Outer Continental Shelf Air Permit OCS-EPA-R4009 for Murphy Exploration & Production Co.

Public Comment Period: February 29, 2012 – March 30, 2012

The United States Environmental Protection Agency (EPA) is seeking public comment on a draft Clean Air Act (CAA) Outer Continental Shelf (OCS) air permit for Murphy Exploration & Production Co. (Murphy), 16290 Katy Freeway, Suite 600, Houston, Texas 77094. The draft permit will regulate air pollutant emissions from the dynamically positioned Diamond Offshore Ocean Confidence drilling vessel and its associated support fleet that Murphy proposes to operate within its current Lloyd Ridge lease block 317 on the OCS in the Gulf of Mexico. The drilling area is located approximately 135 miles southeast of the mouth of the Mississippi River and 180 miles southwest of the Florida shoreline. Murphy proposes to conduct exploratory drilling at one well location within the lease block for up to 90 calendar days within a two year period. If natural gas reserves are discovered, the project will proceed to the completion phase using the Ocean Confidence and the well will be tied back to a floating production facility located west of longitude 87°30'00''W for processing and transporting to the intrastate gas marketing system. This air permit is for both the drilling and completion phases of the project.

EPA Region 4 is the agency responsible for implementing and enforcing CAA requirements for OCS sources in the Gulf of Mexico east of 87°30' (87.5). Pursuant to section 328 of the CAA, 42 U.S.C. § 7627, and the air quality regulations applicable to OCS sources set forth in Title 40, Code of Federal Regulations (CFR), part 55, an OCS source is required to obtain an air quality permit before beginning construction. EPA has completed review of Murphy’s air permit application and supplemental material and is soliciting comments on our proposal to issue Permit No. OCS-EPA-R4009 to Murphy for an exploratory drilling project subject to the terms and conditions described in the permit.

EPA has prepared a draft permit for public comment, as well as a preliminary determination/statement of basis document that explains the derivation of the permit conditions. These documents are available on EPA Region 4’s website at: http://www.epa.gov/region4/air/permits/ocspermits/ocspermits.html. To request a copy of these documents or to be added to our Murphy permit mailing list, please contact: Ms. Rosa Yarbrough, Permit Support Specialist, (404)562-9643 or R4OCSpermits@epa.gov. For questions on the draft permit, please contact: Ms. Lori Shepherd, (404)562-8435 or email: shepherd.lorinda@epa.gov.

Send comments on the draft permit and requests for a public hearing to: Lori Shepherd, EPA Region 4, APTMD, 61 Forsyth Street, S.W., Atlanta, GA 30303, Fax: (404)562-9066, Email: R4OCSpermits@epa.gov.

Public Comments must be received by email or postmarked by March 30, 2012.

Public Hearing requests must be received by EPA by email or mail by March 16, 2012.

Project Emissions: The maximum potential annual emissions in tons per year (TPY) from the Diamond Offshore Ocean Confidence drilling vessel and its associated support fleet are summarized in the following table. Murphy’s exploration drilling program is a major temporary source under the applicable Prevention of Significant Deterioration (PSD) permitting requirements, because emissions of oxides of nitrogen (NOx) exceed the major source applicability threshold of 250 TPY. Hence, Murphy is required to apply Best Available Control Technology (BACT) for NOx (as both a criteria pollutant and precursor to ozone and PM2.5).

¹VOC and NOx are the measured precursors for the criteria pollutant ozone and NOx is also a precursor for PM_2.5.

Public Comments: Any interested person may submit written comments on the draft permit during the public comment period. If you believe any condition of the permit is inappropriate, you must raise all reasonably ascertainable issues and submit all reasonably available arguments supporting your position by the end of the comment period. Any documents supporting your comments must be included in full and may not be incorporated by reference unless they are already part of the record for this permit or consist of state or federal statutes or regulations, EPA documents of general applicability, or other generally available reference materials.

Comments should focus on the draft air quality permit, the permit terms, and the air quality aspects of the project. The objective of the OCS air quality program is to control air pollution from OCS sources to attain and maintain ambient air quality standards and to prevent significant adverse environmental impact from air pollution by a new or modified OCS source. If you have more general concerns regarding things such as leasing, non-air quality impacts, drilling safety, discharge, etc., these should be addressed during the leasing and approval proceedings of the Bureau of Ocean Energy Management, which is the lead agency for this project.

All timely comments will be considered in making the final decision, included in the record, and responded to by EPA. EPA may group similar comments together in our response, and will not respond to individual commenters directly.

All comments on the draft permit must be received by email or postmarked by March 30, 2012. An extension of the 30-day comment period may be granted if the request for an extension adequately demonstrates why additional time is required to prepare comments. Comments must be sent or delivered in writing to the address above. All comments will be included in the public docket without change and may be made available to the public, including any personal information provided, unless the comment includes Confidential Business Information or other information whose disclosure is restricted by statute. Information that you consider Confidential Business Information or otherwise protected should be clearly identified as such and should not be submitted through email. If you send email directly to EPA, your email address will be captured automatically and included as part of the public comment. Please note that an email or postal address must be provided with your comments if you wish to receive direct notification of EPA’s final decision regarding the permit and responses to comments submitted during the public comment period.

Public Hearing: EPA has discretion to hold a public hearing if we determine there is a significant amount of public interest in the draft permit. Requests for a public hearing must be received by EPA by email or mail by March 16, 2012, and must state the nature of the issues proposed to be raised in the hearing. If a public hearing is held, you may submit oral or written comments on the proposed permit at the hearing. You do not need to attend the public hearing to submit written comments. If there is significant public interest, a public hearing will be held on March 29, from 3:00 p.m. to 5:00 p.m., at the following location:

Bay County Public Library

Northwest Regional Library System

898 W. 11th Street

Panama City, FL 32412-0625

(850)522-2119

If no timely request for a public hearing is received or EPA determines that there is not significant interest, the hearing will be cancelled. An announcement of cancellation will be posted on EPA’s website at: http://www.epa.gov/region4/air/permits/ocspermits/ocspermits.html or you may call EPA at the contact number above to determine if the public hearing has been cancelled.

Permit Documents: EPA’s draft permit, EPA’s preliminary determination and statement of basis, Murphy’s application and supporting documentation, and comments received from the public, other government agencies, and the applicant during the public comment period become part of the administrative record for the permit. All data submitted by the applicant is available as part of the administrative record. The administrative record is available to the public and is available at the following locations (please call in advance for available viewing times):

Bay County Public Library

Northwest Regional Library System

898 W. 11th Street

Panama City, FL 32412-0625

(850)522-2119

EPA Region 4 Office

61 Forsyth Street, S.W.

Atlanta, GA 30303

Phone: (404)562-9043

The administrative record is also available on EPA’s website at: http://www.epa.gov/region4/air/permits/ocspermits/ocspermits.html.

Final Determination: A final decision to issue a permit, or to deny the application for the permit, shall be made after all comments have been considered. Notice of the final decision shall be sent to each person who has submitted written comments or requested notice of the final permit decision, provided EPA has adequate contact information.