During the last week of the Obama Administration, PHMSA released a pre-publication copy of the hazardous liquid pipeline safety final rule, which has been six years in the making.  The rulemaking was intended to address issues raised by several sources: high profile pipeline accidents; directives contained in amendments to the Pipeline Safety Act; and recommendations from the NTSB and GAO.  The final rule would implement many significant and expansive inspection and reporting requirements, including periodic integrity assessments and leak detection for pipelines outside of high consequence areas (HCAs), inspections of pipelines after extreme weather events, expanded reporting, and more stringent integrity management repair and data collection requirements.

Despite clear Congressional mandates for many of these changes, this rule appears to have been delayed as a result of the regulatory freeze Executive Memorandum issued by the Trump administration in its first day in office.  That directive allows agencies to request an exception from the Office of Management and Budget for certain health and safety regulations, but it is not clear at this time whether PHMSA will seek such an exception for the rule.  The Executive Memorandum also acknowledged that new regulations directed by Congress would be exempt, but there was no explanation of how agencies were to interpret the Order when proposed rules had multiple sources.  Further, it is unclear how the administration’s more recent one in, two out executive order on rulemakings which requires that for every new rule proposed, the Agency withdraws two existing rules, will impact the finalization of these rules.

If finalized as issued in the pre-publication copy, the rule would become effective in 6 months after publication (with certain provisions with longer compliance periods).   The most significant rule changes are summarized below.

  • Assessments Outside HCAs:  Operator must perform periodic in-line inspection (ILI) assessments of onshore piggable transmission pipelines located in non-HCAs every 10 years.  Where use of ILI is operationally impracticable, operators must use a pressure test, external corrosion direct assessment or other technology approved by PHMSA.  While the Agency ultimately decided not to adopt repair criteria for these pipelines, it did include a general requirement that operators consider the risks to people, property and the environment in prioritizing corrective actions and repairs.
  • Leak Detection:  Operators of non-HCA pipelines transporting liquid in a single phase (except rural gathering pipelines) must implement “effective” leak detection systems within five (5) years and pipelines in HCAs and non-HCAS that become operational after the rule will have one (1) year to implement leak detection systems.  Computational monitoring leak detection systems must comply with industry standard API RP 1130.
  • Extreme Weather Event Inspections:  Operators must inspect pipelines potentially affected by extreme weather events (or other similar event) within 72 hours after the cessation of the event that has the likelihood to damage infrastructure.  PHMSA defined cessation of the event as “the point in time when the affected area can be safely accessed by available personnel and equipment required to perform the inspection.”
  • New Reporting Requirements for Onshore Gathering and Gravity Pipelines:  Operators of all hazardous liquid gathering lines (including unregulated gathering lines) and certain pipelines that carry product by means of gravity must comply with annual, safety-related condition, and incident reporting requirements.
  • Integrity Management Changes (Pipelines located in HCAs):
    • IM Assessment Methods: use of ILI is required for assessments unless it is impracticable.
    • IM Repair Criteria:  The rule adopts more stringent repair criteria for HCAs.  It adds additional immediate repair conditions (including certain stress corrosion cracking anomalies and selective seam weld corrosion) and sets forth 270 day conditions (while eliminating existing 60 day and 180 day repair categories).
    • Data Collection Requirements:  The rule outlines roughly twenty-one (21) data attributes that operators must integrate under its IMP programs, providing operators with one (1) year to begin integrating this information and three (3) years to integrate all attributes.
    • Modify Pipeline that Cannot ILI in 20 years:   Operators of pipelines in HCAs and areas that could affect HCAs must be capable of accommodating ILI tools within 20 years.  There are two exceptions, subject to PHMSA approval, where (1) the basic construction of a pipeline will not accommodate the passage of such a device or (2) the operator determines it would abandon the pipeline as a result of the cost of complying with the requirement.

We will continue to monitor developments regarding PHMSA response to the regulatory freeze and “2 for 1” Executive Orders, and post updates here.  We recommend that operators also consult their industry trade groups for updates regarding the status of the liquids pipeline rule.  For your convenience, we prepared a redline that outlines the Agency’s changes to Part 195 as reflected in the pre-publication version, which is subject to change in light of the regulatory review and analysis required by Trump’s executive directives.