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.
PHMSA states that the rule is intended to provide relief to industry by eliminating, clarifying and relaxing certain regulatory requirements. Despite the breadth of the rulemaking topics covered, PHMSA also notes that in general the rule “does not impose any significant compliance, recordkeeping, or reporting requirements.” As set forth in more detail below, however, while some of the changes are minor clarifications and others may not impose substantive compliance obligations, the rule prompted numerous industry comments and requested modifications, and does impose some new stringent compliance requirements in certain areas.
New Rules of General Applicability
Post-Construction Compliance Inspections: PHMSA acknowledges that this was the most controversial proposal in this rulemaking. The Agency originally proposed to revise Parts 192.305 and 195.204 to specify that post-construction compliance inspections must be performed by someone other than the contractors who did the construction. Virtually all pipeline trade groups filed comments expressing concern about the cost and lack of clarity on how this rule would be implemented. The Technical Advisory Committees persuaded PHMSA to modify the rule to clarify that while an operator may not use personnel for inspections of construction tasks that they performed, nothing prohibits personnel from inspecting construction tasks when they are involved in different construction projects/tasks.
National Pipeline Mapping System (NPMS) Submittals: PHMSA amended the regulations to codify the statutory requirement that operators make annual NPMS geospatial data submittals, at 49 C.F.R. Parts 191.29 and 195.61. Neither the rulemaking nor the regulations address the Agency’s recent Notice that contains significantly more substantive new requirements, however, by proposing to greatly expand the information required in those submissions, targeting compliance issues such as abandonment, seam type, MOP/MAOP, gathering lines, historical pressure testing, etc. While the recent Notice was not issued as a substantive rulemaking, it contains much more substantive new requirements than this new final rule.
Welders vs. Welding Operators: The Agency amended several provisions under Parts 192 and 195 to authorize evaluation of welds and welding operators under API 1104 Appendix A in addition to the standards already set forth in the regulations “to be consistent with industry practice.” Welding remains a significant issue in many Agency inspections and enforcement matters, but this amendment does not address any of the concerns noted in those activities.
Offshore pipe condition reports: PHMSA removed requirements under Parts 191.27 and 195.57 for submission of underwater offshore inspections of pipelines in the Gulf of Mexico, noting that existing regulations that require periodic risk-based inspections and reporting of hazards for shallow water pipelines meet the Agency’s information collection needs.
New Rules Applicable to Liquid Lines (Part 195)
Pressure Reductions for Immediate Integrity Anomalies: When liquid operators encounter immediate integrity management repair conditions, they must either temporarily reduce the pipeline pressure or shut down the line until the condition is repaired. Existing regulations specify that a pressure reduction should be calculated based on a formula targeted to address anomalies caused by corrosion (under ASME B31.4). In this new final rule, in order to cover immediate anomalies addressed by corrosion and other threats, PHMSA cross-referenced pressure reduction formulas in ASME B31G and RSTRENG PR-3-80 (already set forth under the regulations for remaining strength calculations which primarily focus on corrosion defects) and added an alternative method where “no suitable remaining strength calculation can be identified,” a minimum 20 percent or greater reduction based on the actual operating pressure for two months prior to the date of inspection.
Transportation of Ethanol by Pipeline: Consistent with a 2007 PHMSA policy statement which recognized that ethanol and biofuels constitute “hazardous liquids for purposes of pipeline safety laws and regulations,” the Agency amended Part 195.2 to include ethanol in the definition of “hazardous liquid.” The Agency declined, however, to add “bio-diesel petroleum” to the definition, noting that it is outside the scope of the rulemaking.
New Rules Applicable to Gas Lines (Part 192)
Alternative MAOP Computations and Notifications: As proposed, the rulemaking revised Part 192.112(e) to increase the internal test pressure for mill hydrostatic tests to 95% SMYS for new pipe installed after October 1, 2015 that will be operated at alternative MAOP. The Agency also amended Part 192.620(c)(1) to require that operators notify PHMSA (and applicable state authorities) of planned alternative MAOP pipelines at least 60 days prior to the start of pipe manufacturing or construction activities in order to allow the Agency time to conduct any necessary manufacturing or construction inspections. The Agency reduced the notice requirement from a proposed 180 days to 60 days in response to industry comments.
Testing Low Pressure Components and Components Fabricated by Welding: To resolve a discrepancy between the testing of components in high pressure and low pressure gas pipelines, PHMSA revised the regulations by adding a general requirement under Part 192.503(e) to clarify that where a component other than pipe is the only item being replaced or added to any pipeline (whether operated at a high or low stress) a post-installation strength test is not required so long as the manufacturer of the component provides the required certifications. In addition, PHMSA revised Part 192.153(e) to specify that all ASME pressure vessels located in compressor stations, meter stations, and other Class 3 and 4 locations, must be pressure tested to a minimum of 1.5 times MAOP, in lieu of the ASME standard of 1.3 times MAOP. Several industry commenters noted that this was a substantial and costly change and inquired whether this requirement would have retroactive application. PHMSA disagreed with commenters and did not address the question of retroactivity.
Other changes enacted by the Final Rule include the elimination of the rail transportation exemption for newly installed gas pipe transported before November 12, 1970; requiring leak surveys on Type B gathering lines; requirements for re-qualifying plastic pipe joiners in gas pipelines; and allowing e-mail submissions of safety-related condition reports, as well as integrity management and operator qualification notifications by electronic or regular mail. Notably, PHMSA withdrew or repealed several proposals in the Final Rule after review of comments, noting that the issues warrant further consideration. They include: specifying a method for calculating the length of a lateral transmission line to determine the applicability of Part 192 odorization requirements; threading of copper gas pipelines; and limitation of indirect costs in state grants.
The rule becomes effective October 1, 2015, but if an operator wishes to take advantage of certain clarifications in the regulations “immediate compliance with these amendments is authorized.”