As part of its integrity management regulatory scheme, the Pipeline and Hazardous Materials Safety Administration (PHMSA) is requesting comments on a draft risk modeling report. In certain densely populated or environmentally sensitive areas, PHMSA integrity management rules require the continual evaluation of ways to reduce pipeline threats to minimize the likelihood and consequences of an incident. Because these rules are performance based, the methodology for analyzing and assessing risk is not prescribed and the industry employs a variety of approaches. PHMSA’s draft report similarly does not dictate a particular methodology but clearly favors probabilistic and quantitative risk models that may not be practical or effective for many operators. Operators should take the opportunity to review and comment on the draft report to ensure that their experiences and insights with risk modeling are reflected prior to finalizing the document. Based on a request from industry trade groups, PHMSA recently extended the comment period an additional 30 days until October 17, 2018.
The Pipeline and Hazardous Materials Safety Administration (PHMSA) has published an Advanced Notice of Proposed Rulemaking (ANPRM) requesting comments on existing requirements for gas transmission pipelines following population growth. This notice is the result of previous Agency requests for comment, Congressional mandates, Agency workshops, and industry comments dating back nearly a decade. The proposed rulemaking could provide industry with additional options when population increases trigger class location changes, and thereby avoid costly pipe replacement or pressure testing.
The Gas Pipeline Advisory Committee (GPAC) convened in Washington D.C. at the end of March, 2018, to continue discussions from May and December 2017 regarding PHMSA’s proposed gas and gathering pipeline mega rule (“Safety of Gas Transmission and Gathering Pipelines” [PHMSA-1011-0023]. The meetings included discussion and voting on a number of provisions concerning maximum allowable operating pressure (MAOP), integrity management, definitions and repair criteria. Most notably, PHMSA announced its intention to divide the original Notice of Proposed Rulemaking (NPRM) into three parts and issue three separate final rulemakings in 2019 [PHMAS PowerPoint]. PHMSA is currently projecting that these three rulemakings will be issued over the course of next year, with the first one focusing on outstanding congressional mandates, as follows::
Part I (expected issuance in March 2019) to address the expansion of risk assessment and MAOP requirements, including:
- 6-month grace period for 7-calendar year reassessment intervals;
- Consideration of seismicity for integrity management assessments (fort both threats and preventative and maintenance measures)
- MAOP exceedance reporting
- Material verification, MAOP reconfirmation (for those with unknown MAOPs or incomplete records)
- Expansion of the risk assessment obligation to include areas in non-high consequence areas (HCAs) and moderate consequence areas (MCAs)
- Related records provisions
Part II (expected issuance in June 2019) to focus on the expansion of integrity management program regulations, including:
- Adjustments to repair criteria for pipelines in HCAs and non-HCAs
- Inspections following extreme weather and other events
- Safety features on in-line inspection launchers and receivers
- Management of change
- Corrosion control
- Other integrity management clarifications and increased assessment requirements
Part III (expected issuance in August 2019) to focus on expanding the regulation of gas gathering lines, including:
- Reporting requirements
- Safety regulations for gas gathering lines in Class I locations
The next GPAC meeting is scheduled for June 12-14, 2018, and it is expected to focus on the NPRM provisions concerning gas gathering pipelines. As noted in our prior post , the advisory committee meetings are particularly informative to industry and other interested parties concerning the direction PHMSA will take with these final rules.
In October 2017, the National Academy of Sciences (NAS) issued a pre-publication report on “Designing Safety Standards for High Hazard Industries.” Sponsored by PHMSA (and many years in the making), the Report focuses on oil and gas pipelines and the regulatory scheme used by the Pipeline and Hazardous Materials Safety Administration (PHMSA). Noting the differences between prescriptive and performance based rulemakings, the Report observes that while most federal agencies use a combination of both, PHMSA is one of the few federal agencies that primarily relies on performance based standards. The rationale used by PHMSA, the Report notes, is that pipeline integrity management is best maintained by placing responsibility on individual operators to identify and manage risks that may not be known to the regulators or common to the industry. (Report, p. viii).
The 5th Circuit issued a lengthy opinion on August 14, 2017, reversing most of the violations of a PHMSA enforcement action that began in November 2013 in conjunction with investigation of a failure on the Pegasus Pipeline. In that matter, PHMSA alleged that the ExxonMobil Pipeline Company (EMPCo) failed to properly consider the risk of failure on a segment of pre-1970 low frequency electric resistance welded (LF-ERW) pipe. The Agency assessed a penalty of nearly $2.7 million for the various alleged violations. In a rare judicial decision regarding a PHMSA Final Order and Decision on Petition for Reconsideration, the Court reversed all but one of the items on appeal, and vacated the penalty associated with those alleged violations (dismissing over $1.6M of the total penalty). The Court remanded the one remaining item back to PHMSA for recalculation of the associated penalty.
The Government Accountability Office (GAO) issued a report on August 4, 2017, titled “Pipeline Safety – Additional Actions Could Improve Federal Use of Data on Pipeline Materials and Corrosion.” The 55 page Report, prepared in response to a Congressional mandate in the 2016 Pipeline Safety Act reauthorization, summarizes pipeline materials, training and corrosion prevention technologies for gas and liquid pipeline facilities and analyzes PHMSA use of corrosion and material data to inform its inspection priorities. The Report recommends that PHMSA review, document and validate the way in which it identifies the highest risk pipelines for inspection, but makes no significant new findings, and the recommendations are largely consistent with initiatives that PHMSA already has begun.
The Report notes initially that pipelines carrying hazardous liquids or gas have the lowest incident rate of other transportation modes. For oil and gas pipelines from 2010 to 2015, GAO’s assessment of PHMSA incident data attaches the highest single cause as corrosion (22%), followed by “equipment failure” (21%), “natural or outside force” (16%) and “excavation damage” (14%). PHMSA tracks causal data somewhat differently, however, grouping “equipment failure” and “material/weld failures” together in a single category, which is reported by operators to be the largest cause of significant incidents in the past 5 years. By comparison, the GAO Report links corrosion (22%) with “material, pipe or weld failure” (12%), although it is a very different failure mechanism from corrosion, to be the estimated cause of nearly one-third of all oil and gas significant incidents.
The Gas Pipeline Advisory Committee (GPAC) will meet [Notice of advisory committee meeting] in Washington, D.C. early next month to convene the second public meeting regarding PHMSA’s proposed gas rules, often referred to as the gas mega rule. The meetings will be focused on key proposed revisions to 49 C.F.R. Part 192 natural gas rules, including expanded integrity assessment requirements, revised integrity assessment and repair criteria, records, material documentation, corrosion control, and the integrity verification process (IVP) for segments that are currently grandfathered under the rules. The meetings are scheduled for Tuesday and Wednesday, June 6-7, 2017, from 8:30 a.m. to 5:00 p.m.
PHMSA issued a brief advisory reminding gas transmission operators of training and qualification requirements under the integrity management regulations. The advisory responds to inconsistencies in operator implementation of these rules (at 49 C.F.R. Part 192.915) and outlines PHMSA’s “expectations.” Further, the advisory addresses inadequacies highlighted by a 2015 National Transportation Safety Board’s (NTSB) Safety Study. In issuing the advisory, PHMSA appears to be taking an expansive interpretation of certain aspects of its integrity management rules regarding training and qualifications, which may not be supported by the regulations and thus may not be enforceable. Continue Reading Expansive Integrity Management Training and Qualification Advisory