STATE OF INDIANA ) BEFORE THE INDIANA DEPARTMENT

) SS: OF ENVIRONMENTAL MANAGEMENT

COUNTY OF MARION )

COMMISSIONER OF THE DEPARTMENT ) A-3460

OF ENVIRONMENTAL MANAGEMENT, ) A-3461

) A-3475

Complainant, ) A-3728

) CAUSE NO. A-3939

v. ) A-3960

) A-3960(b)

BETHLEHEM STEEL CORPORATION, ) A-4023

BURNS HARBOR DIVISION, ) A-4064

Respondent. ) A-4468

) A-4503

) A-4615

AGREED ORDER

The Complainant and the Respondent desire to settle and compromise this action without hearing or adjudication of any issue of fact or law, and consent to the entry of the following Findings of Fact and Order. Respondent is entering into this Agreed Order solely for the purposes of settling this enforcement action and to avoid ongoing litigation. Respondent's entry into this Agreed Order shall not constitute a waiver of any defense, legal or equitable, which Respondent may have in any future administrative or judicial proceeding. Nothing in this Agreed Order shall be construed to be an admission that any violations occurred, pursuant to IC 13-30-3-3.

I. FINDINGS OF FACT

1. Complainant is the Commissioner (hereinafter referred to as "Complainant") of the Indiana Department of Environmental Management, a department of the State of Indiana created by IC 13-13-1-1.

2. Respondent is Bethlehem Steel Corporation, Burns Harbor Division (hereinafter referred to as "Respondent"), which owns and operates a fully integrated steel mill located in the Towns of Burns Harbor, Porter, and Dune Acres, the City of Portage, and Westchester Township, Indiana.

3. The Indiana Department of Environmental Management ("IDEM") has jurisdiction over the parties and subject matter of this action.

4. Pursuant to IC 13-30-3-3, IDEM issued a Notice of Violation for each of the causes covered by this Agreed Order via Certified Mail to:

Thomas W. Easterly, Superintendent C.T. Corporation Systems,

Environmental Services Department Resident Agent for

Bethlehem Steel Corporation Bethlehem Steel Corporation

P.O. Box 248 One North Capitol Avenue

Chesterton, Indiana 46304 Indianapolis, Indiana 46204

5. Rule 326 IAC 5-1-2 requires that visible emissions from a source or facility located in Porter County not exceed an average of forty percent (40%) opacity in twenty-four (24) consecutive readings.

6. An inspector from IDEM observed visible emissions from the Respondent's Basic Oxygen Furnace (BOF) roof monitor exceed an average of forty percent (40%) opacity in twenty-four (24) consecutive readings while conducting inspections on October 6, 1995, October 11, 1995, August 30, 1996, April 4, 1997, April 25, 1997, July 30, 1997, August 25, 1997, December 15, 1998, September 22, 1999, March 9, 2000, May 17, 2000, May 23, 2000 and August 15, 2000, violations of 326 IAC 5-1-2.

7. Respondent installed permanent steam nozzle control system devices into flux chutes to BOF Vessel Nos.1 and 2 in July, 1997, and November, 1997, respectively. The steam rings were installed for the purpose of reducing emissions from the flux chutes during oxygen blowing, the primary source of emissions from the BOF roof monitor.

8. An inspector from IDEM observed visible emissions from the Respondent's iron beaching pits exceed an average of forty percent (40%) opacity in twenty-four (24) consecutive readings while conducting an inspection on February 18, 1997, violations of 326 IAC 5-1-2.

9. Respondent installed a CO₂ suppression system at each of its three (3) iron beaching pits for the purpose of controlling emissions generated when torpedo ladle cars are beached. The system, utilizing Air Liquide Emissions Control Technology (ALECT^TM), purges O₂ from the hooded beaching pit, thereby reducing the formation of the reddish-brown iron oxide emissions.

10. Rule 326 IAC 7-4-14 and 326 IAC 7-1-21 (EPA-approved SIP citation) requires that the emission rate of sulfur dioxide from the Respondent's 160-inch plate mill furnace stack not exceed 1.96 pounds per million Btu (lbs./MMbtu).

11. Respondent conducted a stack test of its 160-inch plate mill furnace stack on September 8, 1998, for the purpose of determining compliance with 326 IAC 7-4-14. That test calculated the emission rate of sulfur dioxide to be 2.06 lbs./MMbtu, a violation of 326 IAC 7-4-14 and 326 IAC 7-1-21 (EPA-approved SIP citation).

12. Respondent conducted a stack test of its 160-inch plate mill furnace stack on October 27, 1998, for the purpose of determining compliance with 326 IAC 7-4-14. That test calculated emission rates of sulfur dioxide to be approximately 1.3 lbs./MMBTU, in compliance with 326 IAC 7-4-14 and 326 IAC 7-1-21 (EPA-approved SIP citation).

13. Rule 326 IAC 6-6-4 requires that the Respondent's particulate matter emission rate of its sinter plant dedusting baghouse not exceed 42.9 pounds per hour.

14. Respondent conducted a stack test of its sinter plant dedusting baghouse on November 17, 1998, for the purpose of determining compliance with 326 IAC 6-6-4. That test calculated the average measured particulate matter emission rate to be 54.61 pounds per hour, a violation of 326 IAC 6-6-4.

15. Respondent conducted a stack test of its sinter plant dedusting baghouse on January 28, 1999, for the purpose of determining compliance with 326 IAC 6-6-4. That test calculated the average measured particulate matter emission rate to be 11.59 pounds per hour, in compliance with 326 IAC 6-6-4.

16. IDEM issued Operation Permits to the Respondent on January 25, 1989, that require particulate emissions to be controlled by baghouses at the following locations:

Permit No. Location

1. 64-01-93-0226 BOF Shop, Track Hopper Building

• 64-01-93-0227 BOF Shop, Conveyor Junction H1
• 64-01-93-0228 BOF Shop, Conveyor Junction H2
• 64-01-93-0229 BOF Shop, No.1 Vessel Storage Bins
• 64-01-93-0230 BOF Shop, No.2 Vessel Storage Bins
• 64-01-93-0231 BOF Shop, No.1 Vessel Weigh Hopper
• 64-01-93-0232 BOF Shop, No.2 Vessel Weigh Hopper
• 64-01-93-0233 BOF Shop, No.3 Vessel Weigh Hopper

17. An inspector from IDEM, while conducting an inspection on October 23, 1995, observed that baghouses referenced in Paragraph 16 above were either not present or were not operational. Failure to control particulate emissions with baghouses at those locations are violations of the Respondent's respective Operation Permits.

18. Respondent informed IDEM, in a memorandum dated February 25, 1998, that installation of baghouses at all locations described in Paragraph 16 above was completed on July 5, 1996.

19. In recognition of the settlement reached, Respondent waives any right to administrative and judicial review of this Agreed Order.

II. ORDER

1. This Agreed Order shall be effective ("Effective Date") on October 1, 2000. This Agreed Order shall have no force or effect until the Effective Date.

2. Starting on the Effective Date of this Order, Respondent shall provide certified visible emission reader(s) to self-monitor its BOF roof monitor for compliance with 326 IAC 5-1-2. Observations shall be made at least forty (40) hours per month including at least ten (10) hours per week, but not more than 6 hours or less than 4 hours on any one day. If the monitoring data shows six (6) consecutive months of greater than 95% compliance with the opacity standards as determined under paragraph 3(b) below, the frequency of monitoring shall be reduced to thirty-two (32) hours per month including at least eight (8) hours per week but not more than 4 hours on any one day. If the monitoring data of any subsequent month shows less than 95% compliance with the opacity standard, the frequency shall return to at least forty (40) hours per month including at least ten (10) hours per week, but not more than six (6) hours or less than four (4) hours on any one day. Any observations under this paragraph shall be conducted when at least one of the steel-making processes in the BOF shop is operating. Such observations shall be made according to U.S. EPA Reference Method 9. Within thirty (30) days after the end of each calendar quarter, Respondent shall calculate, summarize, and submit to the Office of Air Management, Compliance Branch, a report that contains: (1) the dates of readings taken in that quarter, (2) the total length of reading time for each date, (3) the highest six- (6) minute average reading for each date, (4) the number of six-minute averages over 40% opacity on that date, and (5) the percent compliance, as determined in paragraph 3(b) below, for each month. All six-minute average readings will be based on block averages, beginning with the first block of six-minute readings on any given day. Respondent will maintain copies of individual visible emissions evaluations required by this Order for a period of three (3) years, which will be made available to IDEM upon request. IDEM has the right to Quality Assure the visible emissions monitoring program to ensure compliance with Method 9.

3. (a) For the monitoring required by Paragraph 2, Respondent is subject to the following standard:

(i) Opacity shall not exceed an average of forty percent (40%) in

any one (1) six- (6) minute block averaging period.

Emissions temporarily exceeding the standards and which meet the applicable definitions and requirements of malfunction or emergency shall not be included in the calculation of percentage compliance.

Respondent shall include in the report required under paragraph 2 information documenting the malfunction or emergency status of each six- (6) minute block average excluded from the calculation.

(b) The following formula shall be used for the purpose of calculating the monthly compliance percentage for the standard set forth above, as used in this Order:

Percentage Compliance =

[(Number of six-minute block averages observed during the calendar month -

Number of six-minute block averages exceeding the standard for the month)÷

(Number of six-minute block averages observed during the calendar month)]

X 100

The Percentage Compliance will be calculated by rounding to the next highest whole unit digit, except where the calculation determines a percentage of .4% or less above a whole unit digit, in which case the Percentage Compliance will be rounded down to the next lowest whole unit digit.

4. If for any calendar quarter, Respondent fails to submit the report required by Paragraph 2 above, Respondent shall pay a stipulated penalty of One Thousand Dollars ($1,000.00) for each day that the Respondent fails to submit the required report after the required submittal date.

5. If Respondent fails to conduct the appropriate monitoring required by Paragraph 2 above, Respondent shall pay a stipulated penalty of Five Hundred Dollars ($500.00) for each hour below the required number of hours that Respondent fails to monitor in a month.

6. In any calendar month in which the percentage compliance calculated pursuant to paragraph 3 is less than 95 percent, Respondent shall pay a stipulated penalty of Ten Thousand Dollars ($10,000).

7. If for any calendar month the percentage compliance calculated using the formula in Paragraph 3(b) above shows less than 95% compliance with the opacity standard, Respondent shall immediately investigate the cause(s) of the exceedances and, within ninety (90) days of the calendar month having the exceedance, develop a work plan that will mitigate the roof monitor emissions. The work plan required under this paragraph shall be submitted to IDEM no later than the ninetieth (90^th) day after the calendar month having the exceedance. Respondent shall complete implementation of the work plan within one hundred twenty (120) days after the end of the calendar month having the exceedance. Respondent shall pay a daily stipulated penalty of One Thousand Dollars ($1,000.00) for each day that the Respondent fails to submit and/or implement the work plan after the required submittal and/or implementation date. If the steps identified in the work plan required by this paragraph require more than the aforementioned one hundred twenty (120)-day period to implement, Respondent may petition the Office of Enforcement for an extension of the date (120 days) when the work plan must be completely implemented.

8. If after Respondent completes implementation of the work plan in Paragraph 7 above, Respondent documents exceedances for any two months prior to the termination of this Agreed Order, each showing less than 95% compliance with the opacity standard during the period of self-monitoring, Respondent shall be required to implement one of the following requirements:

• Within one hundred eighty (180) days of the calendar month described above, Respondent shall close all roof monitors, building openings, vents, windows, louvers, and any other openings in the area near and above the BOF vessels from which particulate matter could be emitted. The resultant enclosed area above the BOF vessels shall be vented to a baghouse, high-energy venturi scrubber, or electrostatic precipitator; or

• Initiate a study into either: i) making process modifications, or ii) installing pollution control equipment sufficient to achieve compliance with all applicable rules and regulations. The study shall be submitted to IDEM within one hundred eighty (180) days of triggering this paragraph. IDEM shall provide written comments to Respondent within forty-five (45) days of receipt of the study.

Within one hundred eighty (180) days of receiving comments from IDEM, Respondent shall submit to IDEM a firm detailed engineering estimate with complete drawings and specifications of the process modifications or pollution control equipment to be installed on Respondent's BOF. Respondent shall complete construction and installation of the pollution control equipment within twenty-two (22) months after submitting the detailed engineering estimate to IDEM as required above.

9. Respondent shall notify IDEM in writing within fifteen (15) days of the calendar month defined in Paragraph 8 which triggers the requirements in 8(a) or 8(b) above which of the two requirements, 8(a) or 8(b), it shall undertake. Respondent shall pay a stipulated penalty of One Thousand Dollars ($1,000.00) for each day that Respondent fails to submit the notification required by this Paragraph.

10. The sole purposes of the 95% compliance level are to determine Respondent's observation frequency as set forth in paragraph two (2) above, whether a work plan or implementation plan is required as set forth in Paragraphs seven (7) or eight (8), respectively, and to establish penalties under paragraph 6.

11. "Force Majeure", for purposes of this Agreed Order, is defined as any event arising from causes beyond the control of the Respondent that delays or prevents the performance of any obligation under this Agreed Order despite Respondent's best efforts to fulfill the obligation. The requirement that the Respondent exercise "best efforts to fulfill the obligation" includes using best efforts to anticipate any potential force majeure event and best efforts to address the effects of any potential force majeure event (1) as it is occurring and (2) following the potential force majeure event, such that the delay is minimized to the greatest extent possible. "Force Majeure" does not include financial inability to complete the work required by this Agreed Order or increases in costs to perform the work.

12. The Respondent shall notify IDEM by calling within three (3) calendar days and by writing no later than seven (7) calendar days after any event which the Respondent contends is a force majeure. Such notification shall describe the anticipated length of the delay, the cause or causes of the delay, the measures taken or to be taken by the Respondent to minimize the delay, and the timetable by which these measures will be implemented. The Respondent shall include with any notice all available documentation supporting its claim that the delay was attributable to a force majeure. Failure to comply with the above requirements shall preclude Respondent from asserting any claim of force majeure for that event. The Respondent shall have the burden of demonstrating that the event is a force majeure. The decision of whether an event is a force majeure shall be made by IDEM. Said decision shall be communicated to the Respondent as soon as reasonably possible but no longer than thirty (30) calendar days after receiving Respondent's written submission.

13. If a delay is attributable to a force majeure, IDEM shall extend, in writing, the time period for performance under this Agreed Order, by the amount of time that is attributable to the event constituting the force majeure.

14. All submittals required by this Agreed Order, unless notified otherwise in writing, shall be sent to:

To IDEM:

Eric Larsen, Environmental Engineer

Office of Enforcement, Air Section

Indiana Department of Environmental Management

100 N. Senate Avenue

P.O. Box 6015

Indianapolis, IN 46206-6015

To Bethlehem Steel:

David E. Tomlinson, Esquire Robert A. Maciel, Superintendent

Bethlehem Steel Corporation Burns Harbor Division

Rm. 2091 M.T. Bethlehem Steel Corporation

1170 8th Avenue P.O. Box 248

Bethlehem, Pennsylvania 18016-7699 Chesterton, Indiana 46304

15. Respondent is assessed a civil penalty of Three Hundred Seventy-Nine Thousand Five Hundred Dollars ($379,500). Respondent shall pay that amount in four equal quarterly installments of Ninety-Four Thousand Eight Hundred Seventy-Five Dollars ($94,875) to the Environmental Management Special Fund with installments due within 30, 120, 210, and 300 days of the Effective Date of this Agreed Order.

16. Civil penalties are payable by check to the Environmental Management Special Fund. Checks shall include the Cause Number A-3460 of this action and shall be mailed to:

Cashier

IDEM

100 N. Senate Avenue

P. O. Box 7060

Indianapolis, IN 46207-7060

Although the check will reference only Cause Number A-3460 on its face, the parties agree that such checks are to satisfy the civil penalty portion of all violations noted in Section I , Findings of Fact, of this Agreed Order.

17. In the event that any installment amount required by paragraph fifteen (15) is not paid within the time frame prescribed in Paragraph 15 above, Respondent shall pay interest on the unpaid installment at the rate established by IC 24-4.6-1-101. The interest shall continue to accrue until the installment is paid in full.

• Stipulated penalties shall be due and payable within thirty (30) days after Respondent receives written notice that the Complainant has determined a stipulated penalty is due. Assessment and payment of stipulated penalties shall preclude the Complainant from seeking any additional monetary relief against the Respondent for violation of the Agreed Order. Assessment and payment of a stipulated penalty shall not preclude the Complainant from seeking or obtaining any injunctive relief against Respondent for violation of this Agreed Order. In lieu of any of the stipulated penalties given above, the Complainant may seek any other remedies or sanctions available by virtue of Respondent's violation of this Agreed Order, or Indiana law, including but not limited to civil penalties pursuant to IC 13-30-4, and permit revocation pursuant to IC 13-15-17 and 326 IAC 2.

19. The deadline for any activity under this Agreed Order, including without limitation the deadlines for submitting any reports or studies will be automatically extended to the next business day if the deadline otherwise calculated under this Agreed Order falls on a weekend or holiday.

20. This Agreed Order shall apply to and be binding upon the Respondent, successors, and assigns. The Respondent's signatories to this Agreed Order certify that they are fully authorized to execute this document and legally bind the parties they represent. No change in ownership, corporate, or partnership status of the Respondent shall in any way alter its status or responsibilities under this Agreed Order.

21. In the event that any terms of the Agreed Order are found to be invalid, the remaining terms shall remain in full force and effect and shall be construed and enforced as if the Agreed Order did not contain the invalid terms.

22. The Respondent shall provide a copy of this Agreed Order, if in force, to any subsequent owners or successors before ownership rights are transferred.

23. This Agreed Order, and compliance with its terms, shall constitute full resolution of this enforcement action for all violations noted in Section I, Findings of Fact, of this Agreed Order.

24. This Agreed Order shall terminate two years after its effective date or when the maximum available control technology (MACT) national emission standard for hazardous air pollutants (NESHAP) for the source category Iron and Steel - BOF Shops becomes effective for the Bethlehem Steel, Burns Harbor Division, BOF Shop, whichever is earlier, unless a requirement set out in paragraph 8 is triggered. If the requirements set out in paragraph 8 are triggered, this Agreed Order shall terminate at the earlier of when the actions required by paragraph 8 have been implemented and the percentage compliance calculated under paragraph 3(b) is 95 percent or greater for twelve (12) consecutive months, or when a MACT NESHAP for the source category Iron and Steel - BOF Shops becomes effective for the Bethlehem Steel, Burns Harbor Division, BOF Shop.

TECHNICAL RECOMMENDATION: BETHLEHEM STEEL CORPORATION,

Department of Environmental Management BURNS HARBOR DIVISION:

By: _________________________ By: _________________________

David P. McIver

Air Section Chief

Office of Enforcement Printed: ______________________

Title: ________________________

Date: ________________________ Date: ________________________

COUNSEL FOR COMPLAINANT: COUNSEL FOR RESPONDENT:

Department of Environmental Management

By: _________________________ By: ________________________

Office of Legal Counsel

Department of Environmental Management

Date: _______________________ Date: ______________________

APPROVED AND ADOPTED BY THE INDIANA DEPARTMENT OF ENVIRONMENTAL MANAGEMENT THIS _____ DAY OF ____________________, 199___.

For the Commissioner:

Signed on 09/25/2000

Felicia A. Robinson

Assistant Commissioner of Enforcement