DRAFT. MEMORANDUM December 17, Phillip Fielder, P.E., Permits and Engineering Group Manager. Kendal Stegmann, Senior Environmental Manager

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1 DRAFT OKLAHOMA DEPARTMENT OF ENVIRONMENTAL QUALITY AIR QUALITY DIVISION MEMORANDUM December 17, 2010 TO: THROUGH: THROUGH: THROUGH: FROM: SUBJECT: Phillip Fielder, P.E., Permits and Engineering Group Manager Kendal Stegmann, Senior Environmental Manager Phil Martin, P.E., Engineering Section Peer Review, David Pollard Herb Neumann, Regional Office at Tulsa Evaluation of Permit Application No TVR2 Baker Petrolite Corporation Synthetic Polymer Manufacturing Facility 820 Birch Lake Road, Barnsdall, Osage County SE/4 18, T24 N, R11 E ( N, W) West on OK 11 approximately one mile from its intersection with OK 123; turn left (west) on Chestnut as OK 11 bends to the north entering Barnsdall, ¼ mile to 8 th Street (Birch Lake Road), turn left (south) ¼ mile to facility. I. FACILITY DESCRIPTION This facility started operations as a petroleum refinery in By the 1950s, the facility had specialized in microcrystalline waxes and most other activities were discontinued. A production unit for the manufacture of synthetic waxes (SIC 2869) was built in 1970 and a second unit was constructed in The two production units, referred to as EP Units (for Ethylene Polywax) or just Polywax Units, are identified as Unit A for the older area and Unit B for the newer area. All microcrystalline wax manufacture was ended in The facility currently operates under Part 70 permit No TVR (M-1), issued September 6, The current request is to renew the Part 70 operating permit. Applicant requests that the Insignificant Activity list be updated, that changes in compliance dates for NESHAP FFFF be identified in the permit, and that various minor changes at the facility that have been made through notification or through applicability determination be incorporated into the operating permit. Each of these requested changes will be addressed at appropriate points in the memorandum and Specific Conditions. II. PROCESS DESCRIPTIONS The Barnsdall Plant manufactures organic chemicals in three primary production units and support operations. The three production units are Synthetic Wax Production Unit, Resin Unit, and Oxidation Unit, and they will be discussed in the order listed. Miscellaneous Sources are listed following discussion of the production units.

2 PERMIT MEMORANDUM TVR2 DRAFT 2 SYNTHETIC WAX PRODUCTION UNIT BPC manufactures low molecular weight synthetic waxes, designated as ethylene polywax (EP) products. The synthetic waxes are produced by polymerizing organic monomers, principally ethylene and propylene. EP finished products are solids at ambient temperature and have negligible volatility. Raw materials used in the EP process are organic monomers (principally ethylene and propylene), reaction initiators, reaction catalyst, and carrier solvent. With the exception of the reaction catalyst, all these raw materials are received and stored in bulk tanks. The plant operates two ethylene bulk tanks that are nominally sized at approximately 30,000 gallons capacity, and one propylene bulk tank nominally sized at 15,000 gallons capacity. The reaction initiators and carrier solvent are stored and dispensed from three separate bulk tanks. The reaction catalyst is received and dispensed from 55-gallon drums. Major processing steps employed to produce synthetic waxes follow. Polymerization Reaction The polymerization reaction is conducted in water-cooled agitated reactor vessels. In this process, the carrier solvent (toluene, the principal HAP), initiator, and catalyst are fed to the reactor, and then the monomer is added. Polymerization occurs, converting the monomer into a long-chain synthetic wax. The reaction mass is fed to a surge tank or directly to a wash tank for further processing. The facility can also route the reaction mass to an oxidization vessel to produce high molecular weight alcohols (Unilin ). These alcohols are very similar to the synthetic waxes, having negligible volatility. Hydrolysis and Aqueous Washing The reaction mass is fed to a hydrolysis and washing system. The purpose of this step is to hydrolyze the wax product and to remove the water-soluble initiator and catalyst compounds from the reaction mass. Washing consists of sequential water washes followed by phase separation, with the aqueous phase discharging to solvent recovery and the organic phase routed to polymer recovery. Polymer Recovery The organic phase discharged from the washing step is initially transferred to a flash evaporator/condenser system. This removes the majority of carrier solvent from the polymer product. A steam stripping process then removes the residual carrier solvent. Overheads from the stripping process are condensed and collected. The solvent with entrained water content mixture from both condensing systems discharges to wet solvent collection tanks. Polymer from the steam stripping unit discharges to accumulation/storage tanks where it is tested and then pumped to liquid product storage tanks or to the facility s prilling tower (see page 6), where wax beads are formed as the final product. Aqueous Phase Solvent Recovery The aqueous phase material discharged from the washing system and from the phase separation of the wet solvent is fed to a flash tank/condenser system or to a steam stripping column/condenser to remove and recover the carrier solvent. The condensers discharge to the wet solvent collection tanks. The stripped aqueous phase discharges to a solid/liquid separator

3 PERMIT MEMORANDUM TVR2 DRAFT 3 and lagoon system, and is ultimately pumped to a deep well injection system. The well is a Class 1 non-hazardous injection well permitted by the EPA. Solvent Purification/Drying The recovered carrier solvent accumulated in the wet solvent collection tanks is allowed to phase separate with the aqueous phase fed to the aqueous solvent recovery systems, and the organic phase fed to a distillation column for purification. Overheads from the distillation column are condensed and returned to the column as reflux. Water that is condensed is drawn off to the plant effluent system. Purification residuals from the distillation column are accumulated in a tank system and eventually sold to customers as Solvent 250. A side draw of the purified solvent is routed to an accumulation tank. This tank feeds a second distillation column for removal of any residual water. Solvent from this second drying column is fed to a molecular sieve bed that further reduces the water content. Dried purified solvent is then routed to another accumulation tank that recycles the solvent back to the initial polymerization reaction step. Reactor Wash Processing Off-specification product, line flushings, raw samples and material from reactor-cleaning are recycled in the reactor wash processing system. This system recovers solvents from the abovelisted material using a flash evaporator and condenser. The condenser discharges recovered solvent back to the wet solvent collection tanks. Other material recovered from the system is collected, allowed to solidify, and stored prior to landfill disposal off-site. Unicid Acid This new process (May 2006) manufactures long chain carboxylic acids, using high molecular weight alcohol wax manufactured at the facility. This raw material had previously been shipped off site to an independent contractor, who manufactured the acid and returned the finished product to the facility for packaging. Alcohol is pumped into a heated 4,000-gallon reactor, an aqueous solution of caustic is added, and more heat is added to distill the water out. Water vapor is condensed and routed to the existing aqueous handling system. The remaining material is heated to reaction temperature, forming a viscous salt. Nitrogen is used to purge the system during the reaction in order to remove minimal amounts of hydrogen generated. The salt is cooled and toluene from the existing toluene recycle process is added as a solvent to reduce viscosity. The salt/solvent mass is pushed into a glass-lined 4,000-gallon reactor containing aqueous hydrochloric acid (HCl). The resulting reaction forms potassium chloride (KCl) and the desired carboxylic acid. Water washes remove KCl and excess HCl and the washwater is routed to the existing aqueous handling system. The remaining material is heated and steam stripped to remove the solvent, which is routed to the existing solvent recycle system, and the product is sent to a packaging unit. The only equipment added for this process was two 4,000-gallon reactors, two condensers, a gas-fired 1-MMBTUH oil heater, two small pumps, and necessary piping components. RESIN UNIT The resin unit is a batch operation that manufactures various waxes through chemical reactions. These reactions require catalysts and elevated temperature and/or pressure, will usually generate heat, and generally use cooling water to maintain control of the reactions. The cooling water from this process is recirculated to the facility s non-contact cooling water tower. This system

4 PERMIT MEMORANDUM TVR2 DRAFT 4 consists of four reactors; one 750-gallon (Equipment ID No. C-6001), one 1,500-gallon (C- 6003), and two 8,500-gallon (C-6005 and C-6006). Volatile organic vapors are generated during the chemical addition and reaction processes. These vapors are condensed and collected in four storage tanks as a co-product. Vapors from each storage tank associated with a reactor are routed to a vent condenser (E-6026A, E-6026B, E-6027, and E-6028). The vent condensers are cooled with chilled water at approximately 40 F in a closed-loop system, resulting in high removal efficiency (> 70%) of organic compounds vented through the system. Vent parameters are listed at the end of Section III of this Memorandum. The product waxes from the resin unit are shipped in bulk, packaged into drums or pails, or transferred to the packaging unit systems. Cold Flow Description A new product line being manufactured at the Resin Unit is a Cold Flow Improver (CFI) used for depressing the pour points of crude oil has no appreciable effect on emissions, and is described here only for completeness. These CFIs are produced in existing equipment in the Resin Unit and use reactions similar to those for other current products. Production of the CFIs required minor changes to the existing system. The changes include the addition of a small reflux condenser on reactor C-6005 and an associated decanter that collects liquid and returns it to the reactor while venting any vapors to existing condenser E This condenser is installed prior to the vacuum receiver leading to condenser E-6010, where some emissions from the resin process are vented to the atmosphere through emission point EP The new product also requires use of a new solvent referred to as Solvent 14 or Aromatic 100 Solvent, which is stored in a new 8,000-gallon tank before being added to the process. This tank is vented to condenser E-6028, described in the preceding paragraph. Products from this process are transferred directly to a tank truck for shipment or to totes for storage. The changes to the Resin Unit do not increase the overall production capacity of the unit and when combined with the existing production, do not exceed the limits specified in the current Title V permit. OXIDATION UNIT The oxidation unit consists of two approximately 7,500-gallon vessels (C-6101 and C-6105), which are equipped to treat wax by forcing air through spargers at the bottom of each oxidizer. The air is supplied from two 2,000-scfm blowers (G-6111A and G-6111B) and is used as the source of oxygen for agitation of the wax during the oxidation process and to maintain control of the oxidation rates at specific temperatures. The excess air exits the oxidation units through a knockout pot and is then burned in a catalytic oxidizer, Emission Point V Steam and cooling water are also used to assist in temperature control for the oxidation units. The steam condensate is returned to the facility feed water system and the cooling water is routed to the non-contact cooling water tower. One of the oxidation units is outfitted as a pressure vessel (C- 6105) and contains a vacuum jet that removes vapors. This vacuum jet operates approximately 12 hours per month and results in discharges containing an aromatic substitute of urea through the catalytic oxidizer. The oxidizer vents to the atmosphere through a 1.5 diameter stack, exhausting a maximum 4,000 scfm at 1,000 F at 58 above grade. The product waxes (oxidized waxes) can be transferred directly to the packaging unit systems or to storage tanks, pending final packaging.

5 PERMIT MEMORANDUM TVR2 DRAFT 5 MISCELLANEOUS SOURCES Emulsions Production Emulsions are produced by dispersing wax products in water. The generic materials for the process are wax, water, surfactant, and biocide, which is optional. Emulsion processing uses several different procedures, namely wax to water, water to wax, heat/mix, and finally blend/homogenize. Wax to water and water to wax processes are very similar. The two components start in separate vessels at elevated temperatures, with the surfactant mixed in one of them. To form the emulsion, one of the components is slowly added to the other component while mixing. After the emulsion is formed, the product is cooled and packaged. When biocide is used, it is added just before packaging. Heat/mix operations are very basic. All of the raw materials are put into a single vessel and heated. The material is agitated to disperse the components. The product is then cooled, and finally packaged. Blend/homogenize operations are more complex. First, the materials are blended together in one vessel. Then they are heated and mixed using the coils and agitator in the vessel. Next, they are transferred through a homogenizer to a second vessel. The homogenizer is a very high-pressure pump with a very small orifice. It causes extreme mixing in the liquid being pumped. Numerous processing steps are required to accomplish this due to the high pressure involved, and the need to protect the homogenizer equipment from physical damage. The liquid may be passed back and forth through the homogenizer between the two vessels several times to achieve the desired product characteristics. After homogenizing, the product is cooled and packaged. Equipment for the emulsion system consists of two stainless steel vessels with approximately 2,000-gallon working capacity. The vessels are pressure rated to 150 psi, with internal coils and agitators. The homogenizer pumps approximately 15 gpm, and is rated for about 15,000 psi. A small gear pump is installed before the homogenizer to maintain positive suction pressure. Deionized water is produced using an off-the-shelf ion exchange system. Because the water-based emulsions are non-hazardous, packaging is accomplished by simply transferring the product to a container through a bag type filter and a hose. The container may be a drum, pail or tote. The proper amount of product is weighed as it is added to the container, and then sealed for shipment. The emissions from this process are negligible, so this process has been added to the insignificant activity list. Microcrystalline Wax Blending and Packaging Microcrystalline waxes are produced by simply blending different waxes together, and packaging, or shipping out as liquid bulk product. Some of the waxes are purchased from outside sources and brought in by tank truck. Other components of the blends are waxes made at the Barnsdall plant, which may be obtained from liquid bulk stock, or from packaged product stock. The blending may be done in any available tank, and agitation may be provided by rolling with nitrogen if no mechanical agitator is present. Rolling is equivalent to fluidized bed action. Packaging of microcrystalline waxes is accomplished by prilling, mini-prilling, pastilling, micronizing, or slabbing. Slabbing is the production of wax in large blocks.

6 PERMIT MEMORANDUM TVR2 DRAFT 6 Packaging and Shipping Both liquid and solid products are shipped from BPC to customers. Liquids are shipped via tanker truck, or in packages such as drums, bulk bags, and pails. Solid waxes are sized and packaged into various bags, totes, and drums for shipment. Spray Micronizer This is a process that atomizes wax into extremely fine particles. Molten wax and steam are injected into a micronizing nozzle. The exiting wax particles are air cooled and captured in a baghouse, from which they are removed with compressed air. They are sorted through a sizing shaker screen and drummed or bagged as a product. Oversized particles are melted and returned to feedstock. Moisture content and particle size are partially controlled with elevated temperatures and occasional use of nitrogen. A 2,500-scfm blower induces heated air through the ductwork and baghouse. The baghouse is integral to production, and applicant does not consider it to be a piece of pollution control equipment. It has an efficiency of 99.99%. The baghouse exhausts 2,500 scfm at 120 F through a 10 diameter stack identified as emission point G-6303, venting at 39 above grade. Sandvik Belt Unit This process produces small wax beads called pastilles. Molten wax is pumped through pastillating heads to produce small drops of wax, which fall onto a stainless steel conveyor belt. Chilled and/or cooling water is sprayed on the underside of the belt, causing the drops to solidify upon contacting the belt surface. A scraper blade separates the pastilles from the belt; they are sorted on a screen shaker, and packaged as product. Oversized drops are returned to feedstock. There are two lines, identical in operation and length, but with different widths. Air Attrition Unit In this process solid wax is tumbled by compressed air, fracturing the pieces of wax into smaller particles. Particles are carried into a cyclone by the exhaust air stream. Fine particles collect in the center of the cyclone and pass to a baghouse. Particles are removed from the baghouses using compressed air, and the products are packaged. One difference from the micronizer system is that a flexible hose is attached to the exhaust system only during start-up, and a filter sack is placed over the end of the hose. Once the system is operating properly, air is routed through the baghouse and the hose is disconnected. This prevents emissions during the start-up process. As with the micronizer system, the baghouse is integral to production, and applicant does not consider it to be a piece of pollution control equipment. It has an efficiency of 99%. The baghouse exhausts 105 scfm at 100 F through a 4 diameter stack identified as emission point AAM, venting at grade. Prilling Tower Molten synthetic wax is pumped from storage to the top of the prilling tower and sprayed downward. Ambient air is pulled upwards through the tower and the resulting countercurrent heat transfer allows the droplets of copolymer to form into hard beads. The beads are screened for size, with the larger beads being returned to the heated storage tanks. The reverse air is fed to cyclones for recovery of copolymer fines, which are also returned to the heated storage tanks. Although the cyclones act as pollution control devices, they are integral to the process and recover valuable material for processing.

7 PERMIT MEMORANDUM TVR2 DRAFT 7 Mini-Prill Description Mini-Prilling (MP) is very similar to prilling. The primary differences between prilling and MP are: that MP produces a much smaller bead; that MP uses different geometry, spraying the liquid up into the air, and allowing it to fall back down into the bed; that MP allows the potential to recirculate air back into the MP system; that MP uses a cooling exchanger and a filter cloth to prepare the cooling air before re-using it; and that a refrigeration unit is used to help chill the air that flows through the unit. Liquid wax is fed from existing wax storage tanks to a booster pump which forces wax through heated spray bars. As it is forced through the nozzles it is sprayed up into a spray chamber. As the wax is sprayed up, most of it forms spherical particles that descend onto a perforated plate. Air is forced through the holes of the perforated plate causing the wax particles to hover in a layer above the perforated plate. As the particles hover, they are continuously moving and being cooled by air, which is being cooled itself in an exchanger by a chilled water system. A blower forces this air through a cooler into an air box with the perforated plate on top. After going through the perforated plate, the forced air continues upward, also cooling and slowing down the descending wax particles. Very small wax dust particles that do not agglomerate onto the larger spherical particles rise to the top of the spray chamber. At the top of the spray chamber, the air is sucked through a cotton cloth by a fan with an adjustable shutter, which regulates the air velocity in the spray chamber. As the air goes through the cotton cloth, wax dust is collected and the filtered air is either released through shutters in the ductwork or recirculated through the air cooler. The device in which the fluidized bed and air separation system are contained is called a granulator. The wax particles exit the granulator by overflowing a dam above the perforated plate. A pneumatic conveyor moves the particles to a large hopper that feeds a standard bagger. The Mini-Prill process and the Prill Tower operation are both currently active, but MP emissions are so slight as to be considered an insignificant activity. The production limit set for the tower satisfies compliance requirements for both activities. SUPPORT OPERATIONS Support operations at the facility include utilities, packaging and shipping (including wax prilling), wastewater collection and treatment, other maintenance activities, and a staging area for oil well field treatment activities. Utilities The plant operates three boilers to generate steam used in the production areas. Boilers #1 and #2 have maximum design firing rates of 72.2 MMBTUH and Boiler #3 has a maximum design firing rate of 52.5 MMBTUH. The primary fuel for the boilers is pipeline grade natural gas. Boilers #1 and #2 are also capable of burning No. 2 fuel oil, but are limited to 480,000 gallons (total in both boilers) each calendar year. Oil use is intended for periods of gas curtailment. Coproducts may be used as fuel, as might other materials, if approved by DEQ. A discussion of alternate fuels is found in the following Emissions section and at other appropriate locations in this Memorandum. Other utilities described at this point in the application have been moved to the Insignificant Activities listed at the end of Section V below.

8 PERMIT MEMORANDUM TVR2 DRAFT 8 III. EQUIPMENT There are many process vessels in this facility, but only those vessels capable of emitting to the atmosphere through a vent or control device are listed. EUG 1 Polywax Units (EP A & B) Point Service Capacity Const Date C-1005 Reaction Initiator Tank & Weigh Cell 10,000 gal 1970 C-3020 Reaction Initiator Tank & Weigh Cell 12,000 gal 1993 C-1002 Carrier Solvent Storage Tank 10,000 gal 1970 E-4351 Oxidation Vessel Condenser (Plant A) N/A 1993 E-4350 Final Vent Condenser (Plant A) N/A 1993 E-4310 Final Vent Condenser (Plant B) N/A 1989 F-0000 Fugitives (Plants A & B) N/A 1989 Fugitives include storage tanks, wastewater basin and lagoons, as well as piping, flanges, etc. EUG 2 Prilling Tower CYVENT Buffalo Type L Note that the mini-prill equipment is treated as Insignificant. EUG 3 Boilers Point Make/Model Serial # Capacity Const Date BLR1 Trane/Coen MMBTUH 1978 BLR2 Trane/Coen MMBTUH 1978 BLR3 Trane/Coen MMBTUH 1978 EUG 4 Resin Unit Point Service Const Date E-6010 Condenser vent 2004 E-6026A Co-product storage tank condenser vent 1989 E-6026B Co-product storage tank condenser vent 2004 E-6027 Co-product storage tank condenser vent 2004 E-6028 Co-product storage tank condenser vent 2004 EUG 5 Oxidation Unit Point Service Const Date V-6101 Catalytic oxidizer exhaust 1999 EUG ALL Facility Wide This EUG is established to consider all rules and regulations that apply to the entire facility.

9 PERMIT MEMORANDUM TVR2 DRAFT 9 The following table shows pertinent information about each of the stacks. Note that all flow and temperature data reflect maximum conditions. For instance, vents flow only under certain pressure conditions and the point identified as E-4351 has flow only when the polymer oxidizer is processing material. STACK PARAMETERS Height Diameter Flow Temperature Point (Feet) (Inches) (ACFM) ( F) C-1005* Ambient C-3020* Ambient C Ambient E E E CYVENT , BLR , BLR , BLR , E E-6026A E-6026B E E V , G , AAM * Emissions from tank C-1005 flow through a seal pot (D-1002) and are emitted there. Similarly, emissions from C-3020 actually vent through D IV. AIR EMISSIONS Copolymer Production Calculation of emissions from the various units involved in producing the synthetic waxes require the use of proprietary data that the permittee requests be kept confidential. The process used by permittee is in the public domain, but stating actual amounts of solvent and raw materials used could reveal the specific techniques used. Only a description of the calculation technique will be presented in this public document. The actual calculations may be found in the confidential permit application package and will be required under a Specific Condition of the permit for compliance demonstrations. Emissions of solvent to atmosphere are based on material balance. The conservatively high assumption is that the difference between purchases of solvent and all known outputs is assumed to represent emissions. Following is a list of outputs. Synthetic waxes have been analyzed to determine the amount of solvent present. This amount is multiplied by the quantity of product manufactured.

10 PERMIT MEMORANDUM TVR2 DRAFT 10 Wastes injected at the disposal well are analyzed for solvent content in ppm. A simple calculation yields the total amount of solvent disposed. Some material is also shipped off-site and is considered by the permittee to be a coproduct. This material is analyzed for solvent content per barrel. Solvent disposed is the sum of solvent content of each barrel. Other waste solvent is collected in drums, analyzed for solvent content, and then shipped off-site for disposal. Emissions of raw materials are also based on material balance. Since ethylene is the principal raw material, the calculation process analyzes the other components first. Calculating the ratio of all waste (which may be off-spec product or material washed out of reactors) solids to total production forms an approximation of solid losses. This ratio is assumed to apply equally to each raw material. Each propylene co-polymer manufactured has a known theoretical content of propylene. Total quantity of each propylene co-polymer is multiplied by this theoretical value to generate the total amount of propylene actually present. This number is then multiplied by the solid loss ratio discussed earlier. Both numbers are subtracted from the quantity of propylene consumed and this result represents emissions. The process performed for propylene is duplicated for hexene and the stage is set for calculating ethylene emissions. Ethylene emissions are considered to be the difference between total consumption of raw materials (ethylene, propylene and hexene) and the sum of total production, propylene and hexene emissions, and solid losses. Calculation of propylene and hexene emissions has been described. Solid losses include solids accumulating in the 1017 Pit, wax picked up from the ground, spilled, leaked, or recovered in any other way, and solids collected in the weir section of the 1017 Pit. These various solids have ethylene content estimated by using the ratio of propylene co-polymers manufactured combined with estimates of their rate of accumulation. Permittee has requested a Plantwide Applicability Limit (PAL) of 550 TPY for VOC, which would include, but is not limited to, toluene, ethylene, propylene and hexene. Specific Conditions #1 and #4 shall be used to demonstrate compliance with the PAL. Prilling Tower There are no emissions of VOC from this source. Particulate emissions are calculated based on material balance and assume a conservatively low cyclone collection efficiency of 91%. These assumptions allow the calculation of an emission factor of 2.50 pounds of PM 10 per ton of liquid wax throughput. Maximum production is 3.45 TPH TPH 2.50 lbs/ton = 8.63 lbs/hr or TPY Mini-Prill Process The MP process does not use cyclones for product recovery, as is the case with the tower operation, and the fabric filters are much more efficient at product recovery. Assuming the filters to be at least 99.9% efficient and using the engineering calculations for the tower operation yields an estimated rate 0.42 TPY. Air from the unit is filtered and emissions are expected to be below the significant activity threshold of 5 TPY. Sufficient recordkeeping is required to demonstrate that it remains an Insignificant Activity.

11 PERMIT MEMORANDUM TVR2 DRAFT 11 Boilers All emission factors are taken from AP-42. Tables & 2 (3/98) are used for natural gas and Tables 1.3-1, 2 & 3 (9/98) are used for #2 fuel oil. Filterable and condensable PM factors are combined. Heat content of natural gas is assumed to be 1,050 BTU/CF, the firing rate of oil is the manufacturer s specification of 480 gallons per hour, and #2 sulfur content is taken to be 0.5% by weight. The original Part 70 permit assumed that #2 use would not exceed combined use of 1,000 hours for all boilers. The facility wants the ability to use the total quantity of liquid fuel used in this analysis, or 480,000 gallons per year, noting that some of the operating conditions may be at less than full load. For that reason, the third table following shows total boiler emissions. It is constructed by taking the highest value from each table, and combining results to create a table representing maximum values for each pollutant s emissions. For example, the highest lb/hr value for NO X comes when burning liquid fuel, so the total table shows 9.60 lbs/hr 2 for Units 1&2 plus 5.00 lbs/hr for Unit 3, or 24.2 lbs/hr. The TPY figure for NO X Unit 1 and/or 2 is calculated by taking 1,000 hours (combined) on liquid fuel, and then assuming continuous operations for both units less 1,000 hours on NG, plus continuous operation of Unit 3 on NG. Thus, (9.70 1,000) + (6.88 {(8,760 2) 1,000}) + (5.00 8,760) = 167,058 lbs/yr = 83.6 TPY, and similarly for the other values. Two alternate liquid fuels may be used, and their emissions are included in the second table, assuming two restrictions on their use. First, the alternates analyzed for this purpose are Solvent 250 and Solvent 125. Solvent 250 is a co-product consisting of primarily toluene, with toluene alkylates, synthetic wax, and water. Solvent 125 is primarily tert-butyl alcohol, with acetone and water. These two co-products have heat content of 18,000 22,000 BTU per pound, which is close to the heat content of #2 Oil. Analyses of these materials indicates that emissions will be similar to those of #2, except that NO X is expected to be elevated by 20%. Second, the restriction of liquid fuels to 480,000 gallons per year assures that the BTU contribution by liquid fuels is less than 5% of the potential annual BTUs combusted. Thus, the 20% per gallon boost caused by the alternate fuel is offset by the restriction on use, leading to a net increase of only 1%. This approach facilitates the addition of alternate fuels to this permit, if the facility requests such ability. BOILERS ON NATURAL GAS Factor Emissions (1 & 2, each) Emissions (3 only) Pollutant (Lb/MMCF) Lb/hr TPY Lb/hr TPY PM NO X CO VOC SO

12 PERMIT MEMORANDUM TVR2 DRAFT 12 BOILERS ON LIQUID FUEL Factor Emissions Pollutant (Lb/10 3 gal) Lb/hr (1 & 2, each) TPY (Both) PM NO X CO VOC SO S * * S = weight percent sulfur BOILERS - POTENTIAL TO EMIT Pollutant Lb/hr TPY PM NO X CO VOC SO Resin Unit There are emissions from the resin unit vacuum receiver water tank serving the four tanks in this process. Another condenser serves the storage tank vents. The applicant has performed an engineering study of losses in conjunction with the Texas Natural Resources Conservation Commission (TNRCC). Approximately 3% of all material charged to the reactors is trapped in the equipment, is flashed overhead and collected as co-products. Evaporative losses (VOC) have been calculated at 0.25%, but have conservatively been assumed to be 1% losses for this analysis. The chilled water vapor condensers are estimated to have 70% recovery or removal efficiency. Although operating hours are typically estimated to be 6,240 hours per year, the following calculations assume 8,760 hours per year. 10,400,000 lbs/yr 1% (1 70%) 1 ton/2,000 lbs = TPY VOC 3,120 lbs/hr 1% (1 70%) = 9.36 lbs/hr VOC Emissions from the condenser vent associated with the storage tanks are calculated based on EPAapproved Tanks3.1 computer model and the assumed 70% efficiency of the condenser. Two tanks are pressure vessels, 7 feet high by 6.5 feet in diameter, with capacity of 2,000 gallons each. The third tank is a fixed cone roof tank, 15 feet high by 12 feet in diameter, with a capacity of 10,000 gallons. Combined VOC emissions from all tanks are 0.01 lbs/hr and 0.03 TPY. Oxidation Unit VOC-laden air emissions from the three vessels are routed through a knockout pot, and then to the catalytic oxidizer. As in the case of the resin reactors, 3% of the material loaded is trapped in various parts of the equipment, is flushed out, and ultimately sold as off-spec product. Also as above, evaporative losses of 0.25% are increased to a conservatively high 1% for these calculations. The manufacturer of the oxidizer guarantees 95% destruction efficiency, but the applicant assumes a conservatively low value of 90% for these calculations. Although operating

13 PERMIT MEMORANDUM TVR2 DRAFT 13 hours are typically estimated to be 6,240 hours per year, the following calculations assume 8,760 hours per year. Packaging Units 6,240,000 lbs/yr 1% (1 90%) 1 ton/2,000 lbs = 3.12 TPY VOC 3,120 lbs/hr 1% (1 90%) = 3.12 lbs/hr VOC 1. Spray Micronizer Fine particles of wax are captured in a baghouse, whose capture efficiency is guaranteed by the manufacturer at 99.99%. For a maximum production of 1,000 tons per year, emissions are calculated based on an input of lbs/hr or 1,008 TPY, yielding lbs/hr ( %) = 0.06 lbs/hr PM or 1,008 TPY ( %) = 0.10 TPY PM No significant VOC emissions are anticipated. 2. Sandvik Belt Unit This process produces neither VOC nor PM emissions. Maximum annual capacity for this unit is approximately 12,000 tons of product. 3. Air Attrition Unit Fine particles of wax are sent through a cyclone with an efficiency of 90%, and are then captured in a baghouse, whose capture efficiency is guaranteed at 99.99%. For a maximum production of 50 tons per year, emissions are calculated based on an input of 20.2 lbs/hr or 50.5 TPY, yielding 20.2 lbs/hr (1 90%) ( %) = lbs/hr PM 50.5 TPY (1 90%) ( %) = TPY No significant VOC emissions are anticipated. Storage Tanks Tanks have been considered as part of the emissions contemplated from the Polywax plants. HAP emissions The VOC emissions listed in the Resin and Oxidation Units above have been speciated into component chemicals. Since the percentages attached to each process could reveal proprietary process information, details may be found in the confidential application packet. A summary of this list of compounds shows that 13.7 TPY or 3.1 lbs/hr is attributable to t-butyl alcohol, CAS # Although the instantaneous hourly rate is approximately 8.2 lbs/hr, such a rate cannot be sustained through a 24-hour period. Only about 1½ TPY of the entire list are HAPs. V. INSIGNIFICANT ACTIVITIES The insignificant activities identified and justified on Part 1b of the forms in the application and duplicated below were confirmed by the initial operating permit inspection. Records are available which confirm the insignificance of the activities. Appropriate recordkeeping is required for those activities indicated below with an asterisk.

14 PERMIT MEMORANDUM TVR2 DRAFT 14 * Stationary reciprocating engines burning natural gas, gasoline, aircraft fuels, or diesel fuel that are either used exclusively for emergency power generation or for peaking power service not exceeding 500 hours/year. There is a 743-hp diesel-fueled emergency generator that is not utilized in excess of 500 hours per year. A 200-hp diesel-fueled fire water pump is similarly limited. Space heaters, boilers, process heaters, and emergency flares less than or equal to 5 MMBTUH heat input (commercial natural gas). The Unicid process includes a 1.0 MMBTUH oil heater. Other equipment of this sort may be added in the future. * Emissions from fuel storage/dispensing equipment operated solely for facility-owned vehicles if fuel throughput is not more than 2,175 gallons/day (gpd), averaged over a 30-day period. The facility has two 564-gallon gasoline storage tanks. According to a full compliance evaluation performed May 5, 2009, the maximum monthly fuel purchase in the preceding year was 1,871 gallons in October of 2008, well below the threshold. * Emissions from storage tanks constructed with a capacity less than 39,894 gallons which store VOC with a vapor pressure less than 1.5 psia at maximum storage temperature. Permittee has two 564-gallon, one 1,034-gallon and one 9,800-gallon #2 fuel oil tanks. None of these tanks is subject to NSPS or to State permitting rules, and all store liquids with vapor pressure well below the 1.5 psia threshold. Other tanks may be added in the future. * Non-commercial water washing operations (less than 2,250 barrels/year) and drum crushing operations of empty barrels less than or equal to 55 gallons with less than 3% by volume of residual material. Less than 150 drums per year are crushed. Hazardous waste and hazardous materials drum staging areas. Up to six drums of hazardous waste are stored at any time. Hazardous materials are staged routinely. Exhaust systems for chemical, paint, and/or solvent storage rooms or cabinets, including hazardous waste satellite (accumulation) areas. The facility has such sources and may add others in the future. Hand wiping and spraying of solvents from containers with less than 1-liter capacity used for spot cleaning and/or degreasing in ozone attainment areas. A number of sources may be considered as insignificant because their emissions are below 5 TPY and they are not subject to NSPS, NESHAP, or State rules. a) Less than 14 laboratory hoods and vents. b) Pyrolysis of laboratory glassware. c) Particulate emissions from bagging units. d) The Miniprill process. e) The Emulsion process. f) Microcrystalline blending. g) Unicid process

15 PERMIT MEMORANDUM TVR2 DRAFT 15 h) As noted in previous discussion, emissions from the micronizer unit are extremely low. i) As noted in previous discussion, emissions from the air attrition unit are extremely low. VI. OKLAHOMA AIR POLLUTION CONTROL RULES OAC 252:100-1 (General Provisions) Subchapter 1 includes definitions but there are no regulatory requirements. [Applicable] OAC 252:100-2 (Incorporation by Reference) [Applicable] This subchapter incorporates by reference applicable provisions of Title 40 of the Code of Federal Regulations listed in OAC 252:100, Appendix Q. These requirements are addressed in the Federal Regulations section. OAC 252:100-3 (Air Quality Standards and Increments) [Applicable] Subchapter 3 enumerates the primary and secondary ambient air quality standards and the significant deterioration increments. At this time, all of Oklahoma is in attainment of these standards. OAC 252:100-5 (Registration, Emissions Inventory and Annual Operating Fees) [Applicable] Subchapter 5 requires sources of air contaminants to register with Air Quality, file emission inventories annually, and pay annual operating fees based upon total annual emissions of regulated pollutants. Emission inventories were submitted and fees paid for previous years as required. OAC 252:100-8 (Permits for Part 70 Sources) [Applicable] Part 5 includes the general administrative requirements for Part 70 permits. Any planned changes in the operation of the facility that result in emissions not authorized in the permit and that exceed the Insignificant Activities or Trivial Activities thresholds require prior notification to AQD and may require a permit modification. Insignificant activities refer to those individual emission units either listed in Appendix I or whose actual calendar year emissions do not exceed the following limits. 5 TPY of any one criteria pollutant 2 TPY of any one hazardous air pollutant (HAP) or 5 TPY of multiple HAPs or 20% of any threshold less than 10 TPY for a HAP that the EPA may establish by rule Emission limitations and operational requirements necessary to assure compliance with all applicable requirements for all sources are taken from the existing Part 70 operating permit, from the Part 70 renewal application, or are developed from the applicable requirement. OAC 252:100-9 (Excess Emissions Reporting Requirements) [Applicable] Except as provided in OAC 252: (a)(1), the owner or operator of a source of excess emissions shall notify the Director as soon as possible but no later than 4:30 p.m. the following working day of the first occurrence of excess emissions in each excess emission event. No later than thirty (30) calendar days after the start of any excess emission event, the owner or operator of an air contaminant source from which excess emissions have occurred shall submit a report

16 PERMIT MEMORANDUM TVR2 DRAFT 16 for each excess emission event describing the extent of the event and the actions taken by the owner or operator of the facility in response to this event. Request for affirmative defense, as described in OAC 252: , shall be included in the excess emission event report. Additional reporting may be required in the case of ongoing emission events and in the case of excess emissions reporting required by 40 CFR Parts 60, 61, or 63. OAC 252: (Open Burning) [Applicable] Open burning of refuse and other combustible material is prohibited except as authorized in the specific examples and under the conditions listed in this subchapter. OAC 252: (Particulate Matter (PM)) [Applicable] Section 19-4 regulates emissions of PM from new and existing fuel-burning equipment, with emission limits based on maximum design heat input rating, as shown in Appendix C. Fuelburning equipment is defined in OAC 252: as any internal combustion engine or gas turbine, or other combustion device used to convert the combustion of fuel into usable energy. Thus, the three boilers are subject to the requirements of this subchapter. AP-42 (7/98) Table lists natural gas TPM emissions to be 7.6 lbs/mmscf or about lbs/mmbtu, which is in compliance. AP-42 (9/98) Tables and list #2 fuel oil TPM emissions to be 3.3 lbs/1,000 gallons or about 0.02 lbs/mmbtu, which is in compliance. Equipment Maximum Heat Input Appendix C Emission Limit, (lbs/mmbtu) Potential Emission Rate, (lbs/mmbtu) BLR MMBTUH (oil) BLR MMBTUH (oil) BLR MMBTUH (oil) Section limits particulate emissions from emission points in an industrial process based on process weight rate, as specified in Appendix G. As shown in the following table, all emission points are in compliance with Subchapter 19. Equipment Process Rate, TPH Appendix G Emission Limit, lbs/hr Potential Emission Rate, lbs/hr Micronizer Air attrition Prilling tower Mini-prill OAC 252: (Visible Emissions and Particulates) [Applicable] No discharge of greater than 20% opacity is allowed except for short-term occurrences that consist of not more than one six-minute period in any consecutive 60 minutes, not to exceed three such periods in any consecutive 24 hours. In no case shall the average of any six-minute period exceed 60% opacity. Filters used to conserve product prevent most PM emissions. When burning natural gas there is very little possibility of exceeding these standards.

17 PERMIT MEMORANDUM TVR2 DRAFT 17 OAC 252: (Fugitive Dust) [Applicable] No person shall cause or permit the discharge of any visible fugitive dust emissions beyond the property line on which the emissions originated in such a manner as to damage or to interfere with the use of adjacent properties, or cause air quality standards to be exceeded, or to interfere with the maintenance of air quality standards. Under normal operating conditions, this facility has negligible potential to violate this requirement; therefore it is not necessary to require specific precautions to be taken. OAC 252: (Sulfur Compounds) [Applicable] Part 5 The new (constructed after July 1, 1972) equipment standard for emissions of oxides of sulfur measured as sulfur dioxide from gas-fired fuel-burning equipment is 0.2 lbs/mmbtu heat input, maximum three-hour average. The three boilers were installed in 1978 and are new equipment. AP-42, Table (3/98), lists natural gas SO 2 emissions to be 0.6 lbs/mmft 3 or about lbs/mmbtu, which is in compliance. The standard for liquid fuel is 0.8 lbs/mmbtu, and the AP-42 factor for #2 fuel oil equates to approximately 0.48 lbs/mmbtu, which is also in compliance. OAC 252: (Nitrogen Oxides) [Applicable] This subchapter limits new (constructed after July 1, 1972) gas-fired or liquid-fired fuel-burning equipment with rated heat input greater than or equal to 50 MMBTUH to emissions of 0.20 or 0.30 lbs of NOx per MMBTU, three-hour average, respectively. The three boilers were installed in 1978 and are new sources. Their rated heat inputs of 72.2, 72.2 and 52.5 MMBTUH all exceed the 50 MMBTUH threshold and they are affected sources. The AP-42 factor for natural gas is approximately 0.1 lb/mmbtu and the factor for #2 fuel oil equates to approximately 0.13 lbs/mmbtu, both of which are in compliance. OAC 252: (Carbon Monoxide) [Not Applicable] None of the following affected processes are located at this facility: gray iron cupola, blast furnace, basic oxygen furnace, petroleum catalytic cracking unit, or petroleum catalytic reforming unit. OAC 252: (Volatile Organic Compounds) [Applicable] Part 3 requires storage tanks constructed after December 28, 1974, with a capacity of 400 gallons or more and storing a VOC with a vapor pressure greater than 1.5 psia to be equipped with a permanent submerged fill pipe or with an organic vapor recovery system. The vapor pressures of diesel, kerosene, and toluene are all less than 1.5 psia; therefore, Part 3 does not apply to the storage of these liquids. The two 564-gallon gasoline tanks are properly equipped. Part 5 limits the VOC content of coating used in coating lines or operations. This facility will not normally conduct coating or painting operations except for routine maintenance of the facility and equipment, which is not an affected operation. Part 7 requires fuel-burning equipment to be operated and maintained so as to minimize emissions. Temperature and available air must be sufficient to provide essentially complete combustion.

18 PERMIT MEMORANDUM TVR2 DRAFT 18 OAC 252: (Toxic Air Contaminants (TAC)) [Applicable] This subchapter regulates toxic air contaminants (TAC) that are emitted into the ambient air in areas of concern (AOC). Any work practice, material substitution, or control equipment required by the Department prior to June 11, 2004, to control a TAC, shall be retained, unless a modification is approved by the Director. Since no AOC has been designated there are no specific requirements for this facility at this time. OAC 252: (Testing, Monitoring, and Recordkeeping) [Applicable] This subchapter provides general requirements for testing, monitoring and recordkeeping and applies to any testing, monitoring or recordkeeping activity conducted at any stationary source. To determine compliance with emissions limitations or standards, the Air Quality Director may require the owner or operator of any source in the state of Oklahoma to install, maintain and operate monitoring equipment or to conduct tests, including stack tests, of the air contaminant source. All required testing must be conducted by methods approved by the Air Quality Director and under the direction of qualified personnel. A notice-of-intent to test and a testing protocol shall be submitted to Air Quality at least 30 days prior to any EPA Reference Method stack tests. Emissions and other data required to demonstrate compliance with any federal or state emission limit or standard, or any requirement set forth in a valid permit shall be recorded, maintained, and submitted as required by this subchapter, an applicable rule, or permit requirement. Data from any required testing or monitoring not conducted in accordance with the provisions of this subchapter shall be considered invalid. Nothing shall preclude the use, including the exclusive use, of any credible evidence or information relevant to whether a source would have been in compliance with applicable requirements if the appropriate performance or compliance test or procedure had been performed. The following Oklahoma Air Quality Rules are not applicable to this facility. OAC 252: Alternative Reduction not requested OAC 252: Mobile Sources not in source category OAC 252: Incinerators not type of emission unit OAC 252: Cotton Gins not type of emission unit OAC 252: Feed & Grain Facility not in source category OAC 252: Organic Materials Nonattainment not in control area OAC 252: Landfills not in source category