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 Congressional Review Act (CRA) has been in the news of late, yet few people know its history, purpose or challenges. Although used only once in its first 20 years, the Act was resurrected at the outset of the Trump Administration. In the first four months of 2017, the new Administration used the CRA to withdraw 14 rules promulgated late in the Obama Administration. There is an effort now to try to use the CRA to nullify even older rules, promulgated over the past 20 years, which could threaten to create more uncertainty for the regulated community.
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.
Building off of President Trump’s “Made in America” campaign commitment, the Trump Administration issued a tariff on steel imports on March 8, 2018. The proclamation finds that the imposition of duties on steel articles is necessary to ensure that steel imports will not threaten national security and, effective March 23, 2018, steel imports will be subject to a twenty-five (25) percent ad valorem tariff, except for imports from Canada and Mexico. The proclamation also authorizes the Commerce Department to grant exclusions from the tariffs of affected parties (1) if the steel at issue is determined not to be produced in the U.S. in a sufficient and reasonably available amount or of a satisfactory quality; or (2) based upon specific national security considerations. The President directed the Commerce Department to promulgate regulations as necessary to set forth the procedures for an exclusion process.
Prior to the effective date of the tariff, the Department of Commerce issued an interim final rule (IFR) to outline exclusions and the exclusion application process (set forth as a supplement to 15 C.F.R. Part 705). The IFR was issued without notice and comment and became immediately effective when published on March 19, 2018. While the IFR tracks the limited exclusions in the proclamation, much remains unclear with regard to the process and the likelihood of success for industry applicants. An exclusion will only be granted on a case by case basis where an article is not produced in the U.S. in a “sufficient and reasonably available amount,” is not produced in the U.S. in a “satisfactory quality,” or for a “specific national security consideration.” The IFR does not clarify the meaning of these terms or provide the industry with illustrative examples. The form for filing an exclusion request requires information such as the average annual consumption of the product at issue for the past two years, time involved in delivery, manufacture, and shipment of the product from a foreign suppliers, specifics about the physical properties of the product, and detailed U.S. product availability information (including attempts to qualify a US steel manufacturer or procure the steel from a US manufacturer).
The rule also establishes limits on who can request an exclusion and the scope of any exclusion. Exclusions are limited to individuals or organizations using steel articles in business activities (e.g., construction, manufacturing, or supplying steel to users). Approvals of exclusions will be specific to the individual or entity who submitted the request, unless Commerce approves a broader application of the exclusion to apply to other importers. Objections may be filed by any individual or organization, but Commerce will only consider information directly related to the submitted exclusion request.
The IFR states that “follow-on” requesters to exclusions that are approved will be taken into consideration, but signals that approval will depend on the strength of a requester’s application which may potentially set the stage for inconsistent results. Exclusion requests, objections and comments on the IFR will be public and located in the federal register docket. The rule establishes a 30 day period for individuals or organizations to file objections (from posting of the exclusion request) and a 90 day period for the Department to review and adjudicate any objections to an exclusion request. Responses approving exclusion requests will be effective within 5 days and will generally be approved for one year. Commerce estimates that it will receive tariff exclusion requests from 4,500 applicants. To date, no requests have been posted to the federal docket associated with steel import exclusions.
The Administration’s January 2017 Executive Memorandum requiring that all new and repaired pipe be made in the U.S. and the issue of steel tariffs have been the subject of much comment by the pipeline industry. Industry operators and trade groups have argued that such requirements will result in construction delays, project cancellations, higher costs and consumer impacts if they are implemented. There are major constraints on the procurement of adequate quantities of line pipe materials and equipment in the U.S., due to the unavailability of U.S. made pipe at necessary technical specifications and in time to meet market demands and/or regulatory requirements. It remains uncertain whether the Commerce Department’s IFR will resolve any of these concerns, if it will be subject to judicial challenge or whether the exclusion process will prove to be workable for industry.
In an attempt to bring clarity following the recent Supreme Court decision—which as noted in our prior post will result in expiration of the nationwide stay of the 2015 revised definition of “waters of the U.S.” that was imposed two years ago by the Sixth Circuit Court of Appeals—EPA and the Army Corps of Engineers (Corps) issued a final rule extending the applicability date of the 2015 revised definition to February 6, 2020. With this final rule, the Agencies seek to ensure that the pre-2015 “waters of the U.S.” definition will remain in place consistently throughout the country while the Agencies consider possible revisions. As expected, the final rule has already been subject to judicial challenge, further ensuring that the scope of “waters of the U.S.” will continue to remain uncertain in the near future as these challenges play out. Continue Reading Final Rule Adds 2020 Applicability Date to “Waters of the U.S.” Rule
Last week, PHMSA’s oil and gas pipeline technical advisory committees convened to review and discuss significant pending rulemakings and regulatory reform initiatives, among other topics. At the same time, the White House touted its deregulation efforts, including the purported elimination of 22 regulations in the past year for each new rule passed. For an agency that is facing outstanding statutory mandates to enact certain regulations, with reauthorization looming in 2018, it is expected that PHMSA will promulgate some new rules in the New Year. It is not yet known, however, what the content of those rules will be and whether the expansive gas ‘mega rule’ will be among those finalized in 2018. Given the overall regulatory climate to reduce regulation and burden, a little certainty might be appreciated in the New Year. Continue Reading All I want for Christmas is … regulatory certainty?
The Department of Transportation formally requested public comment on existing rules and “other agency actions,” including but not limited to guidance documents and policy statements, that are good candidates for repeal, replacement, suspension, or modification without compromising safety. This request covers all DOT modal agencies, including PHMSA, the FAA, the FRA, NHTSA, among others. In addition to requesting comments, DOT indicated that it may hold a public meeting on these issues. Comments are due November 1, 2017.