Is “dispersal of inventory” an accepted method to maintain inventories BELOW PSM/RMP Thresholds?

The simple and short answer is YES. In fact, OSHA covers “dispersal of inventory” in their 1994 Compliance Directive: 29 CFR 1910.119, Process Safety Management of Highly Hazardous Chemicals — Compliance Guidelines and Enforcement Procedures. In this directive OSHA asks and answers the following questions regarding “dispersal of inventory”:

1. Can an employer who keeps threshold quantities of highly hazardous chemicals listed in Appendix A to 29 CFR 1910.119, such as ammonia, separated into smaller lots and used and stored in separate systems or locations, be exempt from the requirements of the PSM standard?
2. The PSM standard’s non-mandatory Appendix C suggests that, if reduced inventory of highly hazardous chemicals is not feasible, an employer might consider dispersing inventory to several locations on-site. When are such materials to be considered part of a single process?
3. What evaluation techniques are appropriate to determine adequate separation distances?