PIPES Act of 2016 Enacted, New Regulation Coming for Natural Gas Storage

June 24, 2016 § Leave a comment

The Protecting our Infrastructure of Pipelines and Enhancing Safety Act of 2016, or PIPES Act, reauthorizes the Pipeline and Hazardous Materials Safety Administration’s (PHMSA) oil and gas pipeline programs through 2019.  Like every version, every four years, the reauthorization includes new mandates for the agency.


The 2016 reauthorization requires that PHMSA develop national regulations for the construction and operation of underground natural gas storage facilities. That provision is in response to the Aliso Canyon gas leak in southern California.  For those interested in a preview of what is to come for storage, PHMSA has an upcoming workshop on July 14, 2016 that is certain to give us a roadmap.  See: PHMSA WORKSHOP DETAILS


#Pipeline Safety Act Reauthorization Process Begins

November 19, 2015 § Leave a comment

It’s reauthorization time again. Every 4 years, chapter 49 of the code of federal regulations governing pipeline safety comes up for review. This includes authorization of appropriations to fund the Pipeline and Hazardous Materials Safety Administration (PHMSA) and reauthorization of agency’s mandate to promulgate and enforce pipeline safety regulations. The last version, currently in effect, is the the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011. (Note: Many regulations passed in that time frame included the phrase “job creation.” The regulations certainly did not foster job growth. Given the Obama administration’s stance against building more infrastructure, exploration, and exporting, there can be no claim of job creation in 2015…the only jobs expanding are government inspectors.)

The new bill, titled ‘‘Securing America’s Future Energy: Protecting our Infrastructure of Pipelines and Enhancing Safety Act’’ or the ‘‘SAFE PIPES Act’’ was introduced Senators Deb Fischer (NE) and Cory Booker (NJ). As expected, the focus is on aging infrastructure, review (and expansion) of integrity management and security. In the area of environmental protection, the bill would amend the regulations to explicitly state that the Great Lakes are a USA ecological resource (as defined in section 195.6(b)) for purposes of determining whether a pipeline is in a high consequence area. The bill would also streamline hiring practices for PHMSA to fast track bringing on more inspectors. Read the full bill here.

Well said, @API_News.

October 18, 2015 § Leave a comment

In the wake of Obama administration decision to cancel 2016 and 2017 Arctic oil lease sales, API statement is well focused on cause and effect–the administration’s untenable regulatory uncertainty leading to reluctant investment.  http://www.api.org/News-and-Media/News/NewsItems/2015/October-2015/API-statement-on-admin-cancellation-of-arctic-lease-sales.

Major Changes Proposed for Hazardous Liquids Pipelines Integrity Management

October 14, 2015 § Leave a comment

The Pipeline and Hazardous Materials Safety Administration (PHMSA) has proposed expansion of the current Integrity Management rules to include previously unregulated pipelines.  As forecasted here, gathering lines are among the expanded reach.

PHMSA’s Notice of Proposed Rulemaking (NPRM) is one of PHMSA’s most significant rulemakings to date, and if finalized, will result in a huge resource burden to the industry; unwelcome news during this challenging economic environment for the industry.

Some of the more significant new proposed requirements would change 49 CFR 195 to include the following:

  • Extending certain Integrity Management assessment and repair requirements to all pipelines, rather than those in high consequence areas (HCAs). PHMSA proposes to require pipeline segments not currently subject to the Integrity Management  regulations to be assessed by in-line inspections (ILI) at least once every 10 years, regardless of the proximity to high consequence areas (HCAs).
  • Limiting assessment methods other than ILI on non-HCA pipelines with notice including a technical demonstration that the pipeline is not capable of accommodating an ILI tool.
  • Changing the applicability of pipeline repair criteria to expand the list of conditions that require immediate remediation and to consolidate the timeframes for remediating all other conditions, and to apply these repair criteria to pipelines that are not subject to Integrity Management requirements, with an adjusted schedule for performing non-immediate repairs.
  • Modifying current Integrity Management repair criteria to encompass new conditions to be treated as “immediate repair conditions,” including bottom-side dents with stress risers; a calculation of remaining strength that shows a predicted burst pressure less than 1.1 times maximum operating pressure; any indication of significant stress corrosion cracking; and any indication of selective seam weld corrosion.
  • Eliminating current 60-day and 180-day repair categories, and would establish a new, consolidated 270-day repair category for ‘non-immediate’ repairs.
  • PHMSA proposes to specify that the immediate repair criteria in Part 195.452(h) are applicable to non-Integrity Management repairs and to establish an 18-month repair category.
  • Amending Part 195 to include a general requirement for performing all other repairs within a reasonable time.
  • Requiring any pipeline that could affect a HCA to be upgraded in order to accommodate ILI tools within 20 years, unless the basic construction of the pipeline would not accommodate the passage of such devices. Under current regulations, new pipelines and each line section of a pipeline where the line pipe, valve, fitting, or other line component is replaced must be designed and constructed to accommodate the passage of ILI devices, with certain exceptions.
  • Expanding the use of leak detection systems. PHMSA proposes to require all new hazardous liquid pipelines (not just those that could impact a HCA) to be designed to include leak detection systems and to evaluate the kind of system required to adequately protect the public, property and the environment.
  • Requiring Operators of all new liquid pipelines to evaluate and modify, as necessary, the capability of their leak detection systems to protect the public, property, and the environment.
  • Extending reporting requirements to certain unregulated lines, including all liquid gathering lines to require operators of all liquid gravity and gathering lines to submit annual, safety-related condition, and incident reports.
  • Requiring operators to inspect pipeline facilities potentially affected by an extreme weather event such as a hurricane or flood, an earthquake, a natural disaster, or other similar event within 72 hours after the cessation of the event, to ensure that no conditions exist that could adversely affect the pipeline and take appropriate remedial actions, which may include pressure reductions or shutdown in certain cases;
  • Requiring that operators of a new pipeline to develop a written Integrity Management program before the pipeline begins operation rather than one year after commissioning as current regulations require;
  • Specifying certain pipeline attributes that must be included in the information analysis required under the Integrity Management rule and requiring that operators identify any spatial relationship among anomalous information;
  • Requiring that operators verify the identification of segments subject to Integrity Management requirements annually; and
  • Clarifying that IM requirements apply to components of pipeline systems beyond line pipe, such as pump stations and breakout tanks.

Comments are due by January 8, 2016, and industry push-back is expected.

PHMSA Issues Pipeline Damage Prevention Final Rule

July 16, 2015 § Leave a comment

Excavation damage by third-parties has resulted in 757 injuries and $545 million in property damage from 1,815 pipeline incidents between 1988 and 2014   As the Pipeline and Hazardous Materials Safety Administration (PHMSA) has concluded that “[e]xcavation damage poses by far the single greatest threat to distribution system safety, reliability, and integrity.”  Often the responsible parties have faced little or no enforcement, because damage prevention has been handled by the states and not the federal government.  Some states have chosen to allow numerous exemptions to the damage prevention laws; in some cases protecting the most frequent parties causing the damage to pipelines.  State practices have been inconsistent, with many states lacking the resources for robust enforcement of their damage prevention statutes.

This long-awaited final rule may begin to resolve this problem. Although the process is expected to take some time to roll out, PHMSA’s evaluation of state programs should lead to increased enforcement against excavators who fail to use the one-call system and penalize states with cuts to grant funding for failure to adequately protect underground facilities through comprehensive damage prevention programs. The PIPES Act of 2006 directed PHMSA to develop criteria to evaluate the adequacy of state damage prevention programs and authorized PHMSA to civil enforcement action against excavators who violate safety requirements.

The final rule, announced July 15, amends the Federal pipeline safety regulations to establish the following:

  • The criteria and procedures PHMSA will use to determine the adequacy of State pipeline excavation damage prevention law enforcement programs;
  • The administrative process for States to contest notices of inadequacy from PHMSA should they elect to do so;
  • The Federal requirements PHMSA will enforce against excavators for violations in States with inadequate excavation damage prevention law enforcement programs; and
  • The adjudication process for administrative enforcement proceedings against excavators where Federal authority is exercised.

The criteria PHMSA will use to evaluate the adequacy of State damage prevention law enforcement programs, listed in § 198.55 are:

1) Does the State have the authority to enforce its State excavation damage prevention law using civil penalties and other appropriate sanctions for violations?

2)  Has the State designated a State agency or other body as the authority responsible for enforcement of the State excavation damage prevention law?

3)  Is the State assessing civil penalties and other appropriate sanctions for violations at levels sufficient to deter noncompliance and is the State making publicly available information that demonstrates the effectiveness of the State’s enforcement program?

4)  Does the enforcement authority (if one exists) have a reliable mechanism (e.g., mandatory reporting, complaint-driven reporting) for learning about excavation damage to underground facilities?

5)  Does the State employ excavation damage investigation practices that are adequate to determine the responsible party or parties when excavation damage to underground facilities occurs?

6)  At a minimum, do the State’s excavation damage prevention requirements include the following:

A.    Excavators may not engage in excavation activity without first using an available one-call notification system to establish the location of underground facilities in the excavation area.

B.    Excavators may not engage in excavation activity in disregard of the marked location of a pipeline facility as established by a pipeline operator

C    An excavator who causes damage to a pipeline facility

  1. Must report the damage to the operator of the facility at the earliest
  2. practical moment following discovery of the damage; and
  3. If the damage results in the escape of any PHMSA regulated natural and other gas or hazardous liquid, must promptly report to other appropriate authorities by calling the 911 emergency telephone number or another emergency telephone number.

7)  Does the State limit exemptions for excavators from its excavation damage prevention law? A State must provide to PHMSA a written justification for any exemptions for excavators from State damage prevention requirements. PHMSA will make the written justifications available to the public.

PHMSA’s evaluation will involve all of the criteria, and the final determination will be based on the totality of the review. PHMSA may declare a State enforcement program inadequate if the State’s program does not satisfy a combination of the criteria as described above. PHMSA will notify in writing the Governor’s office or other appropriate State authority of a State deemed to have an inadequate enforcement program.  States that PHMSA deems to have inadequate enforcement programs may be subject to reductions in pipeline safety grant funding. PHMSA will use the existing process for calculating base grants but is considering a policy that would incorporate and/or substitute the evaluation criteria in § 198.55 for the criteria that are currently used for evaluating State damage prevention programs.

PHMSA will generally to take actions on more serious cases where state enforcement is lacking.  Hopefully, the federal evaluation will result in increased enforcement by states, including elimination of exemptions to the one-call regulations.

READ MORE of the rulemaking proposal transmitted by PHMSA to the Federal Register is on the agency’s website.

PHMSA Notice of Proposed Rulemaking: Expanding Use of Excess Flow Valves

July 11, 2015 § Leave a comment

PHMSA issued a Notice of Proposed Rulemaking (NPRM) to expand the use of Excess Flow Valves (EFVs), which are safety devices installed on natural gas pipelines to reduce the risk of accidents.  EFVs are currently required for new or replaced gas service lines servicing single-family residences (SFR) as defined in §192.383(a). PHMSA is proposing to make changes to Part 192 to expand this requirement to include new or replaced branched service lines servicing SFRs, multi-family residences, and small commercial entities consuming gas volumes not exceeding 1,000 Standard Cubic Feet per Hour (SCFH). PHMSA is also proposing to require the use of manual service line shut-off valve (e.g., curb valves) for new or replaced service lines with meter capacities exceeding 1,000 SCFH. Finally, PHMSA is proposing that operators notify customers of their right to request installation of an EFV on service lines that are not being newly installed or replaced. PHMSA is proposing to delegate the question of who bears the cost of installing EFVs to service lines that are not being newly installed or replaced to the operator, customer, and the appropriate State regulatory agency. The notice was transmitted to the Federal Register, which publishes the official NPRM.  Comments to the proposed rules are due 60 days after the NPRM is published in the federal register.

See more on PHMSA website here.

ANSI/API RP 1173 Released

July 8, 2015 § Leave a comment

On July 8, 2015, the American Petroleum Institute (API) released the much anticipated pipeline safety management system standard, RP 1173. Development of the standard arose from 2012 NTSB’s recommendation following the 2010 oil pipeline accident in Marshall, Michigan. The new standard was issued in draft form for public comment in early 2014 and the final version is the result of significant input from PHMSA, industry and NTSB.  RP 1173 focuses on a process-oriented approach to safety in a continual improvement cycle.  PHMSA does not intend to incorporate the standard into the pipeline safety regulations at this time.

Texas Railroad Commission Chairman on Effect of Export Ban on Jobs

July 8, 2015 § Leave a comment

Texas Railroad Commission Chairman David Porter @DavidPorterRRC testified before the U.S. Agriculture Committee on July 8, 2015 on the urgency of lifting the federal ban on crude oil exports. His testimony stressed the link between lifting the ban on crude exports and economic growth.  Chairman Porter spoke passionately about the economic impacts of the recent downturn in oil prices in Texas; resulting in mass layoffs and losses in state revenues that support key infrastructure.

Chairman Porter also stated that the crude oil export ban is responsible for the disparity between West Texas Intermediate (WTI), the U.S. pricing benchmark for crude – and the international benchmark, Brent.

For more information, read his full testimony.

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