The Chemical Safety and Hazard Investigation Board’s (“CSB’s”) long-awaited accidental reporting rule became effective on March 23, 2020. Under the new rule, 40 C.F.R. §§ 1604.1-1604.6., owners and operators of chemical facilities must report accidental releases that result in fatalities, substantial injury, or substantial property damage over a million dollars. This requirement includes reporting of releases that result in in-patient hospitalization, even if the hospitalization is taken as a precautionary measure. As such, this rule may impose a new reporting requirement for accidental releases from certain pipeline facilities that result in injury or property damage, such as at complex facilities where there is non-transportation related storage, processing or other handling of chemical substances.
In a surprisingly broad decision, the District of Montana vacated the U.S. Army Corps of Engineers (“Corps”) Nationwide Permit (“NWP”) 12 on April 15, 2020. NWP 12 authorizes impacts from “utility line activities” to jurisdictional waters that have minimal individual and cumulative adverse environmental effects. “Utility line” is broadly defined to include pipelines and any cable, line, or wire for the purpose of transmitting electricity or communication. The court found that the Corps failed to comply with the Endangered Species Act (“ESA), and thus remanded NWP 12 to the Corps for consultation with the U.S. Fish and Wildlife Service and the National Marine Fisheries Service (the “Services”) in accordance with Section 7 of the ESA. The court’s order prohibits the Corps from authorizing “any dredge or fill activities under NWP 12 pending completion of the [ESA Section 7] consultation process.”
PHMSA is proposing regulatory reform changes to the federal pipeline safety regulations at 49 CFR 190, 194, and 195, predominantly impacting liquid pipelines. Consistent with the Administration’s directives, the proposed revisions are intended to reduce regulatory burdens and improve regulatory clarity, without compromising safety and environmental protection. The proposed revisions were published in the Federal Register on April 16, 2020 and comments are due by June 15, 2020. These proposed changes would clarify and revise the requirements for how operators submit records to PHMSA; make important clarifications to the scope of pipelines that would require oil spill response plans; and, specific to liquid pipelines, substantially increase the property damage incident reporting threshold, allow remote monitoring of rectifier stations, and clarify integrity management guidance.
On April 9, the United States Court of Appeals for the Sixth Circuit heard arguments in National Wildlife Federation v. Secretary of the Department of Transportation, a pair of consolidated appeals arising from approval of two spill response plans by the Pipeline and Hazardous Materials Safety Administration (PHMSA). Operators of many onshore oil pipelines must submit, and PHMSA must review, plans to prevent or respond to a “worst case discharge” into or on navigable waters or their adjoining shorelines (49 C.F.R. Part 194). This planning process is a product of the Oil Pollution Act’s amendments to the Clean Water Act. In ruling on these appeals, the Sixth Circuit will determine whether PHMSA approval of those plans requires something that the agency historically has not done: consultation under the Endangered Species Act (ESA) or review under the National Environmental Policy Act (NEPA).
Today, U.S. Environmental Protection Agency (EPA) Assistant Administrator of EPA’s Office of Enforcement and Compliance Assurance (OECA) Susan Bodine issued guidance regarding OECA enforcement discretion in the wake of the coronavirus (COVID-19) COVID-19 pandemic. EPA intends to focus its resources largely on situations that may create an acute risk or imminent threat to public health or the environment. The guidance, which is retroactively effective to March 13, does not have an end date but EPA commits to reviewing the policy regularly and to providing a seven day notice of its termination on OECA’s guidance page.
The Troutman Sanders Corporate team has published the following article on COVID-19:
In a press release dated March 25, 2020, the United States Securities and Exchange Commission (the “Commission”) Chairman Jay Clayton encouraged “public companies to provide current and forward-looking information to their investors . . .” while continuing to prioritize health and safety during the ongoing global pandemic. In conjunction with this statement, the Commission’s Division of Corporation Finance (the “Division”) released CF Disclosure Guidance: Topic No. 9 (the “Guidance”), which provides the Commission’s current views regarding disclosure and other securities law obligations that companies should consider with respect to COVID-19 and related business and market disruptions.
The onset of the public health crisis caused by the spread of the coronavirus (COVID-19) has led to a global shortage of hand sanitizer. Businesses attempting to cope with new challenges presented by COVID-19 may be interested in retooling current manufacturing or other processes to begin developing hand sanitizer for external distribution or even internal use. In support of these efforts, the federal Food and Drug Administration (FDA) has issued guidance for both companies that are not currently authorized by the FDA to manufacture hand sanitizer companies and pharmacists in state-licensed, federal, or registered outsourcing facilities compounders that may be interested in producing hand sanitizer. Companies that adhere to this guidance and maintain sufficient documentation should be able to manufacture hand sanitizer for external distribution or internal use without enforcement exposure from the FDA.
Over the past week and in just the last 24 hours, several federal and state agencies have issued guidance documents and orders impacting the oil and gas pipeline industry. Through this guidance and other orders, federal and state governments are recognizing the oil and gas industry as critical to responding to COVID-19, while at the same time providing for some flexibility in the likelihood that operators will face resource and staffing constraints in executing their pipeline safety compliance obligations.
The coronavirus is causing marked disruption in the U.S., with increasing impacts across the country. Pipeline, terminal and LNG facilities are no exception, and many operators have been reviewing or implementing their contingency and emergency response plans. The current situation falls outside of most existing plans, however. With staffing concerns, travel limitations and other unforeseen issues, we expect operators will be presented with some challenges in the coming weeks in meeting all pipeline and LNG safety legal requirements. For example, we expect there may be issues with maintaining sufficient adequately trained and qualified staff for control rooms or field positions responsible for inspection and maintenance.
The Pipeline and Hazardous Materials Safety Administration (PHMSA) and the Transportation Security Administration (TSA) recently finalized an Annex to a longstanding Memorandum of Understanding (MOU) regarding pipeline safety and security. This Annex comes just weeks after a publicized natural gas pipeline cybersecurity intrusion and responds to several recommendations from the Government Accountability Office (GAO) discussed in our earlier alert to update the prior Annex which had not been reviewed or revised since its inception over 14 years ago. The updated Annex emphasizes information-sharing and coordination between the agencies and signals that the agencies are moving forward on satisfying outstanding GAO recommendations. While this is a step in the right direction, questions remain whether TSA is the appropriate agency to oversee pipeline security and whether existing voluntary standards should be mandatory.