Pipeline Law

Pipeline Law

Welcome to the Underground

Lawyers with the Hunton & Williams LLP Pipeline Practice group have been providing legal support to America’s oil and gas pipeline industry for a quarter century. During that time, they have gained extensive experience on a wide variety of issues of concern to the industry, the regulatory agencies and the public. Hunton & Williams’ pipeline group also has extensive geographical reach in this practice area, with matters in almost all 50 states. Our goal is to help solve problems, not prolong them, and our experience helps to achieve timely resolution.

FERC Implements New Cost Recovery Policy for Gas Facility Modifications

Posted in Construction & Design, PHMSA, Pipeline Safety Act, Policy

Effective October 1, 2015, the Federal Energy Regulatory Commission (FERC) will allow interstate natural gas pipelines to seek to recover certain capital expenditures involving changes to pipeline system infrastructure that enhance system reliability, safety and regulatory compliance.  In a Policy Statement issued on April 16, 2015, FERC provided guidance on how it will evaluate such cost recovery proposals.  The intent is to encourage replacement of old and inefficient pipelines or pipeline components, such as compressors, to enhance the safe operation of pipeline systems.
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Crude by Rail Developments

Posted in Administrative Guidance, Environmental, Federal/ State Legislation, PHMSA, Policy

In response to recent crude by rail incidents in the United States and Canada, Congress, PHMSA, NTSB, the Federal Railroad Administration (FRA), and even some railroads have proposed improvements in safety standards for trains transporting crude oil.  PHMSA originally planned to issue new tank car safety standards and regulations for the phase-out of older tank cars in March, but has since moved that date back to May.  Due to that delay and the continued occurrence of rail incidents, Congress and the NTSB have called for PHMSA to establish improved safety standards, some of which exceed the standards in the Agency’s current proposal (discussed below).  In response, DOT (through PHMSA and FRA, the agencies charged with regulating rail safety) announced three Safety Advisories and one Emergency Order on April 17, 2015, all intended to address specific issues identified in recent train accidents involving crude oil and ethanol shipper by rail. The Safety Advisories are directed at both shippers and rail carriers, and cover topics such as emergency response information accident investigations, and mechanical inspection and detection issues.  The Emergency Order requires “affected trains,” defined to include those containing at least one DOT-111 tank car and transporting large amounts of Class 3 flammable liquids in a continuous block, to adhere to a maximum operating speed limit of 40 miles per hour through highly populated areas.

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PHMSA Considering Integrity Verification Process for Liquid Pipelines & Report on Repair/Replace of Pre-Code Pipelines

Posted in Integrity Management, PHMSA, Pipeline Safety Act, Policy

After briefing the industry on the initiative in November 2014, PHMSA initiated a rulemaking docket to consider establishing an Integrity Verification Process (IVP) for hazardous liquid pipelines.  A similar process is already underway with respect to natural gas pipelines as required by the 2011 Congressional amendments to the Pipeline Safety Act (see prior pipelinelaw alerts).  The liquid IVP would apply to:  (1) pipelines, including rural gathering lines, located in high consequence areas, (2) pipelines that could affect right-of-ways of various types of roadways; (3) highly volatile liquid pipelines; and (4) any other pipeline with a maximum operating pressure (MOP) of greater than 20% specified minimum yield strength (SMYS).   The IVP would include verification of MOP and material records, pressure testing and material verification where records do not exist, re-evaluation where a risk-based alternative is used in lieu of pressure testing and fatigue analysis to determine reassessment intervals for integrity issues associated with cracking.  PHMSA prepared a detailed flow chart to outline the proposed process.

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PHMSA Announces Public Workshop on Safety Management Systems

Posted in Operation & Maintenance, PHMSA, Policy

The Agency announced a public workshop to discuss the voluntary Pipeline Safety Management Systems (SMS) national consensus standard on April 22, 2015 in Houston, Texas.  This standard, Recommended Practice (RP) 1173, has been in development by the American Petroleum Institute (API) for some time now as a result of the NTSB’s Investigation of the Marshall, Michigan incident.  The NTSB found that Enbridge’s centralized safety management system was deficient and made a recommendation to API to develop a safety management standard specific to pipelines.  RP 1173 is still under development, but is expected to be published this year.

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Advisory Regarding Damage to Pipelines from Flooding

Posted in Administrative Guidance, Incident Response, Integrity Management, Operation & Maintenance, PHMSA, Public Awareness/ Community Relations

PHMSA issued an updated advisory regarding the potential for damage to pipeline facilities caused by severe flooding.  Presumably prompted by the January 2015 release to the Yellowstone river in Glendive, Montana, associated with an area of exposed pipeline on the river bottom, the Agency reiterated the nine (9) actions it has set forth in prior advisories to prevent and mitigate damage to pipelines impacted by flooding.  See e.g., Advisory, 76 FR 44985 (Jul. 27, 2011); see also prior pipelinelaw alert regarding the same.  Notably, PHMSA adds the following five (5) additional actions to its previous list:  Continue Reading

PHMSA Final Rule Amends Numerous Pipeline Safety Regulations

Posted in Administrative Rulemaking, Construction & Design, Integrity Management, Operation & Maintenance, PHMSA, Pipeline Safety Act, Policy, Reporting Obligations

PHMSA issued a Final Rule that amends various Part 195 and 192 regulations relating to post-construction inspections, welding, gas component pressure testing requirements, and calculating pressure reductions for immediate repairs on liquid pipelines, among other changes.  The topics addressed in the Final Rule were first raised in a 2011 Notice of Proposed Rulemaking (NPRM) in response to rulemaking petitions and comments filed by industry groups and other pipeline organizations.  Of the 16 rule changes proposed by the Agency in 2011, this Final Rule codifies 6 as proposed, modifies 7 in response to industry comments, and withdraws 3 for further consideration.

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NTSB Issues Safety Study Critical of PHMSA Gas Integrity Management Program

Posted in Integrity Management, PHMSA, Pipeline Safety Act, Policy

The National Transportation Safety Board (NTSB or the Board) recently released a Safety Study on the need for safety improvements to the natural gas Integrity Management Program (IMP).  The Board concluded that there is no evidence that the occurrence of gas transmission pipeline incidents in highly populated areas have declined since implementation of IMP rules, and that incidents attributed to causes other than corrosion and material defects have increased from 2010 to 2013.  The NTSB also found that the intrastate incident rate in these highly populated areas, called high consequence areas or HCAs, from 2010 to 2013 was significantly higher as compared to interstate transmission lines (27% higher per every 1,000 miles).  Further, despite the emphasis in the IMP regulations on time dependent threats such as corrosion, gas transmission incidents associated with corrosion continue to disproportionately occur on pre-1970 pipelines.

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PHMSA-Sponsored Publications Provide Planning Tools for Hazard Mitigation and Emergency Response

Posted in Administrative Guidance, Incident Response, PHMSA, Public Awareness/ Community Relations

Two recent PHMSA-sponsored publications emphasize stakeholder advance planning as key to reducing the likelihood and consequences of pipeline incidents.  The first, a Guide for Communicating Emergency Response Information for Natural Gas and Hazardous Liquids Pipelines, was published in 2014 by the Transportation Research Board (TRB) under contract with PHMSA as a resource on pre-incident information sharing between pipeline operators and emergency response planners.  The second, Hazard Mitigation Planning: Practices for Land Use Planning and Development Near Pipelines, was prepared in 2015 by the Pipeline and Informed Planning Alliance (PIPA) and sponsored by PHMSA and the Federal Emergency Management Agency (FEMA) as a guide for State and local governments in considering hazard mitigation strategies for proposed land development near existing gas and hazardous liquid transmission pipelines.  Both guidance documents emphasize the importance of stakeholders using available resources to understand the potential impacts of a pipeline incident and working collaboratively to minimize those impacts.

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Pipeline Law 2015: The Year Of Living Uncertainly

Posted in Administrative Rulemaking, Enforcement, PHMSA, Pipeline Safety Act

The US oil and gas industry has been transformed over the past few years by development of new shale resources.  The US is now the world’s largest producer of natural gas and on track to be the world’s largest producer of oil.  These changes have affected America’s energy future, as well as global markets.  With so much new production on the market, and continuing economic stagnation in Europe and China reducing demand, the global price of oil dropped dramatically in the last half of 2014.  As Pulitzer Prize-winning analyst Daniel Yergin observed recently, America has now unexpectedly replaced OPEC as the world’s “swing producer” of oil and gas.  As a result, US oil and gas producers must now make new decisions about investment, production and rate of return ratios.  Against this backdrop, there are, as always, many other issues that will affect decisions and the market landscape.

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EPA Proposes New Standards for Use of Dispersants Under the National Contingency Plan

Posted in Administrative Rulemaking, Environmental, Incident Response

EPA has proposed to revise requirements under the National Oil and Hazardous Substance Contingency Plan (NCP) to address concerns raised during the Deepwater Horizon oil spill pertaining to the use of dispersants and other spill mitigating products.  Specifically, the proposed revisions address concerns relating to NCP standards for the efficacy, toxicity, and environmental monitoring of dispersants.

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