£PA-
Thursday
= July 28, 1994
Part VII
Environmental
Protection Agency
40 CFR Parts 261 and 266
Identification and Listing of Hazardous
Waste; Final Rule
Recycled/Recyclable
Printed with Soy/Canola Ink on paper that
contains at least 50% recycled fiber
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38536 Federal Register / Vol. 59, No. 144 / Thursday, July 28, 1994 / Rules and Regulations
ENVIRONMENTAL PROTECTION
AGENCY
40 CFR Parts 261 and 266
[EPA-530-Z-94-009; SWH-FRL.-5022-4]
Identification and Listing of Hazardous
Waste; Amendments to Definition of
Solid Waste
AGENCY: Environmental Protection
Agency.
ACTION: Final rule.
SUMMARY: The Environmental Protection
Agency is today excluding from the
RCRA regulatory definition of solid
waste certain in-process recycled
secondary materials utilized by the
petroleum refining industry.
Specifically, today's rule states that oil
recovered from petroleum refinery
wastewaters and from other sources,
both on-site and off-site, is excluded
from the regulatory definition of solid
waste if it is subsequently inserted
(along with normal process streams)
into the petroleum refining process
prior to crude distillation or catalytic
cracking.
EFFECTIVE DATE: This final rule is
effective on July 28,1994.
ADDRESSES: The official record for this
rulemaking is identified as Docket
Number F-94-SWF-FFFFF and is
located in the EPA RCRA docket, Room
2616,401M Street SW., Washington,
DC 20460. The docket is open from 9:00
to 4:00, Monday through Friday, except
for Federal holidays. The public must
make an appointment to review docket
materials by calling (202) 260-9327. The
public may copy a maximum of 100
pages from any one regulatory docket at
no cost. Additional copies cost $.15 per
page.
FOR FURTHER INFORMATION CONTACT:
General questions about the regulatory
requirements under RCRA should be
directed to the RCRA/Superfund
Hotline, Office of Solid Waste, U.S.
Environmental Protection Agency, 401
M Street SW., Washington, DC 20460;
Telephone: toll-free at (800) 424-9346,
or locally at (703) 412-9810. For the
hearing impaired, the number is (800)
553-7672 (toll-free) or (703) 412-3323
(local). For information on specific
aspects of today's notice, contact Ross
Elliott, Office of Solid Waste (5304),
U.S. Environmental Protection Agency,
401M Street SW., Washington, DC
20460, (202) 260-8551.
SUPPLEMENTARY INFORMATION:
Outline of Today's Rule
I. Authority
n. Background
A. Statutory Definition of Solid Waste
B. Prior Litigation
C. January 8,1988 Proposal
D. Description of Petroleum Exploration,
Development & Production, and the
Petroleum Refining Process
E. Petroleum Refining Wastewater
Treatment
F. Recovered Oil and Recovered Oil
Systems
G. Status of Wastewater Streams,
Wastewater Treatment Units, Recovered
Oil, and Recovered Oil Systems Under
Current RCRA. Rules
III. Summary of Today's Final Rule
IV. Scope of Today's Final Rule
A. Limiting Scope to Recovered Oil from
Petroleum Refining, Exploration and
Production
B. Rationale for Excluding Recovered Oil
and Not Wastewater from Being a Solid
Waste
C. Rationale for Excluding Recovered Oil
from Off-Site Sources
V. Rationale for Conditioning the Exclusion
on Recovered Oil Not Being Placed on
the Land and Not Being Accumulated
Speculatively
VI. Rationale for Not Excluding Recovered
Oil that is Inserted into the Petroleum
Refining Process After Crude Distillation
or Catalytic Cracking (i.e., into Petroleum
Coker)
VII. Rationale for Not Excluding Other Oil-
Bearing Hazardous Materials
VIII. Demonstration that Recovered Oil Meets
Conditions of Exclusion
IX. Examples of How Today's Rale Operates
X. Relationship to Other Programs
A. Clean Air Act (Benzene NESHAP)
B. Clean Water Act
C.RCRA
1. RCRA Air Emission Standards
2. Used Oil
D. Enforcement; Effect of Today's Final
Rule on RCRA 3007, 3013, 7002 and
7003 Authorities
XI. State Authority
A. Applicability of Rules in Authorized
States
B. Effect on State Authorization
XII. Regulatory Requirements
A. Regulatory Impact Analysis Pursuant to
Executive Order No. 12866
B. Regulatory Flexibility Act
C. Paperwork Reduction Act
C. Paperwor
I. Authority
These regulations are issued under
the authority of Sections 2002 and 3001
et seq. of the Solid Waste Disposal Act,
as amended by the Resource
Conservation and Recovery Act, as
amended by the Hazardous and Solid
Waste Amendments of 1984,42 U.S.C.
6912 and 6921 et seq.
EL Background
A. Statutory Definition of Solid Waste
The statutory definition of solid
waste, RCRA Section 1004 (27), is the
starting point for determining RCRA
Subtitle C jurisdiction. This is because
the term "hazardous waste" is a subset
of "solid waste." RCRA Sections 1004
(5) and 1004 (27). The statutory
definition of solid waste indicates that
"garbage, refuse, sludge * * * and other
discarded material" are solid wastes.
The critical issue is when secondary
materials (see definition at 50 FR at 616
n. 4, Jan. 4,1985) that are going to be
recycled can be solid wastes. Today's
rulemaking addresses this question for
certain operations commonly occurring
in the petroleum refining and related
industries.
The reader should note that EPA is
conducting an assessment of the RCRA
Definition of Solid Waste, as described
hi the EPA report, RCRA
Implementation Study Update.1 This
ongoing effort may result hi proposed
regulatory changes to the definition set
forth in 40 CFR 261.2 and related
requirements. Today's action, however,
is fairly narrow, applying to situations
where certain oil-bearing secondary
materials are used or reused within the
petroleum refining process. EPA will
continue its broad policy review of the
Definition of Solid Waste, but deemed
unnecessary any delay in issuing
today's rule.
B. Prior Litigation
In its decision in American Mining
Congress v. EPA, 824 F. 2dll77 (D.C.
Cir. 1987) (AMCi), a divided panel of
the District of Columbia Circuit held
that the Agency's rules defining the
statutory term "solid waste," RCRA
Section 1004 (27), exceeded the.
Agency's statutory authority to the
extent that the rules asserted RCRA
authority over "materials that are
recycled and reused in an ongoing
manufacturing or industrial process."
Id. at 1186 (emphasis original). Because
"these materials have not yet become
part of the waste disposal problem", id.,
they are not yet "discarded" within the
meaning of Section 1004 (27) and so
'cannot be considered to be "solid
wastes." Subsequent judicial decisions
confirm that the holding in AMCI is
limited to situations involving
"materials that are 'destined for
immediate reuse in another phase of the
industry's ongoing production process"
and that 'have not yet become part of
the waste disposal problem.'" .American
Mining Congress v. EPA, 907 F. 2d 1179,
1186 (D.C. Cir. 1990 (AMC fl) (emphasis
original); American Petroleum Inst. v.
EPA, 906 F. 2d 729, 740-41 (D.C. Cir.
1990) (API); Shell Oil v. EPA, 950 F. 2d
741, 755-56 (D.C. Cir. 1991); Chemical
Waste Management v. EPA, 976 F. 2d 2,
1 RCRA Implementation Study Update: The
Definition of Solid Waste, U.S. EPA, July 1992,
#EPA530-R-92-021.
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Federal Register / Vol. 59, No. 144 / Thursday, July 28, 1994 /Rules and Regulations 3853?
14 (D.C. Or. 1992), cert, denied 113
S.Ct, 1961 (1993).
C. January 8,1988 Proposal
On Januaiy 8,1988, EPA proposed
rules to implement the AMCI opinion.
Of particular significance to today's
action, EPA. proposed certain
amendments relating to the scope of the
regulatory definition of solid waste as
applied to operations occurring within
the petroleum refining industry. In
particular, the Agency proposed to
exclude from the regulatory definition
of solid waste secondary materials
associated with "on-going fuel
production activities in the petroleum
refining industry. These activities
involve situations where crude oil is
refined, and oil-bearing residues from
that refining process are returned for
further refining as part of one
continuous and on-going process." 53
FR at 525 (Jan. 8,1988). the Agency
specifically proposed to exclude oil-
bearing residues from the refining
process when those residues are
generated on-site and inserted into that
on-site petroleum refining process or
cokor, provided that these residues are
not managed in such a way as to be
"characterized by elements of discard"
such as placement in a disposal unit
like a surface impoundment. Id. EPA is
not taking any action today with respect
to the portions of the January 8,1988
proposal dealing with non-petroleum
materials. These issues are being
addressed by other on-going Agency
activities (see above, Section H.A.). The
Agency is, as described below, taking
final action with respect to the
petroleum materials.
D. Description of Petroleum Exploration,
Development & Production, and the
Petroleum Refining Process
The presence of petroleum in geologic
formations is confirmed by the drilling
of exploratory wells. Once located, the
development of a petroleum reservoir
includes the drilling of additional wells
to extract the oil or gas, and well
completion and stimulation techniques
designed to increase the recovery of oil
or gas from that reservoir. Petroleum
production generally includes all the
activities associated with the recovery of
petroleum from the geologic formation.
These production activities involve the
operation and maintenance of the
producing well, and the handling and
separation of the recovered crude oil,
natural gas, natural gas liquids, and
water. The separation of water/crude oil
emulsions is performed in tanks by
gravity settling, or heat may be added to
separate emulsions. Crude oil is then
transported via pipeline, vehicle or
vessel to stock tanks and ultimately to
the refinery.
Petroleum refining involves several
manufacturing operations and
processes, including crude desalting,
atmospheric and vacuum distillation,
hydrotreating, catalytic cracking,
thermal processing and residual
upgrading, light hydrocarbon
processing, hydrocracking, catalytic
reforming, extraction, isomerization,
lubricating oil processing, sulfur
removal and recovery, and product
blending and inventory. Products
manufactured from petroleum refining
include hydrogen, fuel gas, sulfur,
liquified petroleum gas, butane,
aromatic feedstocks, leaded and
unleaded motor gasolines, jet fuel,
kerosene, diesel, heating oil, fuel oil,
and asphalt. See generally, 55 FR at
46359 (Nov. 2,1990); and EPA's
Development Document for the effluent
guidelines for the petroleum refining
industry.2
E. Petroleum Refining Wastewater
Treatment
Petroleum refining operations
generate large amounts of wastewater
that require treatment hi order to reduce
or remove wastewater pollutants so as to
produce effluent that meets discharge
requirements of the Clean Water Act,
Principal sources of wastewater are
refinery process units (where
wastewater comes in direct contact with
oil), as well as oily cooling waters from
cooling towers and heat exchangers.
Storm water, which may be subject to
minor oil contamination from leaks or
spills, is also a type of wastewater at a
petroleum refinery.3
Wastewater treatment systems at
petroleum refineries generally consist
of: (1) a drainage and collection system
to collect and carry wastewaters to
treatment units; (2) a primary treatment
system to separate oil/water/solids, and
(3) a secondary treatment system,
normally involving biological: treatment,
to remove soluble biodegradable
wastewater pollutants. Some refineries
have tertiary treatment systems as well,
consisting of water polishing steps
before discharge. Secondary and tertiary
treatment is frequently conducted using
surface impoundments. Primary
treatment, i.e. the initial separation of
2 Section ffl of Development Document for
Effluent Limitations Guidelines, New Source
Performance Standards and Pretreatmeht
Standards for the Petroleum Refining Point Source
Category, U.S. EPA, October 1982, National ;
Technical Information Service #PB838-172569.
3 Id., and see Manual on Disposal of Refinery
Wastes: Volume on Liquid Wastes, American
Petroleum Institute, 1969, pp. 3-4 to 3-5.
water, oil, and solids, normally occurs
in tanks.
F. Recovered Oil and Recovered Oil
Systems
Today's rule deals primarily with the
status under RCSA Subtitle C of
recovered pil which is returned to the
petroleum refining process. "Recovere^
oil" is a generic term that applies to
secondary materials consisting
primarily of oil such as oil separator
skimmings from plant wastewaters, slop
oil and emulsions, oil skimmed from
ballast water tanks, and oil from refinery
process units (e.g,, off-specification
process streams). As explained in detail
below, today's rule excludes from the
definition of solid waste recovered oil
from petroleum exploration and n
production, petroleum refining, and
transportation incident to either of these
activities, when the recovered oil is
reinserted into a petroleum refining
process. The exclusion does not apply
to recovered oil generated from
petroleum operations downstream of
refining such as marketing or retail
sales—because this Oil is already
excluded for the most part, as discussed
below —, or from non-petroleum
industry operations.
This rule also does not exclude
hazardous sludges (such as wastes
K048, KOSi, or FO37) or other similar
wastes from regulation. Distinguishing
between these wastes and recovered oil
is sometimes difficult. Factors EPA will
consider in making this distinction
include water content, solids content,
and potentially, metals content. See
generally 50 FRat 49170 n. 16 (Nov. 29,
1985). EPA repeats, however, that the
salient characteristic of recovered oil is
the obvious one: that it consist primarily
of oil.
Used oil also is not a type of
recovered oil, and hence remains
subject to the applicable regulations for
used oil. See generally 59 FR 10550
(March 4,1994). The only exception is
when de minintis quantities of used oil:
are incidentally captured by refinery
wastewater treatment systems. This
could occur, for example, when small •
leaks, spills, or drippings of used oil
from machinery, pumps, or other
refinery equipment during normal
operations are lost to the wastewater
treatment system. In these instances, the
used oil present in de minimis i
quantities in wastewater is not subject
to the used oil standards. See generally
57 FR at 41566 (Sept. 10,1992).
The objective of a recovered oil
system is to gather and recycle oil
generated throughout the refinery, or (to
a lesser extent) generated from off-site
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38538 Federal Register / Vol. 59, No. 144 / Thursday, July 28, 1994 / Rules and Regulations
narrowing the proposal (which would
have excluded petroleum refining
wastewaters containing oil that
eventually gets recycled) by finding that
refinery operations upstream of
recovered oil systems involve
wastewater treatment, not an on-going
refining process. Thus, petroleum
refinery wastewaters undergoing
treatment should not be excluded from
the definition of solid waste. In
addition, even if these wastewater
treatment operations are characterized
sources.4 Recovered oil operations
almost always occur in tanks, usually a
series of tanks that successively purify
the oil to the point where it is
sufficiently clean and dewatered to be
inserted into the petroleum refining
process. 53 FR at 525. Some oil is
collected directly from process units
and sent by means of pipes or vacuum
trucks to the refinery's dedicated oil
tanks. Occasionally this recovered oil is
of sufficient purity that it can be
inserted directly into the refining
process with little or no treatment in the
recovered oil system.
Recovered oil from plant wastewater
operations is most often a water-in-oil
emulsion, which is sent first to tanks
where gravity separates much of it into
oil, emulsion, and water layers. The
intermediate layer of emulsions then
may be sent to other tanks where it will
undergo further emulsion-breaking
treatment (e.g., mechanical centrifuging,
heating, or chemical additives). At the
end of each stage, the separated water is
returned to the refinery oil/water
separators, while the oil is either further
treated or, if sufficiently dewatered, is
returned to one or more refinery process
units. These may include crude oil
distillation or catalytic cracking units.5
G. Status of Wastewater Streams,
Wastewater Treatment Units, Recovered
Oil, and Recovered Oil Systems Under
Current RCRA Rules
Under present RCRA regulations,
petroleum refinery wastewaters
upstream of a wastewater discharge that
is subject to regulation under Sections
307(b) or 402 of the Clean Water Act, are
solid wastes. See 40 CFR 261.4(a)(l) and
(2). Such petroleum refinery
wastewaters are hazardous if they
exhibit a characteristic of hazardous
waste, or are listed hazardous wastes
(although there are presently no specific
hazardous waste listings for petroleum
refining industry wastewaters).
Petroleum refining wastewater storage
and treatment operations generate a
number of listed hazardous wastes. In
particular, sludges from primary
treatment operations are listed under
the generic F037 and F038 listings.
Sludges from Dissolved Air Flotation
(DAF) wastewater treatment units and
API separators (particular types of
primary wastewater treatment devices)
are listed as wastes K048 and K051,
respectively. Slop oil systems generate
listed wastes as well: slop oil emulsion
solids are listed as K049. Also, EPA is
« See RCRA Docket No. F-87-SWRP-FFFFF,
submission by the American Petroleum Institute on
"Recovered Refinery Oil System", April 16,1993.
"Id.
studying additional petroleum refining
wastes as part of a listing determination
required by RCRA 3001 (e)(2).
In addition, petroleum refineries
typically generate large volumes of
wastes that exhibit hazardous waste
characteristics. Individual wastewater
streams upstream of wastewater
treatment may exhibit the Toxkity
Characteristic, particularly for
chromium, lead and benzene (see 40
CFR 261.24), or the characteristics of
corrosivity or ignitability (40 CFR
261.21 and 261.22, respectively). These
wastewaters may also contain other
hazardous constituents that are not part
of the Toxicity Characteristic. See
Tables in Section V, Development
Document for Effluent Limitations
Guidelines, New Source Perfomiance
Standards and Pretreatment Standards
for the Petroleum Refining Point Source
Category. Sludges generated from
secondary or tertiary wastewater
treatment also may exhibit one or more
hazardous waste characteristics.
Tanks storing listed wastes which
engage in primary wastewater treatment
operations are presently exempt from
federal Subtitle C regulation because
they are wastewater treatment units (i.e.
tanks). 40 CFR 264.1 (g)(6) and 265.1
(c)(10). Hazardous wastes removed from
those units are subject to regulation
upon exiting the tanks. However,
recovered oil is exempt from Subtitle C
regulation, as is any fuel produced from
such oil, under the current exemptions
at § 261.6 (a)(3)(iv)-(vii). The units
engaged in recovered oil operations
would also be exempt under current
regulations,-to the extent that these
units are managing materials exempt
under § 261.6 (a)(3)(iv)-(vi).
HI. Summary of Today's Finail Rule
EPA is finalizing a revised version of
the January 8,1988 proposal in today's
notice. The final rule states in essence
that recovered oil from petroleum
refinery operations, petroleum
exploration and production, and
transportation incident thereto, is
excluded from the regulatory definition
of solid waste if it is subsequently
inserted into the petroleum refining
process prior to crude distillation or
catalytic cracking. The recovered oil
thus need not be generated at the site of
the refining process—a potentially
significant expansion of the proposal.
This exclusion applies, however, only if
the oil is not managed in land disposal
units or accumulated speculatively
before it is inserted.
EPA expects that most of the
recovered oil affected by this rule will
be generated from wastewateir treatment
operations. As explained below, EPA is
as also involving recycling, the
operations involve discarded residuals
that can be part of the waste disposal
problem, and hence the wastewater
treatment operations need not be
characterized as part of an "ongoing
production process" for purposes of
excluding materials from the definition
of solid waste. Once oil is recovered,
however, the Agency believes it
reasonable to exclude it from the
definition of solid waste if the oil is to
be reused in the refining process (even
though the oil may still require a
significant amount of further processing
before it can actually be so reused). This
is because the recovered oil and its
management within refining operations
can be viewed as part of the petroleum
refining process and not part of the
waste disposal problem.
EPA is also slightly amending the
regulatory exemption for petroleum
coke produced using oil-bearing refinery
hazardous waste (see § 261.6 (a)(3)(vii),
redesignated (a)(3)(vi) in today's rule).
The Agency is slightly broadening the
current exemption so that it also applies
to coke produced by a single petroleum
refining entity, but the coker is located
at a different facility from where the
hazardous wastes are generated.
As a matter of drafting, the principal
change brought about by today's rule
takes the form of an exclusion from the
regulatory definition of solid waste.
Specifically, paragraph (12) is being
added to the list of exclusions in § 261.4
(a). In addition, EPA is removing the
regulatory exemption in § 261.6(a)(3)(v)
which is superseded by today's
exclusion, and redesignating the
remaining exemptions in § 261.6(a)(3)
(vi) and (vii) as § 261.6(a)(3) (v) and (vi),
respectively, in order to maintain
consecutive numbering. EPA is also
revising two other regulatory
exemptions in § 261.6(a)(3). Finally,
EPA is making conforming changes to
§§ 261.3(c)(2)(ii)(B) and 266.100(b)(3),
both as a result of today's rulemaking,
and to reflect conforming changes that
EPA inadvertently omitted during
promulgation of die used oil final rule
(57 FR 41566 (September 10,1992)).
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Federal Register / Vol. 59, No, 144 / Thursday, July 28, 1994 / Rules and Regulations 38539
IV. Scope of Today's Final Rule
A. Limiting Scope to Recovered Oil
From Petroleum Refining, Exploration
and Production
As noted above, today's rule excludes
recovered oil generated from petroleum
exploration, production and refining
activities, and from the transportation
incident thereto, from being a solid
waste when the recovered oil is inserted
into a designated point in a petroleum
refining process. This section of the
preamble discusses why EPA is craning
the exclusion in this manner. More
specifically, we discuss why the
exclusion does not cover oil recovered
in operations downstream from
petroleum refining, and why the
exclusion does not apply to recovered
oil from industries other than petroleum
refining, exploration, or production.
EPA Is not excluding recovered oil
from operations downstream of refining,
such as marketing or retail sales,
because such oil is already excluded
from regulation (so long as it is not
disposed of). Under existing section
261.33, unused commercial chemical
products that are recycled in most
manners are not solid wastes when they
are recycled. This principle applies to
unused fuels that are recycled by being
returned to fuel-production processes.
(See also RCRA section 3004 (q)(l),
establishing a similar principle.) Thus,
for example, if a bulk oil storage
terminal has a spill of product and is
able to capture the spill and return it to
a refinery or other legitimate fuel
production operation, the spilled
product is not a solid waste. (As noted
at 55 FR 22671 (June 1,1990) however,
mere assertion of an intent to recycle a
commercial product spill does not
convert the spill into a non-waste. There
must be objective indicia that recycling
is reasonable, and that it will occur in
a timely manner.)
For different reasons, EPA is not
extending the exclusion to recovered oil
from non-petroleum industries. First,
such an exclusion is beyond the scope
of the proposed rule. It is also beyond
the scope of the judicial decisions
construing the definition of solid waste.
These decisions indicate that when one
industry sends its residual materials to
another industry for recycling, the
initial industry can be considered to
have discarded them. APIv. EPA, 906
F. 2d at 741-42; Hco v. EPA, 996 F. 2d
1126 (llth dr. 1993). EPA is also
concerned that when recovered oil
originates with non-petroleum
industries, the likelihood increases that
the oil can be contaminated with toxic
constituents that would not normally be
found in petroleum industry recovered
oil. See generally, 56 FR at 48009 (Sept.
23,1991); and see, e.g., EPA's
Development Document for effluent
guidelines for the iron and steel
industry (skimmed oil from iron and
steel industry contains contaminants
not found in petroleum recovered oil)^6
Such oily material consequently is more
likely to differ from the feedstocks
customarily processed by refineries and
thus need not be viewed as part of that
process, and may also pose risks that
can be viewed as part of the waste
disposal problem. Finally, the Agency is
studying this issue under the aegis of
the Solid Waste Definition Task Forge
and is not at a point where it is in a
position to make a final determination.7
B. Rationale for Excluding Recovered
Oil and Not Wastewater from Being a
Solid Waste
EPA is also determining today that the
oil that is skimmed from plant
wastewaters during wastewater
treatment (normally during the initial
oil/water/solids separation step
occurring during primary wastewater
treatment), as well as oil recovered from
other sources, is not a solid waste if it
is going to be inserted into the refining
process prior to the point in the process
where crude distillation or catalytic
cracking occurs. Thus, the recovered oil
systems themselves would not be waste
management units. (These units may,
however, contain hazardous wastes,
such as K049, which become subject to
regulation when removed from such
units. See 40 CFR 261.4 (c), which says
that hazardous waste regulation does
not begin for (among other things)
hazardous waste which is generated in
an associated non-waste-treatment-
manufacturing unit until the waste is
removed from the unit.)
The petroleum industry argued in its
public comments to the January 8,1988
proposal that plant wastewaters
containing oil are not solid wastes
either. Rather, they characterize the
primary wastewater treatment
operations in which oil is skimmed
6 Volumes I-V of Development Document for
Effluent Limitations Guidelines and Standards for
the Iron and Steel Manufacturing Point Source
Category, U.S. EPA, May 1982, National Technical
Information Service *PB82-240-425, -433, -458,
-466, and -474. See specifically Volume ffl, pp.
395-398; Volume IV, pp. 107-129; Volume V, p.
227.
7 EPA also notes that when Congress created
certain exemptions (not exclusions) from hazardous
waste fuel labelling requirements to accommodate
certain petroleum industry practices involving
recovered oil, it limited the scope of those
exemptions to fuels produced from oily materials
"resulting from normal petroleum refining,
production and transportation practices", RCRA
section 3004 (r)(3). This is similar to the scope of
today's rule.
from plant waters as still being part of
the refining process. Thus, the argument
goes, any step at a refinery that involves
some recovery of oil for further use is;
still part of the ongoing refining process
and cannot involve solid waste under
the holding of AMC I.
EPA disagrees with respect to primary
wastewater treatment operations. These
operations do not involve secondary
materials that are "recycled and reused
in an ongoing manufacturing or
industrial process", AMC 1,824 F, 2d at
1186 (emphasis original); see also AMC
II, 907 F. 2d at 1186lAMCI concerns
only "materials that are 'destined for ;
immediate reuse in another phase of the
industry's ongoing production ; "
process'") (emphasis original). Primary
wastewater treatment operations exist to
treat plant wastewater, The percentage
of oil in plant wastewaters that form the
influent to primary wastewater :
treatment is minuscule, on the order of
.0001 % to .000001 % (i.e. from 1 to 100
parts per million oil)^ See Tables in
Section V, Development Document for
Effluent Limitations Guidelines, New
Source Performance Standards and
Pretreatment Standards for the
Petroleum Refining Point Source
Category While some oil may be
recovered from this wastewater (an
activity the Agency certainly
encourages, and indeed requires to
prevent the oil's discharge to surface
waters and POTWs), the amounts are
hot significant in the context of a
refinery's overall production activities.
Clearly, wastewater treatment is the
main purpose of the systems in
question, and any oil recovery is of
secondary import.
Refinery wastewater is not a
"secondary material immediately reused
within an industrial process". Chemical
Waste Management v. EPA, 976 F. 2d at
14. Primary wastewater treatment is the
first step in the wastewater treatment
process that purifies the discarded
wastewaters from the refining process so
that those discarded waters can
ultimately be discharged to navigable
waters pursuant to Clean Water Act
requirements. That a small amount of
oil is removed from these wastewaters
in the course of treatment does not make
wastewater treatment a petroleum
refining operation. Put another way, the
fact that a small amount of oil may be
recovered from large volumes of the
discarded plant wastewaters does not
require EPA to consider those
operations to involve non-discarded
materials, and hence to exclude all of
the materials going to primary
wastewater treatment operations from
the definition of solid waste. AMC II,
907 F.2d at 1186-7 ("discarded" is an
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3854O Federal Register / Vol. 59, No. 144 / Thursday, July 28, 1994 / Rules and Regulations ^^
indeed repeatedly referred to these
treatment standards as the core of
RCRA's hazardous waste management
scheme. Id. at 23,24.
EPA's interpretation that the influent
into primary wastewater treatment
consists of discarded wastes, not in-
process petroleum, is fully in accord
with these core principles of RCRA.
Decharacterized wastewaters that are
going to be managed in surface
impoundments would nevertheless
receive Section 3004 (m) treatment
before their ultimate discharge, as
required by the Chemical Waste
Management opinion. Under industry's
preferred reading, however, the
decharacterized wastewaters would not
be solid wastes at all until all oil
recovery has been completed, even if
held in impoundments. At that point,
the wastewaters would no longer exhibit
a characteristic (because they have been
diluted through aggregation), and thus
would not be prohibited wastes subject
to Section 3004 (m) treatment. The
"core principles of RCRA" would thus
be avoided. EPA considers its
interpretation of "discarded," that
assures proper treatment of
characteristically hazardous petroleum
refinery wastewaters that are going to be
managed in surface impoundments, to
be more reasonable.12
EPA acknowledges that it initially
proposed to exclude all such
•wastewaters from the definition of solid
waste. 53 FR 525-526. However, the
Agency's reasoning was based in part on
the same mistaken view of the scope of
AMCI that was later rejected by the API
court. 906 F. 2d at 740-41. (EPA even
relied in part on the overbroad
"indigenous" concept, 53 FR 525, 526,
that was remanded in API. 906 F. 2d at
739, 742.) The Agency is obviously not
bound by its proposal, and subsequent
case law makes clear that the Agency
has more interpretive discretion than it
imagined in 1988. The interpretation
adopted in today's rule is reasonable
and in accord with statutory goals and
purposes.
Nor is today's action inconsistent
with AMCI's statements regarding the
scope of petroleum refining activities
that are outside the scope of Subtitle C.
That opinion indicated that in
ambiguous term that EPA may interpret
in a reasonable manner, and EPA's
interpretation that recoverable materials
managed in wastewater treatment
operations containing surface
impoundments were discarded solid
wastes was reasonable).
On the other hand, recovered oil
systems can be legitimately viewed as
part of the petroleum refining process.
The input to the recovered oil systems
is primarily oil skimmed from
wastewater treatment operations as well
as oil recovered from other sources, not
discarded refining process wastewaters.
Recovered oil systems do not exist to
remove contaminants from wastewater.
Rather, their purpose is to restore
recovered oil to sufficient purity so that
it can be reused as a feedstock material
in the refining process. This is a natural
point to characterize activities as being
part of the refining process.
It is thus EPA's view that until oil is
recovered from refinery process
wastewaters, the wastewaters are
discarded materials and hence solid
wastes potentially subject to regulation
under RCRA.8 (Wastewaters remaining
after oil has been recovered are still
solid wastes, and are typically returned
to an upstream point in the refinery's
wastewater treatment system.) The oil
recovered from such wastewaters is not
a solid waste, however (assuming it is
reinserted into the refining process).
This reading is not only in accord with
common sense, as explained above, but
also is in accord with RCRA's goals and
purposes. AMC II, 907 F. 2d at 1186-87;
API, 906 F. 2d at 740-41. As these cases
make clear, EPA may ordinarily
consider secondary materials that have
"become part of the waste disposal
problem" to be discarded. API, 906 F.
2d at 741; AMC II, 907 F. 2d at 1186.
That is the case here. Discarded plant
wastewaters up to and including the
primary wastewater treatment step, can
contain high loadings of hazardous
constituents that may pose
environmental harm if released. It is
estimated that an average of 34% of the
"On a similar note, the Agency is aware of
activities at petroleum management facilities where
free-phase hydrocarbon (from spills, etc.) is
removed from the water table as part of
groundwater remediation (see 56 FR at 13406 (Apr.
2,1991)). These hydrocarbon recovery operations
can recover materials ranging from mostly water to
mostly oil; only recovered materials that are
primarily oil, and that can be inserted into a
refinery's recovered oil system without
pretreatment (or can be inserted directly into the
refining process itself), would be considered
"recovered oil" eligible for today's exclusion. The
management of petroleum-contaminated
groundwater in separation and treatment units is
clearly solid waste (and potentially hazardous
waste) management, essentially wastewater
treatment.
benzene (a human carcinogen]' entering
a petroleum refinery's wastewater
treatment system is emitted to air from
the wastewater collection portion of the
system; when primary wastewater
treatment (i.e., a non-enclosed oil-water
separator) is included in this
calculation, the amount of benzene
emitted relative to the influent
concentration rises to 47%.9 Primary
wastewater treatment also is sometimes
conducted in land-based or in-ground
units, which can (and have) resulted in
environmental contamination,10 This
further indicates that these operations
can be part of the waste management
problem.
In addition, petroleum refineries
frequently generate individual
wastewater streams that exhibit
characteristics of hazardous waste,
which streams are mixed together so
that the characteristic is removed. (The
characteristic can be removed either
before or during primary treatment.)
These aggregated wastewater streams
may still contain high volumes of
hazardous constituents, however,
because aggregation (i.e. dilution) and
primary treatment do not significantly
remove or destroy all hazardous
constituents. See Tables in Section V,
Development Document for Effluent
Limitations Guidelines, New Source
Performance Standards and
Pretreatment Standards for the
Petroleum Refining Point Source
Category. The aggregated wastewaters
are then managed in surface
impoundments, where biological
treatment occurs. The B.C. Circuit has
made clear, in Chemical Waste
Management v. EPA, that in such
circumstances the decharacterized
wastewaters cannot be managed in
surface impoundments unless they have
first been treated to meet the treatment
requirements of RCRA Section 3004(m)
(requiring treatment that substantially
removes or destroys hazardous
constituents so that threats to human
health and the environment are
minimized), or unless treatment
equivalent to Section 3004(m) treatment
occurs before the wastewatens are
discharged. Id. at 7, 20-24." The court
9 The Agency addressed benzene emissions from
waste operations in a final rule published January
7,1993 (58 FR 3072) using risk-based standards for
benzene. See also EPA, Final NESHAP Standards
for Waste Operations: Basis for Impact
Calculations, February 16,1990. This document is
available in the Benzene Waste Operations
NESHAP docket.
10 "Background Document to Support Listing of
Primary Oil/Water Separation Sludges from the
Petroleum Refining Industry," U.S. EPA, December
22,1989, pp. 6,10-12.
1' EPA is still working to interpret the scope of
the "equivalence" requirement in the Chemical
Waste Management opinion, and the language in
the text should not be taken as representing the
Agency's resolution of the issue. It is clear,
however, that the opinion imposes obligations on
facilities that use impoundments to manage
wastewaters that are decharacterized by means
other than full-scale section 3004 (m) treatment.
12 EPA views the facts here as similar to those in
the AMC II case. In particular, both situations
involve wastewater treatment operations, where
plant wastewaters could ultimately be managed in
surface impoundments.
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Federal Register / Vol. 59, No. 144 / Thursday, July 28, 1994 /Rules and Regulations 38541
as"(a)ny
hydrocarbons thafare not usable in a
particular form or state are returned to
an appropriate stage in the refining
process so they can eventually be used.
Likewise, the hydrocarbons and
materials which escape from a refinery's
production vessels are gathered and, by
a complex retrieval system, returned to
appropriate parts of the refining
process." 824 F. 2d at 1181. Today's
rule does not assert RCRA jurisdiction
over any refining operations that
process hydrocarbons into products, nor
over hydrocarbons that are lost from
process vessels and are gathered for
return to refining. Rather, the Agency is
stating that up to and including primary
wastewater treatment, plant wastewaters
are just that, and their management is
potentially subject to Subtitle C
controls. Oil that is recovered from
wastewater, however, is no longer a
solid waste, and recovered oil systems
that do engage in retrieval of
hydrocarbons for eventual refining are
not subject to RGRA controls.'3
C. Rationale for Excluding Recovered
Oil From Off-Site Sources
Today's final rule, in defining the
scope of recovered oil subject to the
exclusion, excludes recovered oil from
both off-site and cm-site sources. EPA
believes that recovered oil from
petroleum refining, exploration and
production, and transportation incident
thereto, whether generated from these
off-site or on-site sources, is essentially
the same raw material (Le., "oil") as that
which is normally and routinely
transported to, and inserted into,
petroleum refining processes. Therefore,
recovered oil from off-site sources
should also be excluded when it is
going to be recycled in this manner.14
13The Agency also views its action as consistent
with its nilemaking involving residues from coke
by-product operations that are returned to the
coking process, or related processes. 57 FR 27880
(June 22,1992}. The Agency slated that such
materials were not solid wastes provided they were
not land disposed before reinsertion. See 40 CFR
2G1.4(aHlO). However, unlike the petroleum
wastewaters containing small amounts of oil at
issue here, the coke byproduct residues were found
to be very similar to the raw material being
replaced, and required no further purification to be
usable. They could be inserted more or less directly
tato the coking or related tar-refining processes.
Such residues are conceptually analogous to the
purified oil coming from a petroleum slop oil
facility.
"Certain wastes from petroleum exploration,
development and production are currently exempt
from Subtitle C regulation under § 261.4(b)(5).
There may be a degree of overlap between the
materials excluded by today's action, and materials
currently exempt under §261.4(b)(5). See 53 FR at
25446 (July 6,1988), 58 FR 15284 (Mar. 22,1993),
and Report to Congress, Management of Wastes
from the Exploration, Development, and Production
of Crude Oil, Natural Gas, and Geothermal Energy,
Examples of off-site sources of
recovered oil include oil recovered from
other petroleum refineries, and from oil
and gas drilling operations.15
This exclusion is somewhat broader
than that proposed in the January 8,
1988 notice, which would have limited
the exclusion to materials generated on-
site. 53 FR 525. However, the 1988
proposal would not have been limited to
recovered oil, but rather would have
included all oil-bearing secondary
materials, so that the Agency was
particularly concerned with limiting the
exclusion's scope because such
materials as listed sludges, tank bottoms
and contaminated media could be
excluded. Id. In addition, if the
exclusion was to cover oil-bearing
hazardous secondary materials, EPA
was concerned that RCRA Section
3004{r)(2) would be rendered
meaningless. Id. These concerns are no
longer present when the exclusion is
limited to recovered oil.
The main reason for extending the
exclusion to recovered oil generated at
locations other than a refinery {when
such oil is ultimately returned to a
refinery) is that the oil is essentially the
same (in terms of physical composition
and potential risk) as recovered oil
generated on-site. (The only significant
difference is that recovered oil
generated off-site is transported—in the
same manner as crude oil. EPA does not
regard this distinction as significant
enough to warrant different regulatory
status for off-site recovered oil.) The
Agency thus is responding to comments
received from industry, urging the
Agency to extend the scope of the
exclusion to certain off-site activities.
However, these commenters argued
further that refineries comprise but one
segment of a large, integrated industry,
extending from the production field,
through the pipeline, to the refinery, to
the marketing terminal, to tank trucks,
and, ultimately, to the customer. EPA
does not necessarily accept this
argument, which is unnecessary to
justify today's rule. Again, EPA will
continue its broader policy review of the
Definition of Solid Waste. EPA notes as
Volumes 1-3 and Executive Summaries, December
1987, EPA/530-SW-88-003, for descriptions and
clarifications of exempt and non-exempt wastes
from oil and gas exploration, development, and
production.
15 As noted above, recovered oil does not include
"used oil" (as defined in 40 CFR 279.1) brought to
a refinery from off-site sources. (De minimis
quantities of used oil that are incidentally captured
by refinery wastewaler treatment systems and
subsequently recovered with other oil are not
considered used oil.) See 57 FR 41566 (September
10,1992) and 59 FR 1994 (March 4,1994) for
discussion on the scope of the definition of used
oil. See also Section X.C.2 "Used Oil" later in this
preamble.
well that the action in today's rule is not
precedential for other industries.
Determining what activities are a part of
on-going production activities and not
part of the waste disposal problem
necessarily entails fact-specific ;
evaluation. The Agency's conclusions
regarding secondary materials generated
by particular industries thus need not be
germane to the regulatory status of
secondary materials generated by other
industries,
V. Rationale for Conditioning the
Exclusion on Recovered Oil Not Being
Placed on the Land and Not Being
Accumulated Sjpeculatively
This rule does not exclude land-based
hazardous waste management units
from which oil maybe recovered. Thus,
if recovered oil, or material containing
oil, is placed in land-based units such
as surface impoundments or land
treatment units, those units remain
subject to Subtitle C requirements
(provided the material being placed is
hazardous under RCRA). The Agency
considers material placed in such units
to be discarded, and hence solid wastes.
See also AMCI, 824 F. 2d at n.20. These
are classic disposal practices (see RCRA
Section 1002(b)(7)), and placement of
oily materials in such units (whether for
storage, treatment, or disposal) is
inconsistent with the use of the material
as a valued product. In addition, the
D.C. Circuit held in AMC H that
materials destined for recycling were
still solid wastes if held in surface
impoundments before being recycled
(907 F. 2d at 1186).
The final condition for the exclusion
to apply is that recovered oil not be
accumulated speculatively (as defined
in § 261.1(c)(8)) before it is recycled
back into a petroleum refining process.
This is a standard condition that the
Agency applies to otherwise excluded
secondary materials (see, e.g.,
§ 261.2(e)(2)(iiil to prevent the
materials being held for prolonged
periods without being recycled, with i
attendant increased environmental risk.
See 50 FR at 634-635,658-661 (Jan. 4,
1985), No commenter seriously
questioned applying this condition, :
Thus, recovered oil that would
otherwise be excluded that is
accumulated speculatively is considered
to be discarded and hence a solid waste.
VI. Rationale for Not Excluding
Recovered Oil That Is Inserted Into the
Petroleum Refining Process After Crude
Distillation or Catalytic Cracking (i.e.,
Into a Petroleum Coker)
Today's final rule is narrower in
scope than the January 8,1988 notice:iii
that the Agency is not finalizing the
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38542 Federal Register / Vol. 59, No. 144 / Thursday, July 28, 1994 / Rules and Regulations
proposed exclusion of recovered oil that
is converted to petroleum coke. EPA is
deferring the exclusion at this time
because EPA lacks data assuring that
hazardous constituents from petroleum
refining do not end up in the product in
quantities that, when such product is
utilized as a fuel, could be harmful to
human health and the environment.
EPA is also concerned that toxic
constituents, such as heavy metals, can
be discarded by simple incorporation
into the coke product. In effect, the
product would be used as a disposal
medium for toxic constituents, and so
could be part of the "waste disposal
problem." The Agency also lacks
sufficient data to show whether oil
recovered from refinery wastewater
treatment systems contains toxic metals
that are not present in the normal feed
to a petroleum coker. Such metals could
end up in the coke product.
In contrast, the Agency is excluding
recovered oil inserted at or before a
point in the refining process designed to
remove toxic metal and organic
contaminants, i.e., prior to crude
distillation or catalytic cracking. See 50
FR 28725 (July 15,1985) and 50 FR
49169 (November 29,1985). As
explained there, the distillation process
splits the feedstock into fractions based
on the differing boiling points of
feedstock components. Data submitted
by API at that time indicated that most
metals concentrate in the heavier
petroleum fractions, thereby increasing
the probability of contaminant removal
from many fuel fractions produced
using distillation (and other
contaminant-removing processes). See
50 FR 49170.
Although the proposed exclusion of
recovered oil that is converted to
petroleum coke is not being finalized in
today's rule, for different reasons EPA is
slightly amending the regulatory
exemption at § 261.6(a)(3)(vii)
(redesignated §261.6(a)(3)(vi) in today's
rule) for petroleum coke produced using
oil-bearing refinery hazardous waste.
The exemption states that such coke is
subject to regulation only if it exhibits
a characteristic of hazardous waste. (The
exemption recites the provisions of
RCRA section 3004(q)(2)(A).) The
purpose of the statute, and the
exemption, is to allow petroleum
companies to recycle their oily refinery
waste to then1 petroleum coker, without
automatically subjecting the coke output
to the rules applicable to hazardous
waste fuels. (Such automatic effect
could occur without the exemption, if
listed wastes are being reinserted into
the coker, because of the derived-from
rule.) S. Rept. No. 298,98th Cong. 1st
Sess. 39 (1983).
Both the statutory and current
regulatory exemption, however, are
worded so as to apply only to situations
where petroleum coke is produced from
hazardous wastes "at the same facility at
which such wastes were generated
* * *". EPA believes that this
limitation is unnecessarily narrow, and
does not foreclose a regulatory
expansion. In particular, so long as a
petroleum refinery is coking its own
wastes, it should not matter whether the
coker is located at the site where wastes
are generated or at a different facility.
Since the generator and coker operator
remain the same entity (or "person", as
defined in § 260.10) there is sufficient
guarantee that hazardous wastes of
unknown or uncertain composition will
not be used in the coking process,
which is the evident concern behind the
limitation in the statute. Cf. 50 FR at
28725 (July 15,1985); 50 FR 49170
(Nov. 29,1985). Since the hazardous
wastes would remain regulated under
RCRA when they are generated,
transported, and stored prior to
recycling, id., potential concerns
regarding tracking are also addressed.
EPA also sees no difference in the
composition of coke produced partially
from on-site and off-site hazardous
wastes when the coke is produced by
the same entity. Consequently, the
Agency is slightly broadening the
current regulatory exemption so that it
applies to coke produced by a single
petroleum refining entity, even if the
coker is located at a different facility
from where the hazardous wastes are
generated.
Finally, the coking process itself
continues to be exempt from RCRA
regulation as a recycling unit, provided
this recycling is legitimate. Section
261.6(c)(l) ("The recycling process itself
is exempt from regulation except as
provided in § 261.6(d)."). Today's rule
does not affect this provision.
Vn. Rationale for Not Excluding Other
Oil-Bearing Hazardous Materials
Just as EPA is not excluding oil-
bearing wastewaters from thei definition
of solid waste, it is not excluding other
similar types of oil-bearing materials,
such as hazardous wastewater treatment
sludges. These materials are not
composed primarily of oil; they are
unlike raw materials normally used in
the petroleum refining process; and the
units in which they are managed—API
separators, DAF units, land treatment
units and surface impoundments—are
not parts of the refining process, but
rather function as waste holding and
treatment units. In addition, there have
been many damage incidents associated
with management of such materials as
toxic sludges from wastewater
treatment, confirming that these
materials are part of the waste disposal
problem, rather than part of an on-going
manufacturing operation. (See, for
example, the Listing Background
Documents for Hazardous Wastes K048-
052 and F037-Q38.) For these reasons,
the Agency continues to classify these
materials as discarded, within the
meaning of RCRA Section 1004 (27).
Recovered oil that is obtained from such
wastes, however, is excluded from the
definition of solid waste under today's
final rule (assuming the rule's
conditions are satisfied).
The Agency is also aware of various
types of units designed to treat wastes
K048-K052 and F037-F038, in order to
reduce the volume and toxicity of these
wastes, as well as to recover oil. See,
e.g., 57 FR 37198 (August 18, 1992).
EPA does not view these units as part
of the manufacturing (i.e., refining)
process, because such units are not part
of a continuing series of unit operations
that crack/distill/fractionate crude oil.
The input to these units are materials
such as wastewater treatment sludges,
that contain relatively small amounts of
oil. A different determination frustrates
the Congressional objective that
hazardous waste be treated properly.
These types of units are the basis for
treatment standards under the land
disposal restrictions for K048-K052 and
F037-F038. If the sludges treated in
these units are no longer hazardous
waste, they would not need to be treated
by application of BOAT so as to
minimize the threats they pose. Cf. API,
906 F. 2d at 741-742. Thus, excluding
such sludges from jurisdiction until
properly treated could contribute to the
waste disposal problem that Congress
sought to remedy. Finally, although EPA
is not excluding these types of oil-
bearing materials (such as hazardous
wastewater treatment sludges), the units
in which the recovery of oil is occurring
may still be a type of recycling unit, and
therefore may be exempt from RCRA
permitting requirements under 40 CFR
. Demonstration That Recovered Oil
Meets Conditions of Exclusion
Under § 261.2(f), persons claiming
that recovered oil is excluded from the
definition of solid waste bear the burden
of proof in enforcement actions to
demonstrate that they qualify for the
exclusion. This would normally require
some type of demonstration that the
recovered oil is going to be and actually
is used in a petroleum refining
operation prior to crude distillation or
catalytic cracking. For on-site sources,
this documentation could be entries in
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Federal Register / Vol. 59, No. 144 / Thursday, July 28, 1994 / Rules and Regulations 38543
the operating records of the facility
showing where the oil is recovered and
where it re-enters the refining process.
For off-site sources, this demonstration
is especially important. Adequate
documentation could entail bonafide
contractual agreements with other
facilities to take the recovered oil,
shipping or delivery records to the
receiving facility, or other similar
records. These records are important to
show enforcement personnel that the
conditions of the exclusion have been
met. Without this documentation, the
burden of proof will ordinarily not be
satisfied because enforcement personnel
will have no way of verifying that the
recovered oil actually was used in the
refining process and the assumption can
be made that the oil was not reused, and
was instead sent off-site or managed on-
site as a hazardous waste.
EC. Examples of How Today's Rule
Operates
Example 1
Petroleum refinery A generates wastewater.
As part of primary wastewater treatment, it
skims oil from the wastewater. This
operation occurs in wastewater treatment
tanks. The skimmed oil is then gathered and
inserted directly into crude oil storage units
for insertion into the refining process.
The refinery process wastewater is still
considered to be a solid waste,
notwithstanding that some oil is skimmed
from it The wastewater treatment tanks used
for treating the wastewater are exempt from
subtitle C regulation. Section 264.1(g)(6),
265.1 (c)(10). The skimmed oil is recovered
oil that is excluded from being a solid waste
under today's regulation because it originates
front petroleum refining, it is not land
disposed before being recycled, and it is
returned to the designated part of the
petroleum refining process. (This answer
assumes that the recovered oil is not being
accumulated speculative!}-.}
Example 2
Same facts as Example 1, except that the
skimmed oil requires processing in the
plant's slop oil system. This process involves
demulsifying and separation via chemical
addition, thermal treatment, and gravity
separation.
Same answer as in Example 1. It should
also be noted that water and solids from the
slop oil system can be wastes, and if
hazardous, can be subject to Subtitle C
regulation once they are removed from the
slop oil tank.
Example 3
Same facts as Example 1, except that the
source of the recovered oil is a petrochemical
plant wastewater treatment system.
The oil is not excluded from being a solid
waste under today's rule because it does not
come from petroleum refining, exploration or
production operations.
Example 4
Facility B recovers oil from spills at
exploration and production operations. The
oil is trucked to a tank, where separation
occurs. The separated oil is put into a
pipeline for ultimate insertion into crude oil
storage units at a petroleum refinery.
The oil recovered from the spills is
excluded from being a solid waste. It is a type
of recovered oil, and is excluded because it
originates from exploration and production
activities, is not land disposed or
accumulated speculatively, and is inserted
into a refining process. " :
Example 5
Facility C is a bulk petroleum storage
facility. Oil spilled from its product storage
tanks is too contaminated to be directly used
as product. The oil is sent back to a refinery
where it is placed in a slop oil system and
returned to the refining process.
The spilled oil is excluded from being a
solid waste, not under today's rule, but under
§ 261.33 (and § 261.2 Table 1) because it is
a commercial chemical product that is being
recycled rather than abandoned, (EPA
interprets this principle to apply to
commercial chemical products that exhibit
characteristics as well as those listed in
§261.33. 50 FR14219 (April 11,1995).) (This
answer assumes that the oil is recovered
promptly and that the spills do not create
permanent land disposal units. See 55 FR
22671 (June 1,1990),)
All of these ansxvers assume that legitimate
recycling is occurring. See discussion of
sham recycling criteria in many prior Agency
notices, such as 53 FR 522 (Jan. 8,1988) and
56 FR 7143,7185 (Feb. 21,1991).
X. Relationship to Other Programs
A. Clean Air Act (Benzene NESHAP)
On January 7,1993 (58 FR 3072) EPA
promulgated under Section 112 of the
Clean Air Act (42 U.S.C. 7412) final
amendments to the benzene waste
operations national emission standards
for hazardous air pollutants (NESHAP)
(V FF at 40 CFR part 61). Sources
affected by V FF include chemical
manufacturing plants, by-product
recovery plants, petroleum refineries,
and facilities at which waste
management units are used to treat,
store, or dispose of waste generated by
chemical manufacturing plants, by-
product recovery plants, or petroleum
refineries.
B. Clean Water Act
Today's rule does not affect petroleum
facilities'obligations under the Clean
Water Act, and is consistent with the
Agency's prior descriptions of primary
wastewater treatment activities at
petroleum refineries as involving
wastewater treatment, not recycling of
in-process material.
C. RCRA
1. RCRA Air Emission Standards
EPA has issued regulations that
implement portions of RCRA Section
3004(n), which provision requires EPA
to issue rules regulating air emissions
resulting from facilities that treat, store,
or dispose of hazardous wastes. 40 CFR
parts 264 and 265 Subparts AA and BB.
These rules control organic emissions
from vents and equipment leaks from
units managing hazardous wastes,
which units either are already subject to
RCRA Subtitle C permitting
requirements, or are recycling units
located at facilities which has other
units already subject to Subtitle C
permitting requirements.
Today's rule does not affect any units
that are subject to regulation under
subparts AA or BB. This is because the
units that are affected by today's rule are
not presently subject to Subtitle C
regulation, either because they are
wastewater treatment tanks exempt from
regulation under §§ 264.1(g)(6) and
265.1(c){10), because they are recycling
units not covered by the Subpart AA or
BB regulations (i.e., are not "distillation,
fractionation, thin-film evaporation,
solvent extraction, or air or steam
stripping operation", see §§264.103Q(h),
264,1050(b), 265.1030(b), and
265,l;050(b)) and otherwise exempt from
regulation under §261.6(c)(l), or
because they manage materials exempt
from regulation, under § 261.6(a)(3) (iv),
(v) and (vi).
2. Used Oil
Today's rule does not affect petroleum
facilities' obligations under the Used Oil
Rule. See generally, 57 FR 41566
(September 1Q, 1992) and 59 FR 1994
(March 4,1994|. Today's rule excludes
from RCRA Subtitle C requirements
only recovered oil as described.
Whether or not recovered oil excluded
under today's rule is subject to the used
oil management standards depends on
whether or not the recovered oil does or
does not also meet the definition of used
oil. Id, The Agency recently issued a
final used oil rule on March 4,1994 (see
59 FR 10550) which affects the
definition of used oil and deals with
issues similar to those in today's rule.
According to this final used oil rule, de
minimis quantities of used oil that are
incidentally captured fay a refinery's
wastewater treatment system and
subsequently recovered along with other
oil hi a refinery's recovered oil system
are not regulated as used oil. 59 FR
10550 (March 4,1994).
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38544 Federal Register / Vol. 59, No. 144 / Thursday, July 28, 1994 / Rules and Regulations
D. Enforcement; Effect of Today's Final
Rule on RCRA 3007,3013, 7002 and
7003 Authorities
EPA's action today affects only the
final regulatory definition of solid
waste. It does not interpret the scope of
the term "solid waste" for purposes of
the non-regulatory authorities in RCRA
Sections 3007, 3013, 7002 and 7003. See
40 CFR § 261.1(b). Thus, for purposes of
those authorities, the Agency (or
citizens in the case of citizen suits
under Section 7002(a)(l)(B)) would have
the benefit of the full jurisdictional
reach of the statutory definition of solid
waste. See Comite Pro Rescate de la
Salud v. Puerto Rico Aqueduct and
Sewer Authority, 888 F. 2d 180,185 (1st
Cir. 1989), cert, denied, 494 U.S. 1029
(1990) (upholding reasonableness of
applying narrower definition for
regulatory purposes than for purposes of
imminent and substantial endangerment
authority); Connecticut Coastal
Fishermen's Association v. Remington
Arms Company, 989 F. 2d 1305 (2d Cir.
1993) (noting potential appropriateness
of applying narrower regulatory
definition of solid waste for determining
scope of Subtitle C regulation, but
applying broader statutory definition in
non-regulatory contexts such as RCRA
Sections 7002 and 7003).
XI. State Authority
A. Applicability of Rules in Authorized
States
Under Section 3006 of RCRA, EPA
may authorize qualified States to
administer and enforce the RCRA
program within the State. (See 40 CFR
Part 271 for the standards and
requirements for authorization.)
Following authorization, authorized
States have primary enforcement
responsibility, although EPA retains
enforcement authority under Sections
3008, 7003 and 3013 of RCRA.
Prior to the Hazardous and Solid
Waste Amendments of 1984 ("HSWA"),
a State with final authorization
administered its hazardous waste
program entirely in lieu of EPA
administering the Federal program in
that State. The Federal requirements no
longer applied in the authorized State,
and EPA could not issue permits for-any
facilities in the State which the State
was authorized to permit. When new,
more stringent Federal requirements
were promulgated or enacted, the State
was obliged to enact equivalent
authority within specified time frames.
New Federal requirements did not take
effect in an authorized State until the
State adopted the requirements as State
law.
In contrast, under Section 3006(g) of
RCRA, 42 U.S.C. 6926(g), new
requirements and prohibitions imposed
by HSWA take effect in authorized
States at the same time that they take
effect in nonauthorized States. EPA is
directed to carry out those requirements
and prohibitions in authorized States,
including the issuance of permits, until
the State is granted authorization to do
so. While States must still adopt HSWA-
related provisions as State law to retain
final authorization, the HSWA applies
in authorized States in the interim.
Today's amendments are not imposed
pursuant to HSWA. The rule changes,
therefore, will become effective
immediately only in those States
without interim or final authorization,
not in authorized States. The effect of
the rule changes on authorized State
programs is discussed next.
B. Effect on Authorized State Programs
Today's rule will not be effective in
authorized States since the requirements
are not being imposed pursuant to
HSWA. Thus, the requirements will be
applicable only in those States that do
not have interim or final authorization.
Li authorized States, the requirements
will not be applicable until the State
revises its program to adopt equivalent
requirements under State laws.
40 CFR 271.21(e)(2) requires that
States that have final authorization must
modify their programs to reflect Federal
program changes and must subsequently
submit the modifications to EPA for
approval. However, it should be noted
that authorized States are only required
to modify their programs when EPA
promulgates Federal standards that are
more stringent or broader in scope than
the existing Federal standards. Section
3009 of RCRA allows States to impose
standards more stringent than those in
the Federal program. For those Federal
program changes that are less stringent
or reduce the scope of the Federal
program, States are not requiredto
modify their programs. See 40 CFR
271.1(k). Today's amendments to
§ 261.4 reduce the scope of the existing
Federal requirements. Therefore,
authorized States will not be required to
modify their programs to adopt
requirements equivalent or substantially
equivalent to the provisions proposed
today.
However, as noted above, States are
required by § 271.21 to revise their
programs to reflect Federal program
changes. 51FR 33722 (September 22,
1986). A number of States qualified for
final authorization prior to being
required to adopt the redefinition of
solid waste rulemaking of January 4,
1985 (5Q.FR 614). Since the January 4,
1985 rule is more stringent than the rule
under which such States were
authorized, such States were required to
revise their programs in accordance
with Part 271.21. Today's changes will
not preclude EPA's ability to authorize
States which have subsequently adopted
the January 4,1985 rule since it would
reduce the scope of the Federal
requirements. However, certain aspects
of the State's regulation will be broader
in scope than the Federal program and
therefore not part of the authorized State
program. This means that while they are
enforceable under State law, they are
not subject to Federal enforcement.
40 CFR 271.21(e) provides for
extensions of time at the discretion of
the Regional Administrator for States to
adopt changes to their regulations and/
or statutes to conform to change in the
Federal program. The question arises,
however, of whether States which have
not yet adopted the January 4 rule must
adhere to EPA's published compliance
schedules for such adoption. Where
States have delayed rulemaking pending
today's rulemaking clarifying the impact
of the court's decision, the EPA
Regional Administrators may be flexible
in further extending the modification
deadlines. EPA Regional Administrators
should take into account the States'
regulatory and/or legislative procedures
in deciding what further extensions may
be •warranted. However, any States
which have delayed rulemaking should
now proceed to expeditiously adopt the
January 4,1985 rules as amended by
today's notice.
XII. Regulatory Requirements
A. Regulatory Impact Analysis Pursuant
to Executive Order No. 12866
Under Executive Order No. 12866 [58
FR 51735 (October 4,1993)], the Agency
must determine 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, competition,
jobs, the environment, public health or
safety, or State, local, or tribal
governments or communities; (2) create
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
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Federal Register / Vol. 59, No. 144 / Thursday. July 28, 1994 / Rules and Regulations 38545
mandates, the President's priorities, or
the principles set forth in the Executive
Order.
It has been determined that this rule
is not a "significant regulatory action"
under the terms of Executive Order
12866 and is therefore not subject to
OMB review.
B. Regulatory Flexibility Act
The Regulatory Flexibility Act of 1980
(Pub. L. 96-354), requires Federal
regulatory agencies to consider the
impact of rulemaking on "small
entities." If a rulemaking will have a
significant impact on a substantial
number of small entities, agencies must
consider regulatory alternatives that
minimize economic impact.
Today's rulemaking does not have a
significant impact on any small entity.
Rather, it excludes from the definition
of solid waste certain petroleum
materials being recycled within the
petroleum industry. Accordingly, this
doregulatory action will not add any
economic burdens to any affected
entities, small or large, and a regulatory
flexibility analysis is not required.
Therefore, the Administrator certifies
pursuant to 5 U.S.C. 601 etseq., that
this rule will not have a significant
impact on a substantial number of small
entities because today's amendments
reduce the scope of the Subtitle C
regulatory program.
C. Paperwork Reduction Act
Under the Paperwork Reduction Act,
44 U.S.C. 3501 et seq., EPA must
consider the paperwork burden imposed
by any information collection request in
a proposed or final rule. This rule will
not impose any new information
collection requirements.
List of Subjects
40 CFR Part 261
Environmental protection, Hazardous
waste, Solid waste, Petroleum,
Recycling.
40 CFR Part 266
Environmental protection, Energy,
Hazardous waste, Petroleum, Recycling.
Dated: July 15,1994.
Carol M. Browner,
Administrator.
For the reasons set out in the
preamble, Chapter I of title 40 of the
Code of Federal Regulations is amended
as follows:
PART 261—IDENTIFICATION AND
LISTING OF HAZARDOUS WASTE
1. The authority citation for part 261
continues to read as follows:
Authority: 42 U.S.C. 6905,6912(a), 6921,
6922, and 6938.
2. Li § 261.3, paragraph (c)(2)(ii)(B) is
revised to read as follows:
§ 261.3 Definition of hazardous waste.
*****
(c) * * *
(2) * * *
(ii)
(B) Waste from burning any of the
materials exempted from regulation by
§261.6(a)(3) (iv) through (vi).
*****
3. A new paragraph (a)[12) is added
to §261.4 to read as follows:
§261.4 Exclusions.
*****
(a) * * *
(12) Recovered oil from petroleum
refining, exploration and production,
and from transportation incident
thereto, which is to be inserted into the
petroleum refining process (SIC Code
2911) along with normal process
streams prior to crude distillation or
catalytic cracking. This exclusion
applies to recovered oil stored or
transported prior to insertion, except
that the oil must not be stored in a
manner involving placement on the
land, and must not be accumulated
speculatively, before being so recycled.
Recovered oil is oil that has been
reclaimed from secondary materials
(such as wastewater) generated from
normal petroleum refining, exploration
and production, and transportation
practices. Recovered oil includes oil
that is recovered from refinery
wastewater collection and treatment
systems, oil recovered from oil and gas
drilling operations, and oil recovered
from wastes removed from crude oil
storage tanks. Recovered oil does not
include (among other things) oil-bearing
hazardous wastes listed in 40 CFR part
261 D (e.g., K048-K052, F037, F038).
However, oil recovered from such
wastes may be considered recovered oil.
Recovered oil also does not include
used oil as defined in 40 CFR 279.1.
4. M § 261.6, paragraph (a)(3)(v) is
removed, paragraph (a)(3)(vi) is
redesignated as (a)(3)(v), and paragraph
(aj(3)(yii) is redesignated as (a)(3)(vi).
Section 261.6 is further amended by
revising paragraphs (a)(3)(iv) and newly
redesignated (a)(3)(vi) to read as follows:
§261.$ Requirements for recyclable
materials.
*****
(a) * * *
(3) * •.*•'•
(iv) Fuels produced from the refining
of oil-bearing hazardous waste along
with normal process streams at a
petroleum refining facility if such ;
wastes result from normal petroleum
refining, production, and transportation
practices (this exemption does not apply
to fuels produced from oil recovered
from oil-bearing hazardous waste, where
such recovered oil is already excluded
under § 261.4(a]i(12);
* * * * *
(vi) Petroleum coke produced from
petroleum refinery hazardous wastes
containing oil by the same person who
generated the waste, unless the resulting
coke product exceeds one or more of the
characteristics of hazardous waste in
part 261, subpart C.
PART 266—STANDARDS FOR THE
MANAGEMENT OF SPECIFIC
HAZARDOUS WASTES AND SPECIFIC
TYPES OF HAZARDOUS WASTE
MANAGEMENT FACILITIES
5. The authority cite for part 286
continues to read as follows:
Authority: 42 U.S.C. 6905,6912(a), 6924,
and 6934.
6. Section 266,10Q(b)(3) is revised to
read as follows:
§266.100 Applicability.
*****
(b) * * *
(3) Hazardous wastes that are exempt
from regulation under §§ 261.4 and
261.6(a)(3) (iv) through (vi) of this
chapter, and hazardous wastes that are
subject to the special requirements for
conditionally exempt small quantity
generators under § 261.5 of this chapter;
and
*****
[FR Doc. 94-18452 Filed 7-27-94; 8:45 am]
BILLING) CODE 65450-60-P
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&EPA
United States
Environmental Protection Agency
(5305)
Washington, DC 20460
Official Business
Penalty for Private Use
$300
EPA-530-Z-94-009
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