enforcement Division
U. S. Environmental Protection Agency
1200 Pennsylvania Avenue, NW, Mailcode 2242A, Washington DC, 20016
(202) 564-8894
[email protected]