A recent PHMSA Advisory Bulletin warns the pipeline industry about Corrosion Under Insulation (CUI), which is frequently used on pipe transporting heavy crude oil. Such products are often heated for more efficient transport, thus the pipe is wrapped with foam insulation over the coating, and then further covered with a tape wrap over the insulation. The crude oil release from a Plains All American pipeline near Santa Barbara in May of 2015 used such thermal insulation, and the government’s investigation following that release prompted this Advisory from PHMSA.
PHMSA’s expansive Natural Gas Notice of Proposed Rulemaking will be published in the Federal Register tomorrow, April 8, 2016. The Agency released a pre-publication version of its proposed rulemaking several weeks ago, but note that the Federal Register pre-publication version of what will be officially published tomorrow contains slight non-substantive differences from the Agency’s prior released version (e.g., capitalizations, movement of certain proposed revisions among subsections, etc.). The proposal significantly expands numerous requirements for gas transmission and gathering pipelines. Publication in the Federal Register triggers the start of the comment period, with comments due on or before June 7, 2016, unless an extension is granted. Due to the complexity and volume of the proposed changes, several industry trade groups already have requests pending for a 60 day extension of the comment deadline.
PHMSA has released a Notice of Proposed Rulemaking (NPRM or Notice) to substantially revise that Agency’s rules (at 49 CFR Part 192) for construction, operation and maintenance of natural gas pipeline systems. The Notice was made available to the public on March 17, 2016 (accompanied by a press release dated March 15, 2016). Public comments on the NPRM will be accepted for 60 days following publication of the Notice in Federal Register (the Notice has not been published yet).
Congress directed PHMSA to consider numerous new rules for natural gas pipelines in the 2011 reauthorization of the Pipeline Safety Act. That directive was made largely in response to several serious gas pipeline incidents in 2010 and 2011, including the San Bruno, California fatality incident. In addition, in 2011 the NTSB issued various recommendations to PHMSA as a result of its investigation of the San Bruno incident, including elimination of the “grandfather” clause and the requirement of a pressure test and spike test for all pre-1970 transmission lines, amending the integrity management rules so that pipelines with manufacturing and construction defects be subjected to a post-construction pressure test of 1.25 MAOP, and require that all transmission lines be configured to accommodate ILI, among others. The Agency has been criticized for taking nearly five years to fulfill its Congressional obligation and to respond to the NTSB recommendations, but both industry and citizen groups welcome the opportunity to finally be able to evaluate and comment on changes being proposed (as opposed to grappling with vague and uncertain advisory guidance).
Some issues anticipated to be addressed in the gas NPRM have been excluded (e.g., proposed elimination of class locations) or postponed for subsequent rulemakings (e.g., whether to mandate automatic shutoff valves (ASVs) and whether to regulate underground natural gas storage). Other proposals within the Notice are almost anti-climactic, such as phase out of the “grandfather clause” authorizing continued use without internal testing of pipelines constructed prior to 1970 largely because the majority of industry has already been making operational changes in anticipation of this change. In addition, the Notice includes proposals for inspection of pipelines within 72 hours following a weather event (a similar proposal was floated for liquid pipelines) and codifying of the Agency’s prior advisory regarding reporting of MAOP exceedances.
Some of the more significant proposals within the Notice include changes to the integrity management program, such as proposed revisions to: repair criteria for HCA pipeline segments to address crack defects; risk assessment and models; new proposed integrity assessment methods, selection and use of direct assessment methods; additional requirements to address corrosion threats; hydrostatic “spike” test requirements for crack or crack-like defects; and treatment of longitudinal seam weld pipe (would be considered stable threat only if pressure tested to 1.25 MAOP). The NPRM also proposes numerous non-integrity management requirements, including: expanding application of several IM program elements (assessment, periodic reassessment and repair criteria) to “moderate consequence areas” (pipelines near 5 or more buildings or right of way for interstate freeway, etc.) and class 3 and 4 locations; expanding the scope of regulated gathering lines; significantly increasing corrosion control requirements; and requiring material documentation and MAOP verification and testing requirements to class 3 and 4 locations and HCAs. In addition, the proposed rule would also codify the “traceable, verifiable and complete” standard that PHMSA issued in its post-San Bruno records advisory and require that all pipelines maintain a management of change process.
In short, this is an aggressive proposal which industry should carefully consider, and prepare and submit thoughtful comment. Hunton & Williams will continue to monitor and will post updates as appropriate.
PHMSA has issued a pre-publication copy of its much-anticipated Notice of Proposed Rulemaking (NPRM) concerning hazardous liquid pipeline safety issues. These proposed rules were prepared in response to certain Congressional mandates under the 2011 amendments to the Pipeline Safety Act as well as critiques from GAO and NTSB. This appears to be one of PHMSA’s most ambitious rulemakings to date, and is likely to generate significant comment from industry. The Agency issued the proposal after two recent Senate hearings on pipeline safety, and as Congress prepares to consider reauthorization of the Pipeline Safety Act. Comments are due by January 8, 2016.
PHMSA has re-issued an Advisory, reminding gas and hazardous liquid pipeline operators of the potential for damage to their pipeline facilities caused by the passage of hurricanes. The Advisory, which was originally published in 2011, explains that hurricanes can adversely affect pipeline operations and can increase the risk of pipelines becoming exposed or constituting a hazard to navigation in the case of underwater pipelines in the Gulf of Mexico. According to PHMSA, such circumstances trigger an operator’s obligation to take appropriate corrective measures. 80 Fed. Reg. 36042, 36043 (June 23, 2015) (citing 49 C.F.R. Parts 192.613 (surveillance of gas pipelines); 195.401(b) (repairs on hazardous liquid pipelines); 192.613, 195.413 (underwater inspections of shallow-water gas and hazardous liquid pipelines)).
The American Petroleum Institute (API) announced today the release of a new pipeline safety management system standard, ANSI/API Recommended Practice 1173. The standard has been under development since NTSB recommended that a safety management system (SMS) standard be developed for the pipeline industry in 2012, in its report following the 2010 oil pipeline accident in Marshall, Michigan. RP 1173 was developed by API with input from NTSB, PHMSA, states, and industry representatives. After the draft standard was issued for public comment in early 2014, PHMSA held a series of public workshops (see prior posts on the February and July 2014, and April 2015 workshops), bringing together representatives from pipeline industry sectors, state and federal regulators, and public safety advocates to discuss SMS best practices.
PHMSA has published a Notice of Proposed Rulemaking (NPRM), proposing various changes to the natural gas pipeline safety regulations (49 C.F.R. Part 192) to address regulatory requirements involving plastic piping systems used in gas services. Comments on the proposal are due July 31, 2015.
Regulators and researchers alike have long been trying to accurately estimate leakage rates from natural gas infrastructure, in order to understand the potential effects of such emissions on climate and human health. EPA’s Office of Inspector General reported last year that methane leaks from distribution pipelines accounted for more than 10% of total methane emissions from natural gas systems, and it recommended, among other things, that EPA work with PHMSA to address methane leaks from a combined environmental and safety standpoint. Earlier this year, the Obama administration announced as part of its Climate Action Plan new goals to cut methane emissions from the oil and gas sector 40 to 45% from 2012 levels by 2025, and stated that new PHMSA standards for natural gas pipelines expected in 2015, while focused on safety, “are expected to lower methane emissions as well.”
A new study (led by Brian Lamb at the Laboratory for Atmospheric Research at Washington State University) posits that EPA’s model for estimating the amount of methane leaked from the nation’s gas distribution systems is outdated. Direct Measurements Show Decreasing Methane Emissions from Natural Gas Local Distribution Systems in the United States, Lamb et al., at p. 5161. EPA does not directly measure methane emissions for its yearly estimates. These emissions figures are instead based on a 1992 study in which the Agency, in conjunction with the Gas Research Institute (GRI), compiled “emissions factors” for natural gas industry components, which are multiplied by an estimate of the number of such components across the U.S. to create a national estimate of methane emissions for the industry. Id. EPA annual emissions inventories are based upon the original emissions factors from the EPA/GRI study, which have not been revised in more than 20 years to reflect replacement and/or upgrades of metering and regulating facilities, reduction in miles of older cast iron and unprotected steel pipeline, increases in protected steel and plastic pipeline miles, and improvements in leak survey methods. Id. at 5162.
The study’s authors implemented a national sampling program, directly measuring methane emissions from underground pipeline leaks and metering and regulating facilities of 13 local distribution companies (representing 19% of distribution pipeline mileage) across the country. Id. Sampling results led to the development of emissions factors generally lower than those used in the 1992 EPA/GRI study (particularly for underground pipeline leaks and plastic mains), attributable to improvements in leak detection technology, replacement of older pipes, and better maintenance since the 1990s. Id. at 5163. The study concludes that between 0.10% and 0.22% of total gas delivered via the national’s distribution pipeline network is lost through leaks, an estimate 35% to 70% lower than EPA’s estimate in its 2011 emission inventory. Id. at 5167.
The study comes on the heels of recent efforts in several states (California, Massachusetts, and New York, for example) to require natural gas pipeline operators to monitor and/or address leaks on their systems, both for environmental and public safety reasons. Despite indications in the study that methane emissions from gas distribution systems have decreased in recent years, given the current interest in climate change and safety impacts associated with gas pipeline leaks, EPA and PHMSA regulatory efforts to address pipeline-related emissions are likely in the near future. System operators and the public should be aware of this new information when new rulemaking proposals are made available for comment.
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.
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 Advisory Regarding Damage to Pipelines from Flooding