February 2006 Issue

In This Issue

Register Now for the DOT Pipeline Compliance Workshop

Feb. 22–23, Houston, Texas

Includes updates on Pipeline Integrity Management, SPCC rules, Public Awareness, Operator Qualification (B31Q) and Underwater Inspection & Reburial of Pipelines

RCP will conduct a 2-day workshop on DOT Pipeline Regulations on Feb. 22nd and 23rd in Houston.

PROGRAM SCHEDULE:
Day 1: Introduction to DOT/OPS Pipeline Regulations

Agency jurisdictions – what does DOT/OPS regulate anyway?
Important definitions
Important letters of clarification from the agency
Recent EPA/DOI memorandums of understanding
State and Federal program variations, roles and responsibilities
Gas and liquid design, construction, operations, maintenance, and emergency response requirements
Spill response planning requirements
How to monitor rulemaking activity and stay current with your compliance program

Day 2: Special Topics

Pipeline Integrity Management
Spill Prevention, Control & Countermeasure (SPCC)
Public Awareness
Operator Qualification – B31Q Update
Underwater Inspection & Reburial of Pipelines in the Gulf of Mexico
Other State and Federal Regulatory Agenda Items

This workshop is suitable for personnel who need a general introduction to DOT pipeline regulatory requirements, or who need an update on recent and proposed DOT Pipeline regulatory initiatives. We have conducted this type of seminar several times, and have received excellent feedback each time. We expect this workshop to fill up rapidly. Early registration and group discounts are available. Additional information is available on our website here.

Reconsideration of Natural Gas Pipeline MAOP for Class Locations

Docket No. PHMSA-05-23447

On March 21, 2006, the Pipeline and Hazardous Materials Safety Administration (PHMSA) will hold a public meeting to discuss raising the Maximum Allowable Operating Pressure (MAOP) on certain natural gas transmission pipelines. PHMSA also invites papers on relevant technical subjects.

Over the past 20 years, there has been a drastic improvement in technology pertaining to materials, metallurgy, controls, operations, and maintenance of the pipeline network. Based on these and other advances, PHMSA believes that certain pipelines in certain locations could be safely and reliably operated above the operating pressure established in current Federal pipeline safety regulation.

There are three categories of pipelines that could realize an immediate benefit from such an increase in the MAOP:

– the proposed Alaska Natural Gas Transmission System;
– new natural gas pipelines that are being certificated by the Federal Energy Regulatory Commission; and
– pipelines constructed since 1980 with line pipe of known metallurgical and mechanical properties.

International pipeline regulations generally limit design stresses to 72% specified minimum yield strength (SMYS). Under highly selective conditions, some pipelines in the United States and Canada operate at hoop stresses up to 80% SMYS. Notwithstanding, the current United States Code of Federal Pipeline Safety Regulations (CFR) (49 CFR part 192) limits the stress to 72% SMYS for Class 1 locations, while Canada limits it to 80%. There are a lot of other countries considering operating at higher levels. Therefore, PHMSA believes it is appropriate to explore the reliability and integrity implications of operating pipelines at stress levels above 72% SMYS, but not to exceed 80% SMYS for Class 1 locations.

The benefits of an increase in MAOP for natural gas pipelines are tremendous, mainly because of the increase in capacity and fuel efficiency. For new pipelines operated at a higher MAOP, operators might realize an initial cost savings, primarily in materials. A capacity increase in existing pipelines will have an auxiliary benefit by avoiding the construction of new pipelines or costly modifications that have the potential to damage the environment. Historical problems associated with seam failures are non-existent with new materials. Most new pipelines have been configured to accept inline inspection tools to monitor the pipeline’s condition. Pipeline operators have improved their ability to manage internal corrosion. By allowing pipeline companies to safely increase the MAOP of existing pipelines that meet certain criteria, they could avoid new construction that can affect the environment.

Research by the Pipeline Research Council International concluded that pipeline operations can be safe and reliable at stress levels of up to 80% SMYS if the pipeline has well-established metallurgical properties and can be managed to protect it against known threats, such as corrosion and mechanical damage. Additionally, independent studies demonstrate the benefits of risk and reliability-based principles that strengthen safety.

This meeting provides the pipeline industry, Federal and State regulators, and interested members of the public an opportunity to share their knowledge and experience about the impact of increasing the MAOP to increase pipeline efficiency. Individuals that would like to make presentations should notify Mr. Joy Kadnar, Director, Engineering and Emergency Support at (202) 366-4595 or joy.kadnar@dot.gov by Feb. 7, 2006, and submit papers at this meeting.

The meeting will be held at the Hyatt Regency Reston Hotel, 1800 Presidents Street, Reston, VA 20190. The telephone number for reservations at the Hyatt Regency Reston Hotel is (703) 709-1234. The hotel will post the particular meeting room the day of the meeting.

Pipeline Safety: Mechanical Damage Technical Workshop

[Docket No. PHMSA-2005-23198]

As mentioned in our January newsletter, PHMSA and the National Association of Pipeline Safety Representatives (NAPSR) are hosting a workshop on Tuesday, Feb. 28 and Wednesday, March 1, 2006, at the Houston Marriott Westchase to address pipeline safety issues with mechanical damage. This workshop will provide a forum to share information on mechanical damage among pipeline operators, state agencies, technical experts, and the public. Workshop attendees will discuss and see existing and future technology used to prevent, detect and characterize mechanical damage. Participants will discuss and learn about prevention, detection, and characterization technologies for mechanical damage. This information will aid PHMSA in coordinating actions to address the problems mechanical damage poses in operating natural gas and hazardous liquid pipelines.

To facilitate meeting planning, advance registration is strongly encouraged. Please visit the Meeting Registration and Document Commenting web page ( http://primis.phmsa.dot.gov/meetings/) where PHMSA will post details about the meeting.

Integrity Management Services

RCP can assist pipeline operators with ongoing compliance management and engineering associated with your IMP. This includes direct assessment strategies, tool and vendor selection, ILI/ECDA report analysis, corrosion control programs, repair strategies, and IMP/risk model updates. For more information on how RCP can support your ongoing IMP needs.

Hurricane Impacts in the Gulf of Mexico

The US Minerals Management Service (MMS) has just released its analysis of the effects of Hurricanes Katrina and Rita on oil and gas production in the Gulf of Mexico. The report details:

the destruction of 115 oil platforms and the damage of 52 others;
the damage of 183 pipelines, 64 of those major pipelines larger than 10″ in diameter; and
418 “minor” pollution incidents. (A minor incident is less than 500 barrels of oil spilled that doesn’t reach the coastline.)

Hurricanes Katrina and Rita were the greatest natural disasters to oil and gas development in the history of the Gulf of Mexico according to Chris Oynes, Regional Director of the U.S. Minerals Management Service. MMS estimates that 3,050 of the Gulf’s 4,000 platforms and 22,000 of the 33,000 miles of Gulf pipelines were in the direct path of either of the hurricanes.

Because of the large amount of infrastructure in the path of hurricane-force winds and waves, the amount of damage was substantial. Category 4 Rita actually caused more destruction and damage than Category 5 Katrina, according to the tally, due to its path.

The full MMS report is available at: http://www.mms.gov/ooc/press/2006/press0119.htm.

Need to Update your Response Plan (FRP, ICP or OSRP)?

We have the expertise to update your Facility Response Plan, Integrated Contingency Plan, or Oil Spill Response Plan to include new guidance and lessons learned from recent incidents and natural disasters.

Hurricane Response Conference Set For March

API has scheduled an Industry Hurricane Preparedness and Response Conference for March 1-2 at the Marriott Intercontinental Airport Hotel in Houston to consider the overall impact of the 2005 hurricanes, learn best practices, share lessons learned, and discuss issues associated with infrastructure performance.

For additional information, contact: Susan Sherwood, Meeting and Conference Services, 202-682-8187 or sherwoods@api.org.

O&M Manual Up-To-Date?

RCP has the tools and expertise to develop comprehensive procedures that you need to protect your people, facilities, and environment.

Safe Excavation and Backfilling Advisory

Advisory Bulletin (ADB-06-01)

The Pipeline and Hazardous Material Safety Administration recently issued this advisory bulletin to both gas and liquid operators. The preamble to the advisory gives a summary of several excavation-related accidents in the past few years that all involved some failure to follow established safe excavation practices. The complete advisory is available on PHMSA’s website at: http://www.phmsa.dot.gov.

To: Owners and Operators of Natural Gas and Hazardous Liquid Pipeline Systems

Subject: Notification on safe Excavation Practices and the use of Qualified Personnel to oversee all Excavations and Backfilling Operations

Advisory: Excavation damage continues to be one of the three leading causes of pipeline damage. PHSMA has seen an increase in pipeline operators damaging their own pipeline facilities. To protect excavators and private citizens from injury and to guard the integrity of buried pipelines and other underground facilities, PHSMA reminds operators to ensure all procedures and processes to preform excavation and backfilling are followed. Only qualified personnel must oversee all marking, trenching, and backfilling operations.

Furthermore, PHMSA reminds pipeline operators that although excavation is not explicitly addressed in 49 CFR parts 192 and 195, excavation is considered a covered task under the pipeline operator qualifications regulations (49 CFR 192.801-809 and 195.501-509). These regulations require that pipeline operators and contractors be qualified to preform pipeline excavation activities. A qualified individual is one who has been evaluated and can preform assigned covered tasks and can recognize and react appropriately to abnormal conditions.

In particular, PHSMA recommends pipeline operators review the adequacy of covered tasks involving line locating, one-call notifications, and inspection of excavation of excavation activities. Operators should also review the adequacy of required training, evaluation and qualification methods for each of these covered tasks to ensure that each employee and contractor is qualified to preform that task.

OPS Clarification of Public Awareness Requirements

The Pipeline and Hazardous Materials Safety Administration posted Public Awareness Program frequently asked questions on the PHMSA Stakeholder Communications web site, http://primis.phmsa.dot.gov/comm/PublicEducation.htm.

Several questions have been raised about question 4: When must an operator complete the initial distribution of RP 1162-compliant communications to stakeholders? According to PHMSA, the answer depends on the RP 1162 frequency for communicating with the audience.

A “base date” of June 20, 2006, applies to all operator types and audiences. The initial distribution of awareness materials must be completed by the “base date” plus the RP 1162 frequency.

For example, gas distribution operators must deliver awareness materials to customers by Dec. 20, 2006. All operator types must deliver awareness materials to local public officials by June 20, 2009. (This does not reflect the supplemental delivery frequency for transmission operators located in high consequence areas [HCAs]. RP 1162 states that operators with facilities located in HCAs must make annual contact with public officials at a minimum, or more often as appropriate.)

Public Awareness Programs must be completed by the “base date” of June 20, 2006. There is no requirement for awareness materials to be delivered by the “base date.” The due date for delivery of awareness materials to stakeholders is calculated by a simple formula – “base date” plus the frequency specified in RP 1162.

Many people have noticed that the answer differs from what PHMSA presented at the workshops. At the workshops, PHMSA stated that “Initial distribution of awareness materials must be completed by June 20, 2007.” Based on feedback from industry after the workshops, PHMSA determined that a single date for completion is not appropriate. Hence the new FAQ.

PHMSA expects to issue an Advisory Bulletin in April 2006 that will provide detailed instructions for operators to submit written programs.

Need to make sure your Public Awareness Program meets API RP 1162 standards?

RCP can conduct a gap analysis of your current program that includes a self assessment of your Public Awareness Programs. This final product will help you to meet API RP 1162 standards. We can provide turnkey implementation, mail-outs, evaluations, and tracking of your program.

Liquid Pipeline Integrity Data on the Web

The Pipeline and Hazardous Materials Safety Administration is testing a web site to allow users to view hazardous liquid integrity management performance measures data. The site will be updated annually after annual reports are submitted.

PHMSA also plans to post analogous data for the natural gas transmission liquid industry. These data for both industries are available in unaggregated form already in PHMSA’s online data library.

The temporary web address is http://opsweb.rspa.dot.gov/gasimp/analysis_liquid. The address is expected to change, and we will provide you with the new address in next month’s Pipeline Compliance News.

RCP Services Spotlight – RCP Auditing, Due Diligence and Expert Witness Services

RCP’s approach to audits and assessments is typically either consultative or enforcement oriented depending upon the client’s needs. The consultative approach is typically viewed by clients as a cooperative effort that assesses regulatory compliance status in concert with operational and maintenance issues. This method provides feedback on existing management practices versus industry standards. The consultative approach not only identifies opportunities for regulatory compliance improvement, but also provides recommendations on how existing management practices can effectively achieve and sustain these improvements. An enforcement approach gives the client an idea of how well a facility can manage an agency audit and how likely it would be for an agency inspector to issue a Notice of Violation.

RCP provides comprehensive, confidential regulatory consulting services, including:

Quick-Hit Regulatory Compliance Checkups
Comprehensive Regulatory Compliance Audits
- Compliance program gap analysis
- Recordkeeping evaluation
- Field inspections
Regulatory Agency Jurisdictional Determinations, Interpretations & Audits
- DOT
  - Integrity Management Program
  - Operator Qualification
  - Operations & Maintenance
  - Public Awareness API RP1162
  - Facility Response Plans
- U.S. Coast Guard
  - Dock Operations
  - Oil Spill Response Plans
  - Facility Security Plans
- EPA
  - Spill Prevention Control & Countermeasure Plans
  - Air/Wastewater Permitting
  - Facility Response Plans
  - Risk Management Plans
- OSHA
  - Process Safety Management
  - Health & Safety Plans
- FERC
  - NEPA Pre-filing
  - Environmental Compliance and Report Planning
- State-Specific Regulations
Asset Acquisition Due Diligence
- Phase I Environmental Assessments
- Permitting & Associated Agency Notifications
- Compliance Program Development
- Employee Qualification & Training Program Assessments
- Asset Integrity Management Liability Assessment
- Record Keeping, Documentation & Data Room Inspections
Expert Witness Service
- Pipeline Safety
- Regulatory Interpretation

If you would like information regarding RCP’s Auditing, Due Diligence and Expert Witness Services, e-mail Jessica Roger or call (713) 655-8080.

Gas Gathering Line – Definition, TPSSC Meeting

On Jan. 19, 2006, the Technical Pipeline Safety Standards Committee (TPSSC) voted in favor of the proposed rule to use consensus standards to distinguish onshore gathering lines, to establish safety standards for certain higher-risk onshore gathering lines, and to change current standards on low-risk onshore gathering lines. At present, PHMSA’s safety standards do not apply to onshore gathering lines in rural locations, while onshore gathering lines in non-rural locations must meet the same requirements as transmission lines. This regulatory approach is insufficient to assure that conditions on gathering lines that pose a greater risk to the public and property are addressed. And it does not take into account the lower risk some other gathering lines pose. The intended effects of the proposed rules are improved identification of gathering lines, improved public confidence in the safety of gathering lines, and safety requirements better tailored to gathering line risks.

PHMSA is proposing use of a consensus standard to distinguish onshore gathering lines. PHMSA’s gas pipeline safety standards do not provide an adequate basis for distinguishing these pipelines from production facilities and transmission lines. In addition, PHMSA is proposing to establish safety standards for certain higher-risk onshore gathering lines, and to relax current standards on certain low-risk onshore gathering lines. (Onshore gathering lines in inlets of the Gulf of Mexico are not affected.) Operators would use a new risk-based approach to determine which of its gathering lines are “regulated onshore gathering lines” and what safety standards the lines must meet.

Federal law requires PHMSA to submit cost-benefit analyses and risk assessment information on each proposed safety standard to the advisory committees. The TPSSC evaluates the merits of the data and, when appropriate, provide recommendations on the adequacy of the cost-benefit analyses. The TPSSC voted on the reasonableness, cost-effectiveness, and practicability of this proposed regulation.

PHMSA will issue a final rule based on the proposed rule, the comments received from the public, and the vote and comments of the advisory committee.

Need to Update Your Current Operator Qualification Program?

We have the expertise to update your current operator qualification program to satisfy the upcoming regulation change and inspection protocols.

New Chief of PHMSA?

President Bush nominated Thomas J. Barrett, of Alaska, to be Administrator of the Pipeline and Hazardous Materials Safety Administration at the Department of Transportation. Vice Admiral Barrett currently serves as Chief Operating Officer and Vice President of the Potomac Institute for Policy Studies. Prior to this, he served the United States Coast Guard for more than 35 years, retiring as Vice Commandant. Vice Admiral Barrett received his bachelor’s degree from LeMoyne College and his JD from The George Washington University.

Barrett is the former commander of the Coast Guard in Alaska and of the base in Kodiak.

PHMSA Web Site Initiative

(from OPS’s website)

PHMSA is currently conducting a “Web Presence Needs Assessment” as part of an overall effort to improve the PHMSA websites and access to electronic information and services by PHMSA stakeholders and customers and the public. The new “One PHMSA” web presence will serve PHMSA’s stakeholders, customers, and the American public while enabling PHMSA to provide for the safe, secure, reliable, and efficient transport of products essential to America’s way of life. It will attract and retain customers by focusing on PHMSA’s mission and strengths, creating a user-friendly environment, and providing the opportunity to communicate with PHMSA. The content will be the most current information available and will be presented in a standard format. Leveraging current technology and innovations, this new web presence will:

Enable customers and stakeholders to find information and services faster and easier
Educate customers, stakeholders, and the public about PHMSA’s role and mission in the safe and secure transportation of hazardous materials
Ensure robustness of content and data
Provide a wide variety of on-line transactions to customers and stakeholders
Foster greater two-way collaboration and communication with customers and stakeholders
Employ intuitive and easy-to-use features
Reduce costs and effort for development, maintenance, support and content management

PHMSA is looking for your input, ideas, comments, and suggestions to improve the web sites and your PHMSA web experience. Also, let us know if you experience any technical problems with the sites, or have any suggestions for improving them. Finally, let us know about the possible need for additional information or services. Please contact the “One PHMSA” Web Initiative Webmaster at PHMSA.Web.Initiative@dot.gov to share your ideas, problems, issues, and needs.

RCP’s Fantastic 1-Page Version of SPCC Regulation

The Feb. 17, 2006, deadline for SPCC Plan revisions is fast approaching. (Although the deadline may be extended, the extension is not yet final). RCP has developed a 1-page version (in tiny type) of the SPCC regulations that includes the guidance document for inspectors that was issued Dec. 2, 2005. To receive a complimentary copy along with a CD of valuable SPCC Reference Materials, Click Here.

Excavation Monitoring and Observation

API RP 1166

Excavation damage is a major cause of pipeline incidents and personal injuries. The American Petroleum Institute has recently released the first edition of Publication 1166, Excavation Monitoring and Observation, designed to protect the public, excavation employees, and the environment by preventing damage to pipelines from excavation activities, and to provide a consistently applied decision-making process for monitoring and observing excavation and other activities on or near pipeline rights-of-way.

To order Publication 1166, go to http://www.global.ihs.com and search for the keyword “excavation.” The cost for non-API members is $85. For information, contact Andrea Johnson at (202) 682-8107 or johnsona@api.org.

Will your SPCC Plan pass an EPA inspection based on the new SPCC Inspectors’ Guidance document?

RCP can conduct a gap analysis of your current SPCC Plan and provide updates and recommendations based on the new SPCC Guidance for Regional Inspectors that was published Dec. 2, 2005. The new guidance document includes more detail than is in many of the plans in use today.

RCP can review and update your plan so that you will be prepared for an Inspection. For more information, call or Click Here.

Revision to Gas Integrity Management Inspection Protocols

The Pipeline and Hazardous Materials Safety Administration (PHMSA) has made some minor changes to the Gas Integrity Management inspection protocols, based on the 2005 inspection experience.

Some protocols were combined, resulting in the deletion and renumbering of several protocols. Others were edited for corrections or clarification.

M.02.a was edited to clarify that it applies when a covered segment is located in a State where OPS has an interstate agent agreement.
D.06.c was moved to D.07.e and edited to indicate it applies to the “pre-assessment and region identification.” The old D.06.c was deleted.
D.06.c moved to D.08.e and edited to indicate it applies to the “direct assessment.”
D.06.c was moved to D.09.d and edited to indicate it applies to the “post-assessment.”

For the most current inspection protocols and a summary of the changes, see the Implementing Integrity Management website at http://primis.phmsa.dot.gov/gasimp/documents.htm.

Bill Byrd signature
W. R. (Bill) Byrd, PE
President
RCP Inc.

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