February 21, Permit: APC-82/1209-CONSTRUCTION (Amendment 5) Petroleum Coke Storage and Handling Complex

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1 Permit: APC-82/1209-CONSTRUCTION (Amendment 5) Petroleum Coke Storage and Handling Complex 4550 Wrangle Hill Road Delaware City, Delaware ATTENTION: Andrew Kenner Vice President and General Manager Dear Mr. Kenner: Pursuant to the State of Delaware Regulation No. 1102, Section 2, approval of the Department of Natural Resources and Environmental Control (the Department) is hereby granted for the construction of a coke storage and pneumatic handling complex with four storage silos, a surge bin for railcar loading, two ball mills, scrubber, and baghouses in addition to the existing coke storage silo and baghouse and the decommissioning of the existing railcar loading station, 4 storage silos at the Delaware City Power Plant and the conveyor belt system located at the Delaware City Refinery in Delaware City, Delaware, in accordance with the application package submitted by the Company including the application on June 1, 2006, with Form Nos. AQM-4, AQM-4d, and AQM-4e signed by Andrew Kenner, a letter dated July 24, 2006 signed by John Deemer, 2 s dated July 24, 2006 from John Deemer, and Form AQM-4e dated August 21, 2006 signed by Andrew Kenner. This permit is issued subject to the following conditions: 1. General Provisions 1.1 The timeframe for construction of this system shall be completed in accordance with the Administrative Order on Consent Re: Coke Storage and Handling System dated April 3, This permit expires 3 years after date of issuance. 1.2 The project shall be constructed in accordance with the application described above. If any changes are necessary, revised plans must be submitted and supplemental approval issued prior to actual construction. 1.3 Representatives of the Department may, at any reasonable time, inspect this facility. 1.4 This permit may not be transferred to another location or to another piece of equipment or process.

2 Page This permit may not be transferred to another person, owner, or operator unless the transfer has been approved in advance by the Department. A request for a permit transfer shall be received by the Department at least 30 days before the date of the requested permit transfer. This request shall include: Signed letters from each person stating the permit transfer is agreeable to each person; and An Applicant Background Information Questionnaire pursuant to 7 Del C, Chapter 79 if the person receiving the permit has not been issued any permits by the Department in the previous 5 years. Approval (or disapproval) of the permit transfer will be provided by the Department in writing. 1.6 The applicant shall, upon completion of the construction, installation, or alteration, request in writing that the Department grant approval to operate. 1.7 A separate application to operate pursuant to Regulation No does not need to be submitted to the Department for the equipment or process covered by this construction permit. The conditions in the existing Operating Permit shall remain in effect, in lieu of the operating conditions and emission limits set forth in this permit, until construction authorized by this permit is completed. Upon a satisfactory demonstration by an on-site inspection that the equipment or process complies with all of the terms and conditions of this permit, the Department shall issue a Regulation No Operating Permit for this equipment or process. 1.8 The provisions of Regulation No Sections 2.1 and 11.3 shall not apply to the operation of equipment or processes for the purposes of initially demonstrating satisfactory performance to the Department following construction, installation, modification, or alteration of the equipment or processes. The applicant shall notify the Department sufficiently in advance of the demonstration and shall obtain the Department s prior concurrence of the operating factors, time period, and other pertinent details relating to the demonstration. 1.9 The owner or operator shall not initiate construction, install, or alter any equipment or facility or air contaminant control device which will emit or prevent the emission of an air contaminant prior to submitting an application to the Department pursuant to Regulation No. 1102, and, when applicable Regulation No. 1125, and receiving approval of such application from the Department; except as authorized by this Permit or exempted in Regulation No Section Emission Limitations 2.1 Air contaminant emission levels from the coke storage and handling system inclusive of the baghouses, storage silos, truck loading operation, and gas scrubber shall not exceed the following and those specified by the State of Delaware Regulations Governing the Control of Air Pollution The particulate matter (PM) emissions from the scrubber and each baghouse shall not exceed the following limits:

3 Page 3 Emission Point Control Number PM Outlet Grain Loading (grains/dscf) 1 PS-01 Baghouse PS-02 Baghouse PS-03 Baghouse PS-04 Baghouse PS-04 Baghouse PS-05 Baghouse PS-06 Baghouse PS-07 Baghouse PS-08 Scrubber PS-09 Baghouse PS-10 Baghouse PS-11 Baghouse Emissions from the coke storage and handling system shall not exceed 36.5 tons per year of PM and 27.0 tons per year of PM 10, exclusive of emergency stacking performed according to the approved emergency stacking plan. Tons per year shall mean total emissions on a rolling 12-month basis. 2.2 The Company shall not cause or allow the emission of visible air contaminants and/or smoke from a stationary source, the shade or appearance of which is greater than 20% opacity for an aggregate of more than 3 minutes in any 1 hour or more than 15 minutes in any 24 hour period. 2.3 Odors from this source shall not be detectable beyond the plant property line in sufficient quantities such as to cause a condition of air pollution. 2.4 The Company shall not cause or allow visible particulate emissions of any petroleum coke that is being transported by a motor vehicle within the refinery. 2.5 The Company shall not cause or allow stockpiling or other storage of material at the refinery or transport of material to or from a storage facility within the refinery in such a manner as may cause a condition of air pollution. 2.6 The Company shall remove all coke from the existing outside storage pile as soon as practicable upon commencement of operation of the equipment or process authorized by this permit. 3. Operational Limitations 3.1 At all times, including periods of startup, shutdown, and malfunction, the Company shall maintain and operate the equipment and processes covered by this permit, including all structural and mechanical components of all equipment and processes and all associated air 1 The Outlet Grain Loading emission rate shall be the arithmetic mean of the results of the three test runs as required by the stack testing requirement in Condition 4.2

4 Page 4 pollution control equipment, in a manner consistent with good air pollution control practice for minimizing emissions. 3.2 The coke moisture content of the coke being loaded into trucks shall be at least 8% at all times and at least 10% on an annual average basis. 3.3 The truck loading operation shall employ an extendable chute or other equivalent device through which the coke is loaded. The chute shall extend sufficiently into the truck to minimize fugitive emissions. 3.4 Fugitive emissions from railcar loading operations shall be controlled. The Company shall submit to the Department for approval a fugitive emission control design plan for railcar loading within 45 days of completion of detailed engineering. 3.5 The Company shall pave and maintain as paved all roads and truck movement areas within the facility that are used in transporting or moving petroleum coke. 3.6 The Company shall regularly use a street sweeper or other approved method to clean the paved areas where coke accumulates. 3.7 Trucks containing coke must be covered at all times except when being loaded with coke or as soon as practicable thereafter. 3.8 Within 45 days of completion of detailed engineering, the Company shall submit a detailed emergency stacking plan for the Department s approval. The Company and the Department shall work cooperatively to finalize the plan for approval by the Department. The plan shall include control measures to be taken to control coke dust in the event emergency (outdoor storage) stacking takes place. The approved plan shall also identify the emission standards and/or operating requirements that apply during emergency stacking, in lieu of the conditions identified in this permit. The emission standards and/or operating requirements identified in the approved plan shall be incorporated into the Operating Permit issued by the Department for the coke storage and handling process. 3.9 This permit does not authorize importing coke into the refinery The differential pressure ranges for the scrubber and the baghouses shall be identified by the Company, based on available information, for approval by the Department. The scrubber and baghouses shall operate within these established ranges. 4. Testing and Monitoring Requirements 4.1 Within 90 days after achieving the maximum production rate at which the facility will be operated, but not later than 180 days after initial startup of such facility, the owner or operator shall conduct performance test(s) and furnish the Department with a written report of the results of such performance test(s) in accordance with the following general provisions: One (1) original and 2 copies of the test protocol shall be submitted a minimum of 45 days in advance of the tentative test date to the address in Condition 6.3. The tests shall be conducted in accordance with the State of Delaware and Federal requirements The test protocol shall be approved by the Department prior to initiating any testing. Upon approval of the test protocol, the Company shall schedule the compliance demonstration with the Air Surveillance and Engineering & Compliance

5 Page 5 Branches. The Department must observe the test for the results to be considered for acceptance, unless the Department determines in advance, in writing, that the test need not be observed. Further, the Department may in its discretion determine based on its observation of the test that it need not observe the entire test The final results of the testing shall be submitted to the Department within 60 days of the test completion. One (1) original and 2 copies of the test report shall be submitted to the addresses below: Original and One (1) Copy to: One (1) Copy to: Engineering & Compliance Branch Air Surveillance Branch Attn: Assigned Engineer Attn: Program Manager 156 South State Street 715 Grantham Lane Dover, DE New Castle, DE To be considered valid, the final results report shall include the emissions test report (including raw data from the test) as well as a summary of the results and a statement of compliance or non-compliance with permit conditions signed by a member of the Company s Health, Safety and Environment department The results must demonstrate to the Department s satisfaction that the emission unit is operating in compliance with the applicable regulations and conditions of this permit; if the final report of the test results shows non-compliance the owner or operator shall propose corrective action(s). Failure to demonstrate compliance through the test may result in enforcement action. 4.2 Initial stack tests for PM and PM 10 shall be conducted at the scrubber and baghouses in accordance with the appropriate testing methods and at 5 year intervals thereafter. A list of baghouses to be tested shall be submitted for the Department s approval. 4.3 Visible Emission Standards: For each baghouse, compliance with the visible emission standard in Condition No. 2.2 shall be demonstrated by operating and monitoring a broken bag detection system or by performing daily qualitative stack observations according to Condition For the scrubber, compliance with the visible emission standard in Condition No. 2.2 shall be demonstrated by operating the scrubber within the specified differential pressure range established in accordance with Condition 3.10, or by performing daily qualitative stack observations according to Condition When required by sections and 4.3.2, the Company shall conduct daily qualitative stack observations to determine the presence of any visible emissions when the unit is in operation If visible emissions are observed, determine if they are below the standard. Plant personnel conducting the daily qualitative stack observations must be trained and knowledgeable regarding the effects on visibility of emissions caused by background contrast, ambient lighting, observer position relative

6 Page 6 to lighting, wind, and the presence of uncombined water vapor (condensing water vapor). This training can be obtained from the lecture portion of the EPA Reference Method 9 certification course. If the visible emissions are below the standard, no further action is required If observed visible emissions are greater than the standard, the Company shall take corrective actions as soon as possible and conduct a visible emission evaluation in accordance with Condition When required by condition , the opacity of the emissions shall be determined in accordance with subsection 1.5(c) of Regulation No. 20, conduct visual observations at fifteen-second intervals for a period of not less than one hour except that the observations may be discontinued whenever a violation of the standard is recorded. The additional procedures, qualification and testing to be used for visually determining the opacity shall be those specified in Section 2 & 3 (except for Section 2.5 and the second sentence of Section 2.4) of Reference Method 9 set forth in Appendix A, 40 CFR, Part 60, July 2005 edition. 4.4 Compliance with Condition 3.2 shall be based on collecting a sample of coke each day that petroleum coke is loaded into trucks and analyzing the sample to determine the moisture content. 4.5 Compliance with Condition No. 3.1 shall be based on information available to the Department concerning the Company s actions with respect to such events, and shall include the Department s review of all available facts and circumstances including, but not limited to, monitoring results, opacity observations, review of operating and maintenance procedures, and inspection of the source. 4.6 The Company shall conduct daily ambient TSP monitoring in accordance with the Quality Assurance Project Plan & Standard Operation Procedures for the Ambient Continuous Particulate Air Quality Monitoring Program at the Motiva Delaware City Power Plant and Coke and Flux Handling/Storage Facility, dated April If no exceedance of the secondary Delaware TSP 24-hour AAQS is monitored for any one year period after the issuance of the operating permit, the Company may petition the Department to approve ceasing monitoring operations. 4.7 The Company shall continuously monitor the differential pressure across the scrubber and the baghouses. 5. Record Keeping Requirements 5.1 The owner or operator shall maintain all records necessary for determining compliance with this permit in a readily accessible location for 5 years and shall make these records available to the Department upon written or verbal request. 5.2 The following information shall be recorded: Daily visible emissions observations, as required in Condition 4.3; Continuous scrubber and baghouse differential pressures when required; The daily amount of coke placed in emergency stacking on days when emergency stacking occurs;

7 Page Stack test results and related data, regardless of whether or not the stack test is completed; and The date, time, location, and corrective actions taken when the broken bag detection system indicates a potential failure The rolling 12 month total PM and PM 10 emissions shall be calculated and recorded each month. 6. Reporting Requirements 6.1 Emissions in excess of any permit condition or emissions which create a condition of air pollution shall be reported to the Department immediately upon discovery by calling the Environmental Emergency Notification and Complaint number, (800) Emissions in excess of any permit condition or emissions which create a condition of air pollution of a type that the Department and Company agree are more routine, may be faxed to (302) rather than called in. This condition may be revoked upon written notice to the Company by the Department in its sole discretion. 6.2 In addition to complying with Condition 6.1 of this permit, any reporting required by 7 Del C 6028 Reporting of a Discharge of a Pollutant or an Air Contaminant, and any other reporting requirements mandated by the State of Delaware, the owner or operator shall, for each occurrence of excess emissions, within 30 calendar days of becoming aware of such occurrence, supply the Department in writing with the following information: The name and location of the facility; The subject source(s) that caused the excess emissions; The time and date of the first observation of the excess emissions; The cause and expected duration of the excess emissions; For sources subject to numerical emission limitations, the estimated rate of emissions (expressed in the units of the applicable emission limitation) and the operating data and calculations used in determining the magnitude of the excess emissions; and The proposed corrective actions and schedule to correct the conditions causing the excess emissions Emissions on the same day from the same emission unit may be combined into one report. Emissions from the same cause that occur contemporaneously may also be combined into one report The Company shall submit an electronic copy of all required reports to the Department s compliance engineer assigned to the Refinery. 6.3 Proper operating parameters for the pneumatic coke transport system shall be submitted to the Department within 60 days of the completion of the initial stack tests. These parameters shall include, but need not be limited to, differential pressure, and flow. 6.4 One (1) original and 1 copy of all required reports shall be sent to the address below: Air Quality Management Section Division of Air and Waste Management 156 South State Street Dover, DE 19901

8 Page 8 7. Administrative Conditions 7.1 This permit shall be made available on the premises. 7.2 Failure to comply with the provisions of this permit may be grounds for suspension or revocation. Sincerely, Paul E. Foster, P.E. Program Manager Engineering & Compliance Branch PEF:CRR:BAS:ss F:\EngAndCompliance\BAS\07003bas.doc pc: Dover Title V File