Does a facility automatically lose eligibility for the option for qualified oil-filled operational equipment if the equipment has an oil discharge?

No.  Facilities that choose this alternative and later have a reportable oil discharge from qualified oil-filled operational equipment do not automatically lose eligibility.  However, the spill reporting requirements would apply as well as the reporting requirements in the SPCC Rule.  After receiving a report of an oil discharge, the EPA Regional Administrator may determine whether the facility must amend its SPCC Plan and have it certified by a Professional Engineer (PE).  Facilities that are required to amend their SPCC Plan may lose their eligibility for this alternative, unless they can demonstrate that secondary containment is impracticable. 

For more information on spill reporting, see the "Oil Discharge Reporting Requirements" Fact Sheet or refer to the SPCC Rule and the Discharge of Oil regulation, 40 CFR part 110.