Clarification of PSM applicability to processes that are based partly or solely on quantities in connected atmospheric storage tanks.

February 11, 2003

Mr. Armin J. Moeller, Jr.

Balch & Bingham, LLP

Attorneys and Counselors

[Recipient address omitted]

Dear Mr. Moeller:

Thank you for your October 16 letter to the Occupational Safety and Health Administration's (OSHA's) Directorate of Enforcement Programs (DEP). You have questions regarding OSHA's Process Safety Management of Highly Hazardous Chemicals; Explosives and Blasting Agents Standard (PSM), 29 CFR 1910.119. Please be aware that this response may not be applicable to any question or situation not delineated within your original correspondence. Our responses to your paraphrased scenario and questions are provided below.

Scenario: Our client, Mississippi Polymer Technologies, Inc. (MPT) has operations dedicated to chemical research and development. MPT has a small chemical laboratory and an open-air pilot plant. Pertinent facts include:

The laboratory and pilot plant are used to create small amounts of proprietary product;

The proprietary product is not a commercial product, and MPT does not sell the material;

MPT does not use any highly hazardous chemicals (HHCs) [toxic or reactive materials] in amounts exceeding the threshold quantity (TQ) amounts listed in the PSM Standard, 29 CFR 1910.119, Appendix A;

MPT does not use any process that involves 10,000 pounds or more of any flammable liquid or gas;

MPT has atmospheric storage capacity exceeding 10,000 pounds for one or more flammable liquids; and

Storage in atmospheric tanks and transfer of flammable liquids are accomplished below the normal boiling point of the flammable liquids and without benefit of chilling or refrigeration.

Question: Based on the above scenario, is MPT required to comply with the PSM standard?

Reply: While MPT has a PSM-covered process, it is not required to comply with the PSM standard based on the following:

The PSM-covered process includes the storage in atmospheric tanks and transfer of flammable liquids which are kept below their normal boiling points without benefit of chilling or refrigeration liquids at greater than TQ amounts. These flammable liquids are processed/used in another aspect or part of the covered process. Given that the portion of the covered process, excluding storage, does not contain a TQ or greater amount of a flammable liquid, pursuant to OSHA enforcement policy [1], employers are not required to comply with the PSM standard. This policy states that employers are not at this time required to comply with PSM when, with respect to a process that would otherwise qualify for the 1910.119(a)(1)(ii)(B) exemption, coverage of the process would be based partly or solely on the quantity of flammable liquid in connected atmospheric storage tanks; and

No process at the site includes TQ or greater amounts of a flammable gas or Appendix A HHC.

Note: The facts relating to MPT's laboratory and pilot plant processes and the proprietary product not being offered for commercial sale have no bearing on the scope and application of the PSM standard. In fact, OSHA has stated [2][3], that laboratory/research facilities are not exempt from the PSM standard when they have processes that contain a TQ or greater amount of an HHC. PSM coverage is established by the amount of HHC contained in a process. Other OSHA standards may apply to MPT including OSHA's Occupational Exposure to Hazardous Chemicals in Laboratories standard [4].

Thank you for your interest in occupational safety and health. We hope you find this information helpful. OSHA requirements are set by statute, standards and regulations. Our interpretation letters explain these requirements and how they apply to particular circumstances, but they cannot create additional employer obligations. This letter constitutes OSHA's interpretation of the requirements discussed. Note that our enforcement guidance may be affected by changes to OSHA rules. Also, from time to time we update our guidance in response to new information. To keep apprised of such developments, you can consult OSHA's website at http://www.osha.gov. If you have any further questions, please feel free to contact the Office of General Industry Enforcement at (202) 693-1850.

Sincerely,

Richard E. Fairfax, Director

Directorate of Enforcement Programs

[1] Memorandum for Regional Administrators from Director of Compliance Programs, Subject: Coverage of Stored Flammables Under the Process Safety Management Standard, dated May 12, 1997.

[2] PSM Compliance Directive, CPL 2-2.45A CH-1, Process Safety Management of Highly Hazardous Chemicals -- Compliance Guidelines and Enforcement Procedures, Appendix B. dated 09/13/1994.

"[Question] Does the PSM standard apply to laboratory and research operations? [Response] A laboratory or research operation involving at least the threshold quantity of one or more highly hazardous chemicals is subject to the PSM standard."

[3] Interpretation letter, requestor Kathleen A. Reamv, American Chemical Society, dated 6/24/92.

A..."laboratory" as defined in 29 CFR 1910.1450(b) is not subject to the PSM standards at 29 CFR 1910.119. "Laboratory" means a facility where the "laboratory use of hazardous chemicals" occurs. It is a workplace where relatively small quantities of hazardous chemicals are used on a non-product basis. Relatively small quantities are quantities less than the threshold quantities of highly hazardous chemicals listed in Appendix A of the PSM.... Although not applicable to laboratories, the PSM standards are applicable to other site facilities which contain processes involving highly hazardous chemicals at or above the threshold quantities.

[4] 29 CFR 1910.1450, Occupational Exposure to Hazardous Chemicals in Laboratories.