Major Pipeline Safety Reform Bill Is On The Way

November 2010 Vol. 237 No. 11

Congress may vote during the lame duck session after the November elections on the biggest pipeline safety bill since the 2002 amendments established integrity management programs for distribution, transmission and hazardous liquid pipelines. Then again, a major reform bill may be delayed until the next Congress.

The San Bruno accident in California in September where a PG&E transmission pipeline exploded and killed seven spurred several major new bills from House and Senate Democrats, and the Obama administration. That accident followed other pipeline accidents this summer involving an Enbridge oil spill in Michigan and gas distribution line explosions in Texas.

A new pipeline safety reform bill is likely to require integrity management programs to expand beyond high consequence areas (HCAs) and elevate pigging as the inline inspection method of chose for initial baseline assessments. Currently, the transmission IMP lists pigging as one of four options. The cap on civil penalties and the number of inspectors working for the Pipeline and Hazardous Materials Safety Administration (PHMSA) will likely increase, too.

Evidence of the new Capitol feeding frenzy over pipeline safety was evident by mid-September when Transportation Secretary Ray LaHood announced the “Strengthening Pipeline Safety and Enforcement Act of 2010.” Until that point, the administration had shown no interest in reauthorization of the last pipeline safety amendments, the PIPES Act (The Pipeline Inspection, Protection, Enforcement and Safety Act of 2006), which expires at the end of this year. A failure to reauthorize that law, either by extending it or passing a new set of safety amendments, would not affect PHMSA’s ability to inspect pipelines or hand out fines. A reauthorization offers Congress the opportunity to improve any law to account for new concerns and circumstances.

Within a week or so of LaHood’s move, two separate pairings of Senate Democrats introduced two enhancements of the DOT reauthorization draft. House and Senate committees held hearings on pipeline safety at the end of September and received preliminary views from industry and public interest groups on the administration proposal and the bills from Sens. Barbara Boxer (D-CA) and Dianne Feinstein (D-CA) and Sens. Frank Lautenberg (D-NJ) and Jay Rockefeller (D-WV). The latter is chairman of the Senate Commerce Committee which has jurisdiction over pipeline safety and PHMSA.

The National Transportation Safety Board (NTSB) has yet to determine the cause of the San Bruno accident. The PG&E pipeline segment in San Bruno is located in an HCA. PG&E inspected the segment for internal corrosion using direct assessment, one of four methods approved under the transmission integrity management program, in November 2009. PG&E also did leak detection checks in March 2009 and March 2010 when no leaks were found.

The investigation by the NTSB may determine whether PG&E fulfilled all requirements under the transmission IMP. Ted Lopatkiewicz, an NTSB spokesman, expected a preliminary report to be issued as early as the week of Oct. 12. It will be a compilation of factual information gathered up to that point. “I don’t know what particular areas will be covered but it will not provide any determination of cause of the accident,” he says.

The results of that preliminary investigation will probably help guide congressional action on pipeline safety law improvements.

During the hearings at the House Energy & Commerce Committee in late September, Rep. Henry Waxman (D-CA), committee chairman, said, “I don’t think anyone can look at what has happened in Michigan or California and conclude that our pipeline safety laws are working as intended.”

House and Senate committees held hearings on pipeline safety earlier this year. But no one in Congress had introduced a reauthorization bill; nor had the Obama administration. That quickly changed after San Bruno.

The bill sent up to Congress by LaHood makes several changes to current law. When she came before Waxman’s committee Sept. 23 to discuss those changes, Cynthia Quarterman, administrator of the PHMSA, said her agency would also be proposing regulation changes-which require no congressional approval–in response to the San Bruno, Enbridge and the Texas accidents. She did not specify those, but they could be significant.

In terms of the draft legislative proposal submitted by LaHood, it would provide for an additional 40 federal pipeline inspectors, buttressing a current team of 100. The ceiling on civil penalties for pipeline safety violations would increase 250%. Gathering lines would be subject to federal safety laws for the first time. PHMSA would be charged with reviewing the integrity management programs for intrastate and interstate gas systems, and hazardous liquid lines, with an eye toward expanding them beyond HCAs.

Quarterman seemed to indicate PHMSA had already come to a conclusion before conducting the review. “The administration believes the time has come for pipeline operators to apply the latest inline inspection technologies over the widest possible areas of their systems to ensure safety and environmental protection,” she told the Waxman committee.

Don Santa, the INGAA president, answered Quarterman by pointing out that transmission companies are already inspecting many more miles than just those in HCAs. This is because pipeline operators are completing these inspections predominately using smart pigs. Pigs must be ‘launched’ and ‘received’ at aboveground facilities such as compression stations, which typically are located 75-100 miles apart. While a pipeline segment between a compression stations may contain only a few miles of scattered HCAs, the entire 75-100 mile segment must be inspected in order to capture those few HCA miles. In 2009, for example, about 23,000 miles of pipeline actually were inspected and repaired, even though only 2,343 miles were located in HCAs. INGAA estimates that approximately 65% of total transmission mileage will have been inspected and repaired by the end of the baseline testing period in December 2012.

Of course, inspection doesn’t always prevent an accident, as San Bruno underlines. San Bruno’s dependence on direct assessment may be called into question although pigging was impossible because of bends in that pipeline. That aside, Quarterman’s allusion to the need for pipelines to use “the latest inline” inspection techniques seemed to presage a push to eliminate direct assessment alone as an inspection technique.

The Feinstein-Boxer Strengthening Pipeline Safety and Enforcement Act of 2010 mandates inspections by “smart pigs” or by other inspection methods certified by the Secretary of Transportation as equally effective at finding corrosion. It prohibits natural gas pipelines from operating at high pressure if they cannot be inspected using the most effective inspection technology.

Christina Sames, vice president of operations and engineering, American Gas Association, says the Feinstein/Boxer bill seems to have a preference for pigging. However, it says almost nothing about an issue INGAA’s Santa thinks needs to be addressed: upgrading state excavation damage programs, especially provisions requiring diggers to call 800 numbers before initiating excavation. Excavation damage to pipelines is the biggest cause of pipeline accidents.

The Lautenberg-Rockefeller Pipeline Transportation Safety Improvement Act of 2010 includes provisions strengthening the PHMSA grant program which gives money to states to upgrade “call before you dig” programs. Some states exclude some diggers from their program such as railroads. Santa thinks those exemptions should be eliminated. The Lautenberg bill does not go that far, nor could it, since PHMSA only has responsibility for gas pipelines, not railroads and some other “diggers” who undertake excavation, such as municipal public works departments.

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