DAQ-2025-002112

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DAQC-PBR035990001-25
Site ID 3599 (B1) MEMORANDUM

TO: FILE – SCOUT ENERGY MANAGEMENT LLC – W Point 3-31-8-16

THROUGH: Rik Ombach, Minor Source Oil and Gas Section Manager

FROM: Chris Jensen, Environmental Scientist

DATE: April 17, 2025

SUBJECT: OIL AND GAS PERMIT-BY-RULE EVALUATION

INSPECTION DATE: April 9, 2025

SOURCE LOCATION: Lat: -110.1642112 Long: 40.0802816
Duchesne County

Business Office:
Scout Energy Management, LLC
13800 Montfort Drive, Suite 100
Dallas, TX 75240

SOURCE TYPE: Tank Battery

API: 4301334199

SOURCE CONTACTS: Chris Breitling, Corporate Environmental Contact
Phone: [phone], Email: [e-mail]
Kevan Stevens, Field Contact

OPERATING STATUS: Long term shut in.

PROCESS DESCRIPTION: Oil and gas products are brought to the surface. These products go
through a separator where the oil and any water products are sent
to storage tanks and the gas is used to power equipment on site
(pump jack engine, tank heater, separator, flare, combustor, etc.)
Any remaining gas is sent to a pipeline that feeds a local gas plant.
The oil and process water in the storage tanks is loaded into tanker
trucks and hauled off site for processing and disposal.

APPLICABLE REGULATIONS: Utah Administrative Code (UAC) R307-500 Series for the Oil and
Gas Industry, and UAC R307-201: Emission Standards: General
Emission Standards; and UAC R307-150: Emission Inventories.
Federal Subpart: 40 CFR 60 Subpart JJJJ.

SOURCE EVALUATION: Site Type: PBR-Uncontrolled
No Flare Controls, Site powered by Engine.
DOGM current 12 month rolling production is: 0 BBLs.
Utah Statute R307-506 requires a source with throughput
greater than 8,000 BBLs to have controls.
# - $ . ) . )
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REGISTERED EQUIPMENT: Engine - Natural Gas 2-Stroke Lean Burn Make - Ajax Model - E-
42 Mfg Year - Pre 7/1/2008 Horse Power - 40 Combustion -
Natural Gas, Pneumatic, Tank 3 General Provisions 5 Visible emissions are within the following opacity limits: VOC Control Devices and Gasoline engines 0%, Diesel engines 20%, Natural Gas Engines and Boilers, Treater burners & Tank burners 10%, Mobile source dust 10%. [ R307-201-3] In Compliance. No visible emissions were detected by use of the USEPA Method 9. 6 VOC emissions are, at all times, minimized as reasonably practicable by equipment design, maintenance and operation practices. [R307-501-4(1)] In Compliance. Associated gas is routed to a sales gathering line. Tanks all have thief hatches and PRV's that are closed and not leaking. The expected components were found installed. 7 All natural gas-driven pneumatic controllers are in compliance with 40CFR 60.5390 or 60.5390a as applicable. Tagging and record keeping requirements are not required. [R307-502-4] In Compliance. The natural gas-driven pneumatic controllers at this source are not continuous bleed but are low-bleed or snap acting. 11 Tank Truck Loading Truck loading is done by bottom filling or submerged fill pipe. [R307-504(1)] In Compliance. The truck loading area is suitable for submerged loading and it is routine for truck drivers to load this way. 14 Storage Vessels 15 Thief hatches are kept closed and latched. [R307-506-4(1)] In Compliance. All hatches were found closed at the start of the evaluation. 16 Vessel Vent Components: (valves, unions, pressure relief devices, etc.) are leak-free, in good repair, and working as intended. (Tank covers are leak free and form a continuous seal.). [R307-501-4] In Compliance. The DAQ used the OGI camera to look for leaks, but there were no obvious issues. 29 Natural Gas Engines 31 Temporary Emergency Generators, in use for less than 100 days, have an operational hour meter and log book (onsite) recording hours used and maintenance performed. [40 CFR 60 Subpart IIII, JJJJ] In Compliance. There are no emergency generators installed at this source.

Engines subject to R307-510 shall be certified or have an initial performance test per CFR 60.4244.
[R307-510-4(2)]

In Compliance. The engine installed at this source is not certified and may have not had an initial
performance test. The retention time for this document has expired. A maintenance plan has been
drafted and followed.
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Associated Gas Flaring 33 Associated gas is routed to a process unit for combustion, a sales pipeline or an operating VOC control device, except in an emergency. An emergency release is unanticipated, temporary, infrequent, unavoidable, =24 hrs. and is not due to operator negligence. Low pressure gas from working loss, breathing loss and oil flashing is not "associated gas". [R307-511-4(1)] In Compliance. Associated gas is gathered to a sales line. Recordkeeping Requirements 41 Emission Inventory An emissions inventory has been submitted within the past three years. [R307-150-9(1)] In Compliance. The operator submitted for the 2023 emissions inventory. 52 Oil and Gas Industry Registration Requirement 53 The source is registered with the DAQ. [R307-505-3(3)] In Compliance. 54 Registration has been updated within 30 days of a company name change, removal or addition of control devices, or termination of operations. [R307-505-3(3)] In Compliance. Natural Gas Engines 58 Engines that were installed, relocated or modified after January 1, 2016 are required to show compliance with Table 1 of R307-510-4 through a performance test evaluation that is reviewed by the DAQ and found to be in compliance. [R307-510-4(1)] In Compliance. This engine was installed at this location prior to 2016 and is not subject to R307-510 but, NSPS (60) JJJJ instead. See evaluation below. 59 Certified and non-certified engines are regularly maintained according to the Engine manufacturer's Schedule or the Maintenance Plan. [40 CFR 60 Subpart IIII, JJJJ, 63 Subpart ZZZZ] In Compliance. The engines have not been used in over a year and no maintenance has been performed. 6 Associated Gas Flaring The following records are kept: The time and date of event Volume of emissions Any corrective action taken for 3 years. [R307-511-5(1)(a)(b)] In Compliance. No reported breakdowns or venting. APPLICABLE FEDERAL REGULATIONS 68 NSPS (Part 60) JJJJ: Standards of Performance for Stationary Spark Ignition Internal Combustion Engines [40 CFR 60 Subpart JJJJ] In Compliance. The engine installed at this source is not certified and may have not had an initial performance test. The retention time for this document has expired. A maintenance plan has been drafted and followed.
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PREVIOUS ENFORCEMENT
ACTIONS: None in the past 5 years.

COMPLIANCE STATUS &
RECOMMENDATIONS: In regards to the site, the overall status is: In Compliance.
The production equipment seems to be installed and operated as
expected. The source appeared to be clean and orderly with all of
the expected components found. After a site visit, the DAQ
conducted a review of the recordkeeping requirements. Since none
of the engines installed here have been used in the last year, no
maintenance has been performed. The operator's representatives
were pleasant and cooperative. Requested records were provided
in a timely manner and reviewed at the local field office.

RECOMMENDATION FOR
NEXT INSPECTION: The DAQ has no recommendations for the next inspector other
than what are customary. The DAQ was joined by Scout personnel
during the site inspection.

RECOMMENDATIONS FOR NSR: None

ATTACHMENTS: None