DOT Pipeline Compliance News

January 2004 Issue

In This Issue

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DOT/OPS Issues Final Gas Pipeline Integrity Management Rule

DOT/OPS issued the long anticipated pipeline integrity management rule for gas transmission pipelines on December 12, 2003. The rule is contained in a new Subpart O of §192. The rule is very detailed and specifies requirements for Operators in performing assessments, data collection, integration and analysis, repair and remediation action, implementation of preventative and mitigation measures, assessments intervals and a modified definition of what constitutes a High Consequence Area from that published in the draft rule last January. The rule also makes extensive use of and reference to ASME B31.8S-2001. DOT/OPS has established a website at primis.rspa.dot.gov/gasimp containing the rule’s text and other relevant gas integrity management topics.

One of the most important elements of the new rule is the identification of transmission pipeline segments located in HCA’s. Operators are given the option of two methods to make this determination. These methods may be used exclusively or in combination. One method defines HCA’s as (i) Class 3 or 4 locations, (ii) an area outside a Class 3 or 4 location having a Potential Impact Radius greater than 660 feet and containing more than 20 buildings intended for human occupancy within the Potential Impact Circle or (iii) an area within a Potential Impact Circle containing an Identified Site as defined in §192.903. The alternative method specified HCA’s as the area within (i) a Potential Impact Circle containing 20 or buildings intended for human occupancy or (ii) an Identified Site. Pipeline segments located in HCA’s are called Covered Segments. The algorithm to calculate a Potential Impact Radius is specified in the rule.

The rule also specifies deadlines for implementing a gas pipeline integrity management plan. An Operator of Covered Segments is required to develop and implement a written integrity management plan by December 17, 2004. An Operator’s plan must contain the sixteen elements specified in §192.911. An Operator must complete initial integrity assessments for 50% of the highest risk Covered Segments by December 17, 2007 and the remaining 50% by December 17, 2012. An assessment made prior to December 17, 2002 may be used as an initial if the assessment activities satisfy requirements of the rule including remedial actions.

An Operator is required to determine the risk associated with each Covered Segment. This includes evaluation of several classes of threats to pipeline integrity. These consist of time dependent threats such as internal and external corrosion, static threats such as construction defects, time dependent threats such as third party damage and human error. Consequences of a leak or rupture must also be considered when determining the risk for a Covered Segment.

Operators have some choices in selecting the assessment methods to be used. The choice is to be governed by the method best suited to address the threats identified for a Covered Segment. An Operator may use in-line inspection tools, pressure testing in accordance with Subpart J of §192, direct assessment or other technology that the Operator demonstrates provides equivalent understanding of the pipe’s condition. Four sections of the rule are devoted to the use of direct assessment.

Operators are required to take prompt action to address all anomalous conditions discovered during an integrity assessment. §192.933 contains requirements for establishing Discovery of a Condition, schedule for evaluation and remediation and special requirements for scheduling remediation of immediate repair, one year and monitored conditions.

Requirements for preventative and mitigation measures to protect HCA’s are contained in §192.935. §192.937 specifies elements of an Operator’s process for continual evaluation and assessment.

§192.939 establishes the required reassessment intervals for Covered Segments. The minimum reassessment interval is set at seven years. However depending on the MAOP hoop stress/SMYS ratio, an Operator may extend the time period for completing one or more subsequent assessments using in-line inspection tools, pressure testing or direct assessment by using Confirmatory Direct Assessment (described in §192.931) within specified time intervals. §192.939 contains a table that shows the reassessment intervals allowed by the rule when using Confirmatory Direct Assessment.

The rule also contains requirements for methods to measure a program’s effectiveness (§192.945), record keeping requirements (§192.947) and OPS notification procedures (§192.949).

RCP has developed and / or assisted pipeline operators with 28 pipeline integrity management programs to-date. Our breadth of experience enables us to develop quality integrity management plans, on time and within budget. If you require assistance with any portion (or all) of your integrity management program, please contact our Vice President of Business Development, Mr. Dan Shelledy, at dshelledy@your-rcp.com.

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Stress Corrosion Cracking Meeting Materials

The Office of Pipeline Safety (OPS) and the National Association of Pipeline Safety Representatives (NAPSR) cosponsored a workshop on stress corrosion cracking (SCC) with the pipeline industry trade associations on Tuesday, December 2, 2003 in Houston Texas (see our November, 2003 newsletter). The workshop provided a forum for the discussion of SCC phenomena in both gas and hazardous liquid pipelines. Workshop documents have now been posted at the following website:

primis.rspa.dot.gov/gasimp/mtg_120203.htm

RSPA/OPS recently issued an Advisory Bulletin to remind owners and operators of gas transmission and hazardous liquid pipelines to consider SCC as a risk factor when developing and implementing Integrity Management Plans. All owners and operators of pipeline systems, whether or not their pipeline systems are subject to the Integrity Management Plan rules, should determine whether their pipeline system is susceptible to SCC and assess the impact of SCC on pipeline integrity. Based on this evaluation an operator should prioritize application of internal inspection, hydrostatic testing, or other forms of integrity verification.

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OCS Rights-of-Use and Easement and Pipeline Rights-of-Way

The Minerals Management Service (MMS) is modifying requirements governing rights-of-use and easements and pipeline rights-of-way on the Outer Continental Shelf (OCS). These changes will increase rental rates for pipeline rights-of-way and establish rentals for rights-of-use and easements. This change is needed because of requests made by lessees and pipeline right-of-way holders to use large areas outside of the area covered by their lease and pipeline right-of-way for accessory structures. This rule will require holders of rights-of-use and easements and holders granted use of large areas as part of a pipeline right-of-way to pay rentals on a per acre basis.

This rule is effective January 12, 2004. FOR FURTHER INFORMATION CONTACT: John Mirabella, Chief, Office of Offshore Regulations, (703) 787-1600.

For the complete rule, including rates, please contact Dan Shelledy at dshelledy@your-rcp.com.

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Periodic Underwater Inspections: Notice of Proposed Rulemaking

The Office of Pipeline Safety is proposing to amend the pipeline safety regulations to require operators of gas and hazardous liquid pipelines to have procedures for periodic inspections of pipeline facilities in offshore waters less than 15 feet deep or crossing under a navigable waterway. These inspections would ensure that the pipeline is not exposed or a hazard to navigation.

RSPA/OPS proposes that owners and operators of these underwater pipeline facilities be required to develop procedures to conduct periodic underwater depth of burial inspections of their submerged pipelines. The procedures would assess the risk of a pipeline becoming exposed or a hazard to navigation by taking into account the particular dynamics of the water bottom, including the probability of flotation, scour, erosion, and the impacts of major storms. The operator should also establish a timetable for inspection of underwater pipelines based on their risks.

RSPA/OPS requests comments from industry and the public on the following topics:

1. Performance Versus Prescriptive
2. Hazard to Navigation
3. Navigable Waters
4. Reporting Requirements
5. Marking Exposed Pipelines Pending their Reburial
6. Reburial Requirements
7. Abandoned Pipelines
8. Exposed Pipeline
9. Gulf of Mexico and Its Inlets
10. Underwater Natural Bottom

Interested persons are invited to submit written comments by February 10, 2004 [Docket Number RSPA-97-3001]. Late-filed comments will be considered to the extent practicable.

The full proposal can be obtained from Dan Shelledy at dshelledy@your-rcp.com.

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Notice of Minimum Annual Percentage Rate for Random Drug Testing

Each year, pipeline operators randomly select employees to test for prohibited drugs. The number of employees selected may not be less than the minimum annual percentage rate the Research and Special Programs Administration’s (RSPA) Office of Pipeline Safety (OPS) determines, which is either 50 percent or 25 percent of covered employees based on the industry’s positive rate of random tests. In accordance with applicable standards, RSPA/OPS has determined that the positive rate of random drug tests reported by operators this year for testing done in calendar year 2002 is less than 1.0 percent. Therefore, in calendar year 2004, the minimum annual percentage rate for random drug testing is 25 percent of covered employees.

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Reorganization of the Office of Pipeline Safety

(or: RSPA to RITA, OPS to FRPA, PDQ!)

The Secretary of the Department of Transportation intends to reorganize the Research and Special Programs Administration (RSPA). RSPA currently houses several functions that relate to operations (such as the Office of Pipeline Safety), and bear little relation to the basic research functions of that Administration. Similarly, several of the important research and analytical capabilities that could better support RSPA’s research programs are fragmented in other parts of the Department. The reorganization will transform the existing RSPA into a new organization within the Department, to be designated as the Research and Innovative Technology Administration or (RITA).

Meanwhile, the Office of Pipeline Safety will move from RSPA to the Federal Railroad Administration (FRA), which would be renamed the Federal Railroad and Pipeline Administration (FRPA). There are three main reasons for this new alignment:

1. Rail and pipelines are fixed transportation structures, and in some cases, they share the same rights of way.
2. The pipeline system looks and operates more like the rail system than any other mode of transportation.
3. Both FRA and the Office of Pipeline Safety focus on safety regulation, enforcement and penalty collection issues. The ability of the Office of Pipeline Safety to perform those functions will be improved by placing its program within an Administration with long experience in those areas.

The initial steps toward rolling out this proposal are being taken, but a great deal has yet to be done. The Secretary would like to begin operating under the new plan no later than early next fiscal year.

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NESHAP – Bulk Gasoline Terminals and Pipeline Breakout Stations

On August 18, 1983, the EPA promulgated Standards of Performance for Bulk Gasoline Terminals (48 FR 37590). The 1983 standards of performance limit and control emissions of volatile organic compounds (VOC) that react with other pollutants to form ozone (or smog) which has been linked to respiratory impairment and eye irritation, and negatively affects vegetation and ecosystems. On December 14, 1994, EPA promulgated National Emission Standards for Gasoline Distribution Facilities (Bulk Gasoline Terminals and Pipeline Breakout Stations) (59 FR 64318). The 1994 national emission standards limit and control hazardous air pollutants (HAP) that are known or suspected to cause cancer or have other serious health or environmental effects.

On September 20, 2002, EPA proposed amendments to the 1983 standards of performance and 1994 national emission standards to provide for the use of alternative leak test procedures for railcars under the 1994 national emission standards, a clarification on monitoring flares and thermal oxidation systems used to comply with the 1994 national emission standards, alternative recordkeeping requirements for tank trucks and railcars under the 1983 standards of performance and 1994 national emission standards, and the use of flare design specifications under the 1983 standards of performance by incorporating the allowance in the text of that final rule. This document takes final action on those proposed amendments. The amendments do not change the level of control or compromise the environmental protection achieved by the 1983 standards of performance and 1994 national emission standards, but provide clarification and alternatives that enhance the flexibility of the recordkeeping and testing requirements of the two final rules.

For a copy of the amended rule, please contact our Vice President of Business Development, Mr. Dan Shelledy, at dshelledy@your-rcp.com.

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Advisory Bulletin (ADB-03-09) Re: Potential Service Disruptions in SCADA Systems

The Office of Pipeline Safety recently issued the following notice and gas and liquid pipeline operators. For a complete copy of the notice, please contact our Vice President of Business Development, Dan Shelledy, at dshelledy@your-rcp.com.

Each pipeline owner or operator should review their procedures for the upgrading, configuring, maintaining, and enhancing its SCADA system. If not well thought out and thoroughly tested, such changes could cause inadvertent service disruptions in the SCADA system. Resulting conditions could may impede controllers responsible for operating the pipeline from promptly recognizing and reacting to abnormal conditions, and could potentially impact the controllers’ abilities to restore normal operations. Owners and operators should ensure that SCADA system modifications do not degrade overall SCADA performance to an unacceptable level. To further reduce the potential effect of service disruptions, responsible personnel should coordinate significant and non-routine SCADA modifications to occur at times when no significant changes to pipeline operations are anticipated.

It is good practice for owners and operators of pipeline systems to periodically review their SCADA system configurations, operating procedures, and performance measurements to ensure that the SCADA computer servers are functioning as intended. Owners and operators should consider using off-line or development workstations/servers to help ensure that impending changes are tested as thoroughly as possible before moving the changes into production. Although off-line or development workstations can be valuable, they may not fully represent timing, load and other factors that will be present in the production environment. System modifications should be implemented via structured and managed processes to reduce the likelihood of unforeseen problems. Such controlled processes are especially important if an owner or operator makes changes directly in the on-line environment.

In addition, owners or operators should periodically confirm that associated design and maintenance personnel, whether employees, contractors, or third-party providers, are adequately skilled to perform SCADA system modifications without causing undesirable consequences. These same personnel should be cognizant of the critical system attributes that should be monitored during the testing phase of implementation.

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The Texas Railroad Commission to Hold the 54th Annual State of the Industry Meeting

The Railroad Commission’s 54th Annual State of the Industry meeting is scheduled for January 28, 2004 at 1:00 pm to 5:00 pm in Room 1.111 of the William B. Travis Office Building, Austin. This year’s meeting will feature a new format with invited speakers. Special guest speaker is Texas Governor Rick Perry.

Invited speakers will address oil and gas activities in their respective locations to explain the overall condition of industry activity in the state. The agenda can be found at www.rrc.state.tx.us/meetings-seminars/soi2003/stateofindustryagenda.pdf.

Public comment/testimony will be welcome this year in the form of written comments. These comments will be posted to the Railroad Commission website following the meeting and should be submitted in an electronic format on or before January 27, 2004 to dee.wright@rrc.state.tx.us. Written copies of public comment will also be accepted at the meeting at the registration table. To register for the meeting, complete the response form found at www.rrc.state.tx.us/meetings-seminars/soi2003/stateofindustryform.pdf by January 15. Pre-registration is required for the luncheon.

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Texas Railroad Commission to begin Formulation of Texas Energy Plan

The Texas Railroad Commission issued a press release in December announcing that Governor Rick Perry launched the development of a state energy plan. This includes an executive order creating the Texas Energy Planning Council. Victor G. Carrillo, chairman of the Texas Railroad Commission, will chair the effort. The Energy Planning Council’s focus will be on enhancing energy production, technologies and improving energy conservation. For the entire press release, go to www.rrc.state.tx.us/news-releases/2003/031218vc.html.

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OPS, PRCI and GTI Hosts Pipeline R&D; Forum

The Office of Pipeline Safety (OPS) along with the Pipeline Research Council International, Inc. (PRCI) and the Gas Technology Institute (GTI) hosted a Pipeline R&D; Form on December 11-12, 2003. The forum focused on the Role of the Pipeline Safety Improvement Act of 2002 (PSIA) and the development of Energy Pipeline Technology. This meeting was held to identify impact and opportunities resulting from the R&D; provisions in the PSIA and identity the challenges facing industry and government. The complete agenda can be found at primis.rspa.dot.gov/rd/mtg_121103.htm.

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TCEQ Releases 2003 Enforcement Report

State law requires the Texas Commission on Environmental Quality to prepare an electronic enforcement report by December 1 each year that reports on the enforcement actions for each type of regulatory program in the agency. This report can be found at www.tnrcc.state.tx.us/enforcement/AER/FY03/EnfRptFY03.pdf. This enforcement report contains statistical indicators and a comparative analysis for the following enforcement related activities:

• number of investigations and complaints by program and region;
• number of notices of violation issued by program and region;
• number and type of enforcement actions and lists of each action denoting the regulated entity name and location by county and region;
• amount of penalties assessed, deferred, and required to be paid to General Revenue;
• supplemental environmental project costs, offsets, and descriptions;
• number and percentage of enforcement actions issued to persons who previously have committed the same or similar violations;
• number and percentage of enforcement orders issued to entities that have been the subject of a previous enforcement order;
• classification of violations as major, moderate, or minor;
• most frequently cited rules/statutes in enforcement actions;
• emissions events;
• complaint assessment; and
• other information which the Commission deems relevant, including information on the results of enforcement actions (i.e., environmental benefit, pollutant reductions, etc.).

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API Recommended Practice 1162: Public Awareness Programs for Pipeline Operators Finalized

API RP 1162 Finalized (from API’s website):

The American Petroleum Institute has issued new guidance to U.S. pipeline operators to improve public awareness of pipelines. The purpose of the guidelines, known as Recommended Practice 1162 or Public Awareness Programs for Pipeline Operators, is to reduce pipeline accidents, which are often attributable to digging by homeowners, contractors, and farmers.

Pipeline companies have long conducted public awareness programs, but the federal Pipeline Safety Improvement Act of 2002 established new standards. RP 1162 is designed to help companies meet them.

In preparing RP 1162, API collaborated with federal and state regulators and representatives of natural gas and liquid transmission companies and local distribution companies.

Although pipelines are the safest and most economical way to distribute oil and gas, the oil and natural gas industry recognizes that development of open areas means more homes and businesses are close to pipelines. It believes that everyone living or working near pipelines should understand how they work, why they are important, how problems can be avoided, and what to do in the unlikely event something goes wrong.

RP 1162 identifies audiences to be contacted, effective messages and communications methods, and information for evaluating and updating public awareness programs. Potential audiences for a program meeting RP 1162 standards include public officials and local and state emergency response agencies as well as the public and commercial and agricultural excavators. RP 1162 applies to operators of both liquid and gas pipelines.

After reviewing RP 1162, the U.S. National Transportation Safety Board, an independent agency that investigates transportation accidents, including pipeline accidents, concluded the new guidelines met its recommendations for improved public awareness programs.

To order RP 1162, contact Global Engineering Documents at 1-800-854-7179 or www.global.ihs.com.

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Drug and Alcohol Management Information System Reporting

Each of the Department of Transportation’s drug and alcohol testing rules include requirements for select employers to submit drug and alcohol testing data to five Department of Transportation (DOT) agencies. In the past, these employers have been required to use agency-specific Management Information System (MIS) forms for this purpose, twenty-one different forms in all. The Department recently published a final rule revising these DOT agency MIS forms and transforming them into a single one-page form for use throughout all the DOT agencies. The requirement for use of the form is now in 49 CFR part 40. By this action, the DOT agencies endorse the use of this single form within their regulated industries, provide their regulated employers with guidance for submission of the form, and amend their rules accordingly. The DOT agencies are: Federal Motor Carrier Safety Administration (FMCSA); Federal Aviation Administration (FAA); Federal Transit Administration (FTA); Federal Railroad Administration (FRA); and Research and Special Programs Administration (RSPA).

Editor’s note: RSPA is the agency that regulates pipelines.

This final rule is effective December 31, 2003.

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Pipeline Safety: Meetings of the Pipeline Safety Advisory Committees [Docket No. RSPA-98-4470]

Meetings of the Technical Pipeline Safety Standards Committee (TPSSC) and the Technical Hazardous Liquid Pipeline Safety Standards Committee (THLPSSC) will be held from Tuesday, February 3 to Thursday, February 5, 2004, at the Washington-Dulles Airport Marriott Hotel, Dulles, Virginia. The Office of Pipeline Safety (OPS) will provide briefings on pending rulemakings and regulatory initiatives. The advisory committees will discuss various proposed rulemakings and associated risk assessments.

Members of the public may attend the meetings at the Washington-Dulles Airport Marriott Hotel, 45020 Aviation Drive, Dulles, Virginia. The exact location and room number for this meeting will be posted on the OPS Web page approximately 15 days before the meeting date at ops.dot.gov.

An opportunity will be provided for the public to make short statements on the topics under discussion. Anyone wishing to make an oral statement should notify Jean Milam, (202) 493-0967, not later than January 16, 2004, on the topic of the statement and the length of the presentation. The presiding officer at each meeting may deny any request to present an oral statement and may limit the time of any presentation.

FOR FURTHER INFORMATION CONTACT: Cheryl Whetsel, OPS, (202) 366-4431 or Richard Huriaux, OPS, (202) 366-4565.

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RCP Services Spotlight – Pipeline Integrity Management

RCP has been involved in 28 Pipeline Integrity Management Programs to date including the development of 15 complete programs for both large and small companies or industrial facilities. RCP has experience in Integrity Management Programs for both gas and hazardous liquids pipelines. These services include the following:

• Plan Development – RCP can start from scratch or use your existing program to complete a comprehensive plan to meet the latest regulations. RCP has a proven Risk Assessment Model to evaluate your pipeline segments and prioritize your future work as part of your Integrity Management Program.
• Program Audits – RCP will audit your existing Integrity Management Plan using DOT/OPS protocols and make recommendations for improvements or assist you in performing the required plan modifications. Our experts have participated in several DOT audits and can provide you with valuable insight as to how your program will perform under a comprehensive DOT IMP audit.
• Integrity Management Workshops / Training – RCP holds several DOT Workshops throughout the year which provide excellent training for those who are new to Integrity Management and for experienced pipeline professionals who need to learn the most recent changes in the regulations. We can provide this training on site at your facilities and tailor the program to your specific needs.
• Mapping Services / HCA Assessments / NPMS Submittals/ Class Location Studies – RCP provides a host of other relates services and special projects related to all aspects of Integrity Management and DOT Pipeline Compliance.

Please Click Here if you would like information on RCP’s Integrity Management Services and receive a copy of our FREE Integrity Management CD which includes a “Bookmarked” PDF file copy of the new Gas Integrity Management Rule and one of our recent conference presentations “ Preparing for a Pipeline Integrity Management Audit – Covering All the Bases”.

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