Last week, I (Jean Payne) attended a two day course at the Asmark Institute on the requirements of the OSHA Process Safety Management (PSM) rule.  The Asmark Institute brought in an expert on PSM who also familiarized himself with the activities of a retail ammonia system.  For two full days, we learned about the requirements of this regulation and we barely made it through everything.  Here's where we stand, as briefly as I can manage to explain it below.  PSM is OSHA Standard 1910.119.  

 

1.  OSHA issued a proclamation on July 22, 2015 that "retail facilities" in their opinion are not exempt from PSM even though the regulation states that they have been exempt since 1992.  OSHA stated that they would give the industry six months to comply and the cost would be approximately $2,500 per facility to comply.  
 

2.  ARA and TFI have met with OSHA and are continuing to look at various ways to extend the compliance date, work with OSHA on more appropriate avenues to assure safety at ammonia facilities, develop more helpful enforcement policies, the legality of this decision by OSHA, the cost to the industry and impact on small business, etc.  
 

3.  PSM will require a change of culture at retail ammonia facilities.  PSM is not a checklist or "to do" list.  It requires constant management evaluation, decision making, investigation, and a systematic approach for everything that is done at an ammonia storage facility.  You document your thought process and how and why you make decisions to change a valve, work on a pipe, inspect a storage tank, hire a welder, etc. rather than just check a box that you did so.  Plus you evaluate the impact of the change.  
 

4.  The good news (if there is any) is that PSM does not extend to ammonia nurse tanks, just the storage tanks and all that occurs at the storage tank, including loading and unloading.  Nurse tanks are covered only when they are connected to the storage system.  In other words, maintenance on nurse tanks as we know it would not require PSM.  The requirements for PSM for storage tanks, however, are extensive.  For example, storage tanks will have to be inspected both externally and internally by a qualified inspector to remain in service.  
 

5.  The biggest requirement of PSM is "Management of Change" and "Mechanical Integrity."  Management of Change requires an analysis of every action taken at the storage tank, why and how it's taken, how the decision is made to replace or fix something, what procedures and standards you followed in making the change and how all these actions impact health and safety.  Mechanical Integrity pulls in all of the industry standards for valves, pumps, compressors, the tank itself, piping, etc and how they are maintained, inspected, repaired, etc.  Most violations that OSHA issues for PSM are due to non compliance in Operational Procedures, Management of Change and Mechanical Integrity areas.  OSHA violations start at $7,000 per citation and there can be dozens of areas where they can cite you for non compliance.  PSM will also require ammonia facilities to file a Program 3 RMP plan with USEPA, rather than a Program 2 RMP.  We are also evaluating how that will impact ammonia facilities with regard to RMP compliance, which is enforced by USEPA. 

 

6.  As a general rule, OSHA does not regulate farmers.  Therefore, ammonia storage tanks located on the farm, and used only for that farming operation, will be exempt from PSM.  In Illinois, ammonia storage tanks located on the farm must still comply with the IDA regulations.  
 

So, where do we stand?  First of all, IFCA is meeting with the IL Dept of Agriculture to evaluate how PSM is going to overlay with the forthcoming changes to the Illinois Ammonia Regulations, which are expected to be finalized in January 2016.  The problem is that any change to the storage system now requires PSM compliance, and the IDA rules require significant changes to the storage systems.  In essence, if you try to install a new valve or piping today or anytime in the near future, you would potentially be out of compliance with PSM even as you try to get in compliance with the IDA rules.  So we need careful consideration of how this is going to work to avoid significant federal penalties on top of state penalties.  
 

IFCA will be evaluating the best options for helping our members evaluate the PSM rule and what this means to your business.  You cannot "hire" someone to do your PSM plan. Well, you can but it won't assure you will be in compliance.  IFCA also cannot do your PSM plan for you.  While you can hire someone to help you understand the rule and give you some compliance tools, PSM is a management program that will require management at each facility to take ownership of all decisions and hazards associated with the ammonia storage system, as well as require all employees who work with the ammonia storage system to also understand PSM and what triggers a PSM requirement.  It also requires anyone you contract with such as a welder or installer, to be fully vetted by you to ensure they are in compliance with all applicable regulations that pertain to their business before they do work on your site.  

 

PSM is a rule that makes sense for manufacturing facilities where there are chemical reactions, many moving parts, components, pressurized systems and frequent contractual workers on site doing work--such as what you expect at a petroleum refinery, chemical plant or an ammonia manufacturing facility.  It will be a major challenge to incorporate this into retail ammonia but it is not impossible.  IFCA will investigate the best avenues to help you determine if you want to take this on and continue to be a part of the retail ammonia industry--there are definitely costs to consider in the big picture.  For those who wish to comply, we will find the right people to conduct training for you and our colleagues at the Asmark Institute are already working on tools to assist with compliance.  But please bear in mind that PSM will take a major commitment in ways we have never quite experienced in our industry, but which we are fully capable of achieving with education and commitment.  

 

The takeaway is this:  What happened at West, TX two years when 15 emergency responders were killed from an explosion at a retail fertilizer plant has changed our industry and we all knew in some way it would.  We also know it wasn't anhydrous ammonia that caused the explosion; however, the properties of anhydrous ammonia and that fact it is stored at retail plants subjects us to greater scrutiny and increased safety protections for workers and the surrounding community.    

 

Remember that Responsible Ag also exists to partner with you to help assure compliance with all federal regulations, including PSM.  If you have not yet registered to be in Responsible Ag, please consider doing so today to start the overall compliance assurance process.  Facilities registered with Responsible Ag will be among the first to receive accurate information and assistance on PSM.  Click here to register.  Finally, stay tuned for more updates from IFCA on PSM as we learn more about how we can help integrate this complex regulation into the Illinois retail ammonia industry.   

 

Asmark is hosting a few more two day PSM training sessions; if you are interested in attending click here.  The cost is $925 and Asmark is merely covering the expense of an extremely qualified expert as well as take home materials.  That gives you another perspective of just how extensive this rule is.  But if ammonia is important to you, I highly recommend it and I guarantee you will learn a great deal as I did; plus the interaction with others attending and how we collectively as the retail industry are going to manage this is also very worthwhile, as was the afterhours discussions with your peers!  

 

Thanks for your attention and if you have questions please contact Jean Payne.