The Pipeline and Hazardous Materials Safety Administration (PHMSA) on May 28, 2020, issued a pre-publication Notice of Proposed Rulemaking titled Gas Pipeline Regulatory Reform.  The proposal is issued pursuant to the Administration’s executive orders directing federal agencies to reduce burdens and in response to comments from the industry.  In keeping with that intent, the proposed changes appear generally favorable to the gas pipeline industry and should ease certain regulatory burdens related to discrete areas of gas pipeline incident reporting, construction (welding requalification), operation (primarily distribution and plastic pipelines), and maintenance (rectifier inspections and low-pressure pipelines).

Below is a summary of the major topics addressed in the NPRM.  Comments will be due sixty (60) days from publication in the federal register.

Incident Reporting Threshold

Perhaps the most meaningful proposal in the NPRM applicable to all gas pipelines is the expansion of the property damage threshold associated with a reportable “incident” in § 191.3.  To account for inflation, PHMSA proposes to raise the existing $50,000 threshold to $122,000.  The current property damage threshold has not changed since the adoption of the provision in the 1980s.  If adopted as final, pipeline operators would no longer have to report smaller incidents that cause property damage below the threshold.

Remote Monitoring of Rectifier Stations

Applicable to all regulated gas pipelines, PHMSA proposes to clarify that under § 192.465(b), operators may inspect rectifier stations – devices that run electric current along the pipeline to prevent corrosion – directly onsite or through remote monitoring technologies.  Operators who monitor rectifiers remotely would have to physically inspect them whenever they conduct a cathodic protect test under § 192.465(a).  A similar revision for hazardous liquid pipelines is being considered in a separate rulemaking.

Relief for Distribution Pipelines

Several of the proposed changes focus on distribution lines.  First, the proposal would allow operators of farm taps[1] to choose between conducting pressure regulator inspections under either their distribution integrity management plan (DIMP) or under the existing § 192.740 rule which requires inspections and testing at least once every 3 calendar years.  A 2017 rulemaking exempted farm taps from DIMP programs and revised § 192.740 to require regular inspections.  In practice, certain operators preferred to manage farm tap under their DIMP programs.  The current proposal would provide that as an option in lieu of § 192.740.

Second, PHMSA proposes to relieve distribution line operators from the requirement to submit mechanical fittings failure (MFF) reports through DOT Form PHMSA F-7100.1-2.  Instead, PHMSA will add MFF reporting to gas distribution annual reports.[2]

Third, PHMSA proposes to establish a separate atmospheric corrosion reassessment interval for gas distribution service lines.  Specifically, PHMSA proposes to expand the interval under which operators must conduct inspections from once every 3 years to once every 5 calendar years.  If an operator identifies atmospheric corrosion during an inspection, however, the requirement reverts back to once every 3 years, until no corrosion is identified.

Other Proposals

Additional proposed changes relate to the following:

  • Pressure vessels: lowering test factors for pressure vessels consistent with ASME Boiler Pressure Vessel Code.
  • Welder requalification: lowering welder requalification requirements that would likely prove beneficial for welders who weld relatively infrequently.
  • Pre-test applicability for low-stress pipelines: allowing certain low-stress pipelines to rely on pre-construction tests under § 192.505(d) instead of conducting a post-installation test, which may prove especially helpful for maintenance and repair activities.
  • Plastic pipe: incorporating ASTM standards related to Polyethylene (PE), including 2018 edition of ASTM D2513, “Standard Specification for Polyethylene (PE) Gas Pressure Pipe, Tubing, and Fittings;” 2019 edition of ASTM F2620, “Standard Practice for Heat Fusion Joining of Polyethylene Pipe and Fittings;” and 2019 edition of ASTM F2620, “Standard Practice for Heat Fusion Joining of Polyethylene Pipe and Fittings.”  PHMSA also proposes to raise the diameter limit for using design factor of 0.4 PE pipe from 12 inches to 24 inches and make other clarifications to the plastic pipe rules under Part 192.

The proposal appears to be generally favorable to the industry and provides flexibility to gas pipeline operators in certain discrete areas.  With respect to oil pipeline regulations, PHMSA already issued a regulatory reform proposal and comments are due on June 15, 2020.  That proposal addresses oil pipeline regulations as well as Part 190 regulations applicable to oil and gas pipelines and LNG pipeline facilities.

[1] A “farm tap” is the common name for an individual gas service line directly connected to a gas transmission, production, or gathering pipeline.

[2] PHMSA clarifies that the requirement to report MFFs that qualify as incidents per 49 C.F.R. Part 191 remains in place.