April 2022 Issue
In This Issue
- PHMSA Responds to Gas Gathering Rulemaking Petition for Reconsideration
- PHMSA Issues 2022 Civil Penalty Adjustments
- America’s Natural Gas Industry Will be Essential to Achieve a Net-Zero Emissions Future
- EFRD Evaluation
- Additions and Changes to PHMSA Forms for Gathering Pipeline Systems Annual Reports
- The Enforcement Corner
- Client Feedback
PHMSA Responds to Gas Gathering Rulemaking Petition for Reconsideration
PHMSA responded to a Petition for Reconsideration and a Motion to Stay of Final Rule, “Safety of Gas Gathering Pipelines: Extension of Reporting Requirements, Regulation of Large, High-Pressure Lines, and Other Related Amendments.” The Petition and Motion were filed by the American Petroleum Institute and the GPA Midstream Association. The Petition asserted that PHMSA’s adoption of the Final Rule failed to comply with procedural requirements under the Pipeline Safety Act, as amended, (49 U.S.C. 60101 et seq.) and the Administrative Procedure Act (5 U.S.C. 551 et seq.,) by failing to adequately evaluate the costs and benefits of the Final Rule and by failing to respond to Petitioners’ comments regarding the costs and benefits of the Final Rule. The Petition also asserts that PHMSA failed to conduct an adequate assessment the impact of the Final Rule on small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). In addition, the Petition requested that PHMSA adopt revisions to certain provisions of the Final Rule. The Motion seeks a stay of certain provisions of the Final Rule, asserting that Petitioners’ members will suffer irreparable harm unless PHMSA grants a stay of certain elements of the Final Rule pertaining to Type C gathering lines.
PHMSA largely denied the Petition, but did acknowledge that the Petitioners raise concerns regarding certain language in the Final Rule that would benefit from clarification. PHMSA intends to issue a Federal Register notice that will address three issues described below.
- Codify in regulation that Type C gas gathering lines that are not otherwise required to establish a MAOP under 49 CFR 192.9(e)(2)(ii) and 192.619 do not have to submit safety related condition reports pursuant to § 191.23. This reporting exemption will apply to Type C gathering lines with outside diameters less than or equal to 12 inches and Type C lines 16 inches and smaller that do not impact a Building Intended for Human Occupancy or Other Impacted Site using the Potential Impact Radius (Method 1) or Class Location Unit (Method 2) methods.
- Petitioners request PHMSA revise the Final Rule to codify in regulation that operators may use the default yield strength of 24,000 psi as depicted under § 192.107(b)(2) when calculating the SMYS of a gathering line for the purpose of determining whether it is a Type C gathering line. PHMSA acknowledged that this is acceptable, but denied the request to amend code language stating that the rules already allow for use of the default yield strength value.
- PHMSA will not enforce the 10-mile threshold within the Final Rule’s revised definition of “incidental gathering” in connection with projects replacing, repairing, or changing those lines existing on May 16, 2022 that are currently designated as “incidental gathering” lines. PHMSA will memorialize that enforcement discretion in a forthcoming Federal Register notice, will communicate that notice to state pipeline safety agencies, and will consider whether further revisions to the regulatory definition of “incidental gathering” is appropriate.
For more information about the gathering rule or what RCP can do to help with meeting the implementation deadlines, contact Jessica Foley.
PHMSA Issues 2022 Civil Penalty Adjustments
PHMSA has published the 2022 Maximum Civil Penalty amounts, found under §190.223 Maximum Penalties, with a 1.06222% increase to maximum civil penalties.
This authority was granted to PHMSA under the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (herein referred to as the 2015 Act). Section 4(b)(2) of the 2015 Act specifically directs that the annual adjustment be accomplished “through final rule without notice and comment.”
This rule is effective immediately.
The 2015 Act directed the Office of Management and Budget to issue guidance on implementing the required annual adjustment. To derive the 2022 adjustment, the DOT was required to multiply the maximum penalty amount by the percent change between the October 2021 CPI-U (Consumer Price Index for All Urban Consumers) and the October 2020 CPI-U.
In this case, the change between the October 2021 CPI-U and the October 2020 CPI-U was 1.06222%.
For more information on recent PHMSA enforcement actions, check out the Enforcement Corner down below.
America’s Natural Gas Industry Will be Essential to Achieve a Net-Zero Emissions Future
Climate change is a defining challenge across the globe, and natural gas, natural gas utilities and the delivery infrastructure are essential to meeting our nation’s emissions reduction goals. Learn more about how the natural gas industry will play a critical role in helping reach our nation’s environmental goals in a recently release report from The American Gas Association, Net-Zero Emissions Opportunities for Gas Utilities. Learn more on AGA’s website.
RCP can assist pipeline operators (both gas and liquids) with performing an emergency flow restricting device (EFRD) evaluation based on the criteria, e.g. type of leak detection installed, product transported, quantity released, local topography, etc., identified in the Integrity Management rules. §192.179 requires that intermediate valves be installed along a cross country pipeline at the time of construction at specified intervals based on class location. Likewise, §195.260 identifies for liquids pipelines locations where valves must be installed at the time of construction but it is much less specific than for gas lines. For more information on an EFRD Study for your pipeline assets, contact Jessica Foley.
Additions and Changes to PHMSA Forms for Gathering Pipeline Systems Annual Reports
Type R (Reporting-Regulated) Gas Gathering Pipeline Systems Annual Report Form PHMSA F 7100.2-3 (new 3-2022):
Beginning approximately May 16th, 2022, PHMSA will now require annual reports for previously unregulated gas-gathering pipeline systems. The annual report will be documenting miles of reporting-regulated gas gathering lines by nominal pipe size (NPS), decade installed, material and corrosion prevention status, leaks eliminated or repaired by cause, and any known system leaks scheduled for repair, including those on federal land.
Changes to the Natural and Other Gas Transmission and Gathering Pipeline Systems Annual Report Form PHMSA F 7100.2-1 (rev 10-2021) are as follows:
Part B1 & T– HCA Miles by Determination Method and Risk Model Type
This is a new addition and will be deferred until 2023 when miles are reported for calendar year (CY) 2022. All miles are to be reported by HCA Determination Method 1 or 2, as well as the associated risk model, used for those pipeline systems.
Part D & P – Miles of Pipe by Material and Corrosion Prevention Status
Onshore Type C gathering miles is now an added option to the table where operators list miles by material, coating, and cathodic protection status.
Part I – Miles of Gathering Pipe by Nominal Pipe Size (NPS)
Onshore Type C miles have been added to the table for reporting gathering pipeline systems by nominal pipe size.
Part J – Miles of Pipe by Decade Installed
Onshore Type C gathering systems have been added to the table for reporting miles of pipe by the decade it was installed.
Part L – Miles of Pipe by Class Location
Onshore Type C gathering systems have been added to the table in which miles of pipe are to be reported by class location.
Part M1 – All Leaks Eliminated/Repaired in Calendar Year; Failures in HCA Segments in Calendar Year
This is where Onshore Type C gathering system leaks and failures eliminated, or repaired, in the calendar year will now be reported by cause.
Part M3 – Leaks on Federal Land or OCS Repaired or Scheduled for Repair
This is where Onshore Type C gathering system leaks repaired or scheduled for repair, on Federal Land or the OCS, are now to be reported.
The Enforcement Corner
The Enforcement Corner summarizes recent PHMSA enforcement actions, indicating where PHMSA is putting its enforcement efforts and the fines they are proposing for various types of violations.
In February 2022, PHMSA issued 2 CAOs, 14 WLs, 5 NOAs, and 9 NOPVs accompanied by $168,500 in proposed fines. Significant proposed fines were attributed to the following code sections:
- $22,800 – 49 CFR 195.420(b) – Valve Maintenance
- $22,800 – 49 CFR 195.428(a) – Overpressure Safety Devices
- $57,000 – 49 CFR 195.403(a)(2) – Emergency Response Training
- $46,600 – 49 CFR 192.717(b)(5) – Permanent Field Repair of Leaks
- $19,300 – 49 CFR 191.5(a) – Immediate Notice of Certain Incidents
- Pipeline operators may disagree in whole or in part with each proposed violation cited by PHMSA.
- Proposed Civil Penalties (PCP) may be reduced or eliminated before an enforcement action becomes final.
- A Corrective Action Order (CAO) usually addresses urgent situations arising out of an accident, spill, or other significant, immediate, or imminent safety or environmental concern.
- A Notice of Amendment (NOA) is frequently a result of a difference of opinion regarding written procedure requirements.
- A Notice of Proposed Safety Order (NOPSO) addresses pipeline integrity risks that may not constitute a hazardous facility requiring immediate corrective action (see Corrective Action Order described above),but do need to be addressed over time.
- A Notice of Probable Violation (NOPV) is not proof that a violation actually occurred.
- A Proposed Compliance Order (PCO) frequently documents actions the pipeline operator already planned to do.
- Warning Letter (WL) is an official notice by PHMSA that an operator needs to make improvements but that no further enforcement is proposed for those findings at this time.
RCP maintains a detailed database of all PHMSA enforcement actions dating back to 2007 and is routinely asked for data analysis of various enforcement actions. For more information on how RCP can assist with enforcement action data analysis services, contact Jessica Foley.
Need to respond to a PHMSA enforcement action?
Need to know if your enforcement action is an outlier, or par for the course?
RCP maintains a detailed database of all PHMSA enforcement actions and their resolution which enables us to compare and contrast individual enforcement actions to nationwide actions and trends. We can help put things into context to ensure an effective reply for each citation. For more information on how RCP can assist with enforcement action data analysis services, contact Jessica Foley.
RCP has a tradition of creating and sustaining trusted partnerships with the companies we serve. This has translated into long-term relationships that are based not only on the quality and scope of the work we provide, but also on the manner in which we provide it. We routinely hear from our clients with positive feedback like this quote below:
“‘THANKS” for all the hard work this week. Trying to meet the needs of so many “bosses” can be stressful and I appreciate the patience, commitment and perseverance with all this. Thanks for all the diverse knowledge and experience you brought to the table . . . this was by far and away the best test of their systems and processes they had ever experienced.” – API
We would welcome the opportunity to discuss our services with you.
W. R. (Bill) Byrd, PE