PHMSA has finally published guidance to better delineate federal oversight of midstream processing facilities for public comment. The guidance, in the form of Frequently Asked Questions (FAQs), is intended to avoid gaps or overlaps in regulatory oversight of midstream facilities, particularly between PHMSA and OSHA. Comments are due by January 4, 2021. An example of the success of working groups where industry and agencies partner to provide additional regulatory clarity, the FAQs should — if finalized after notice and comment — provide more certainty to both regulated midstream processing operators and state and federal agencies.

Continue Reading PHMSA Publishes Midstream Processing Guidance

The Pipeline and Hazardous Materials Safety Administration (“PHMSA” or the “Agency”) published a Notice of Proposed Rulemaking (“NPRM” or the “Proposed Rule”) that provides increased flexibility to gas transmission pipelines that experience a certain change in population surrounding the pipeline (from a Class 1 to Class 3 location). These changes have been the subject of numerous Special Permit approvals for some time, and the industry has long requested that PHMSA codify this process to avoid unnecessary pipe replacements of short segments. If finalized, the Proposed Rule would provide operators an alternative option to implement integrity management (“IM”) requirements to ensure that a pipe segment is subject to appropriate class location safety factors and thereby avoid unnecessary and costly pipe replacements or pressure reductions. Comments are due by December 14, 2020.

Continue Reading Class Location Proposal to Provide Flexibility to Operators

The Pipeline and Hazardous Materials Safety Administration (PHMSA) has issued two Advisory Bulletins directed to natural gas distribution pipeline owners and operators. PHMSA released the advisories in response to the National Transportation Safety Board (NTSB) recommendations arising out of two high-profile distribution pipeline incidents in Silver Spring, Maryland and Merrimack Valley, Massachusetts. The first advisory focuses on indoor meters and regulators to remind operators of the relevant regulatory requirements and risks. The second advisory covers low-pressure distribution systems, emphasizing the possibility of failures due to overpressurization.

Continue Reading PHMSA Advisories Target Distribution Pipeline Meters and Overpressure Protection

The Government Accountability Office (GAO), an agency that conducts audits, evaluations, and investigations for the United States Congress, issued a report titled “Natural Gas Exports: Updated Guidance and Regulations Could Improve Facility Permitting Processes.” The report examines several aspects of federal agencies’ regulation of liquefied natural gas (LNG) facilities, but of most relevance to LNG operators is the finding that the technical standards that the primary regulators of LNG facilities incorporate into their rules are out of date.

Continue Reading GAO Calls on PHMSA to Update LNG Regulations

Two months ago, we issued a post regarding oral arguments before the U.S. Court of Appeals for the Sixth Circuit in National Wildlife Federation v. Secretary of the Department of Transportation. That case asked whether approval of pipeline spill response plans by the Pipeline and Hazardous Materials Safety Administration (PHMSA) triggered consultation and review processes under the Endangered Species Act (ESA) and the National Environmental Policy Act (NEPA). In an opinion released on Friday, June 5, 2020, the Sixth Circuit answered that question in the negative. The court’s decision avoids adding another substantial burden to the review process for response plans, and, since it reaches the same result as the only other appellate court to consider the question, the decision likely will not attract the attention of the Supreme Court.
Continue Reading Sixth Circuit: Spill Response Plans Do Not Trigger Endangered Species Act or NEPA Review

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).

Continue Reading PHMSA Issues Gas Pipeline Regulatory Reform Proposal

The United States Department of Transportation (“DOT”), Office of the Inspector General (“OIG”) recently issued its audit findings of the Pipeline and Hazardous Materials Safety Administration’s (“PHMSA’s”) procedures and standards for reviewing whether liquified natural gas (“LNG”) facilities meet federal safety standards. The audit was designed to assess PHMSA’s (1) review of proposed LNG facilities, (2) inspection of existing LNG facilities, and (3) evaluation of state gas programs that are tasked with inspecting LNG facilities. While the OIG found that PHMSA’s inspection of existing interstate LNG facilities met agency standards, the audit identified several deficiencies with PHMSA’s siting of proposed LNG facilities and its review processes of state programs. This report comes as PHMSA’s proposed overhaul of its Part 193 LNG safety regulations moves toward publication.

Continue Reading OIG Critical of PHMSA LNG Reviews

As we previously reported, the Federal District Court for Montana vacated the U.S. Army Corps of Engineers (“Corps”) Nationwide Permit (“NWP 12”) on April 15, 2020, finding that the Corps had failed to consult with the U.S. Fish and Wildlife Service and the National Marine Fisheries Service prior to issuing NWP 12. The court’s decision vacated NWP 12 nationwide and prevents the Corps from authorizing a broad range of projects that are unrelated to the project at issue in that case, the Keystone XL Pipeline.  Yesterday, the Corps requested that the court stay the effect of its ruling pending the Corps’ appeal to the Ninth Circuit. The Corps requested in the alternative that the court stay its ruling with respect to all projects across the country, except the Keystone XL Pipeline.

Continue Reading Update: Corps Seeks Stay of Montana District Court’s NWP 12 Ruling

A Montana federal district court recently dismissed a challenge by an environmental group seeking to compel the Pipeline and Hazardous Materials Safety Administration (“PHMSA”) to comply with certain provisions of the Mineral Leasing Act, 30 U.S.C. § 181 et seq.,. See Wildearth Guardians v. Chao, CV-18-110-GF-BMM, 2020 WL 1875472 (D. Mont. Apr. 15, 2020).  In this case, the environmental group Wildearth Guardians brought suit under the Administrative Procedure Act (“APA”) alleging that PHMSA failed to comply with its legal obligation under the Mineral Leasing Act to “[p]eriodically, but at least once a year,  . . . cause the examination of all pipelines and associated facilities on Federal lands[.]”  Although PHMSA did not contest Wildearth’s assertion that the agency had failed to periodically inspect certain pipelines on federal lands, PHMSA argued that the suit must be dismissed because Wildearth lacked standing to challenge PHMSA’s inaction and the environmental group was unable demonstrate that PHMSA’s failure to inspect the pipelines constituted a “failure to act” under the APA. The district court agreed and narrowly interpreted what constitutes a “failure to act” under  the APA in a manner that could present obstacles for third parties seeking to compel agencies to comply with its their regulatory obligations.

Continue Reading Environmental Group’s Attempt to Compel PHMSA Action Dismissed

The coronavirus (COVID-19) pandemic understandably has strained available personnel and other resources as oil and gas pipeline operators focus on maintaining their essential operations. For the gas industry, the pandemic comes at a time that coincides with the initial deadlines associated with the first installment of the Pipeline and Hazardous Materials Safety Administration’s gas “mega” rule, July 1, 2020. In order to provide gas operators with further flexibility due to constrained resources, PHMSA announced a 6-month stay of enforcement of initial Part 192 compliance deadlines in the rule, “if a regulated entity fails to meet such requirement by Dec. 31, 2020, for reasons attributable to the [COVID-19] National Emergency.”

Continue Reading Ongoing COVID-19 Pandemic Prompts Gas Pipeline Enforcement Stay