DAQ-2025-002305

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DAQC-PBR043070001-25
Site ID 4307 (B1)
MEMORANDUM

TO: FILE – SM ENERGY COMPANY – THOMAS 4-10B1

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

FROM: Chris Jensen, Environmental Scientist

DATE: April 30, 2025

SUBJECT: OIL AND GAS PERMIT-BY-RULE EVALUATION

INSPECTION DATE: April 29, 2025

SOURCE LOCATION: Lat: -109.975753 Long: 40.3292503
Uintah County

Business Office:
SM Energy Company
1700 Lincoln Street, Suite 3200 Suite 390
Denver, CO 80203

SOURCE TYPE: Tank Battery
API: 4304734080

SOURCE CONTACTS: James Lebeck, Corporate Environmental Contact
Phone: [phone], Email: [e-mail]
Ryan Sokolowski, Field Contact
Phone: [phone], Email: [e-mail]

OPERATING STATUS: Operating

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
(compressor 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: NSPS (60) OOOOa.

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SOURCE EVALUATION: Site Type: PBR-Voluntarily Controlled
No Flare Controls, Site powered by Line. The source registered:
8,913 Estimated Oil BBL.
DOGM current 12 month rolling production is: 6,621 BBLs.
Utah Statute R307-506 requires a source with throughput
greater than 8,000 BBLs to have controls.

REGISTERED EQUIPMENT: 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)] Out of Compliance. The thief hatch on the crude storage tanks were leaking. This is indicative of poor maintenance. 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. Storage Vessels 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] Out of Compliance. Thief hatches on the crude oil storage tanks were found leaking. Otherwise, no other leaking components were found during the survey. The components were all operated and installed as expected. 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. No electric generators are installed at this location. 32

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Associated Gas Flaring 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 34 Recordkeeping Requirements 41 Emission Inventory 42 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 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. 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. 66 Applicable Federal Regulations NSPS (Part 60) OOOOa: Standards of Performance for Crude Oil and Natural Gas Facilities for which Construction, Modification or Reconstruction Commenced After September 18, 2015 [40 CFR 60 Subpart OOOOa] In Compliance. The tank battery at this source no longer has the production to have the PTE in excess of 4 TPY and are no longer an affected facility under this subpart. There are no other affected facilities installed.

PREVIOUS ENFORCEMENT
ACTIONS: None in the past 5 years.

COMPLIANCE STATUS &
RECOMMENDATIONS: In regards to the site, the overall status is: Out of Compliance. The
leaking thief hatch does not meet the standard of closed, sealed,
and properly seated (NSPS 60.5411(b)(2)) and maintained to
minimize emissions (UAC R307-501). Other than the leaking
hatch gasket, the production equipment seems to be installed and
operated as expected.
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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. The operator's
representatives were pleasant and cooperative. Requested records
were provided in a timely manner and reviewed at the local field
office. SME personnel replaced the gasket during the evaluation.
No enforcement action recommended. This is a voluntarily
controlled source.

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

RECOMMENDATIONS FOR NSR: None

ATTACHMENTS: None