Due to the amount of interest in both the May and June DOT seminars (both were sold out), RCP is planning to repeat this two and a half day seminar on July 11-13 in Houston, Texas. Registrations will be accepted for each day independently, with group and multi-day discounts available. For more information on the seminar, please contact Bill Byrd at wrbyrd@your-rcp.com or phone 225-229-8080. To register please contact Marilyn at marilyn@your-rcp.com or phone 225-755-7760.

For more information, visit the seminar webpage at:

http://www.your-rcp.com/dotseminar2000.htm.

You can also download a seminar brochure in .pdf format by going to

http://www.your-rcp.com/downloads/misc/brochure.pdf

(Requires Adobe Acrobat)

On June 5, 2000, the EPA gave notice that on May 11, 2000, two proposed Consent Decrees ("Decrees") in the United States v. Natural Gas Processing Company and KCS Resources, Inc. d/b/a/ Mountain Resources, Inc., Civ. Action No. CV 00-65-RFC, were lodged with the United States District Court for the District of Montana, Great Falls Division. The United States filed this action pursuant to Section 1423(b) of the Safe Drinking Water Act ("SDWA"), 42 U.S.C. §300h-2(b), seeking injunctive relief and civil penalties for the Defendants' violation of various provisions of Part C of the SDWA and of 40 CFR part 144.

The proposed Consent Decree with the Natural Gas Processing Company ("NGP") requires NGP to pay a civil penalty of $54,000, including interest. The proposed Consent Decree with KCS Resources, Inc. d/b/a/ Mountain Resources, Inc. ("KCS") requires KCS to pay a civil penalty of $25,000, including interest, and to perform a Supplemental Environmental Project involving the plugging of one or more abandon Class II Underground Injection Control wells in Montana.

Acquiring a pipeline?

RCP can provide due diligence audits to help you ensure that potential compliance issues have been addressed before the sale is final.

The results of the pilot test to determine Unusually Sensitive Areas (USAs) have been posted on the Office of Pipeline Safety website at http://ops.dot.gov/pilotresults.htm. According to the pilot results, 15.87% of the State of California (including virtually the entire coastline) would be considered an "Unusually Sensitive Area" for ecological resources. This compares to 3.9% of the State of Louisiana, and 2.06% of the State of Texas. The discrepancy between states is rather significant. Also significant is the peer review comment submitted by the State of California, which stated that additional areas in the state should be included in the definition, and that other states should " be brought up to California’s standards in Natural Heritage data collection and automation rather than "dumbing down" our data so the application of the rule will be consistent."

The USA rule will be used in current and future regulations associated with spill response, low pressure pipelines, emergency flow restricting devices, increased pipeline inspection, risk management, and integrity management in high consequence areas. The first 10 states slated for USA identification completion are TX, OK, KS, LA, IL, WY, NM, CA, MO, and MT. These 10 states contain about 75% of the hazardous liquid pipelines in the United States. The DOT is targeting to have USA maps for these states by the end of 2000. The DOT plans to publish a final rule on USAs by 12/00.

On May 11, 2000, the Southern Gas Association (SGA) made the following press release, which could be of interest to any gas pipeline operator that is developing their operator qualification program: Over one hundred pipeline operators and federal and state regulators participated in a round table discussion during the SGA Operator Qualification Benchmarking Round Table, May 8-9, in Louisville, Kentucky.

The SGA, with support from AGA, NEGA, MEA, and APGA, conducted the "Operator Qualification Benchmarking Survey" earlier this year. One hundred and ten (110) pipeline operators submitted completed questionnaires which consisted of fifty-three questions. The final report provides a benchmarking tool for operators to compare themselves to their peers as they work toward compliance with the OQ rule.

The final report is available only to those companies that participated in this project and for a limited time, non-participating companies may receive a free copy of the report by submitting a completed questionnaire to SGA.

Participants in the round table first reviewed and compared the information collected in the "Pipeline Operator Survey" and the "Regulator Survey". Areas of disagreement and concern were identified and then discussed in separate breakout sessions for distribution, transmission, and regulators. All three groups came back together on day two to review and summarize the previous day's discussion.

Lively discussion was held on contractor issues; definitions; embarkation point between new construction and maintenance; covered tasks; evaluation methods and record keeping.

"Having the regulators attend this meeting allowed pipeline operators and professionals that will audit them the opportunity to discuss in a face to face forum, issues that remain unresolved," said Richard Sanders, Transportation Safety Institute. "We applaud industry for coming together through various regional and national associations and inviting us to the table to discuss these issues. We look forward to future forums that promote this type of healthy dialogue."

SGA, in partnership with other regional and national associations plan to host future meetings featuring this format. Additionally, an audio conference has been tentatively scheduled for August in conjunction with the next Pipeline Employee Performance Group meeting.

Know someone with regulatory expertise who is interested in full or part time work? Our recruiting coordinator would be glad to get their resume! Have them sent to marilyn@your-rcp.com, or FAX to 713-655-8083.

The pipeline safety act is up for reauthorization this year. The current draft versions of this legislation include the following types of changes versus prior legislation:

1. additional protections for critical areas, with an emphasis on increased internal inspections and testing and a focused attention on pipeline integrity.
2. enhanced public education programs and increased information available to community responders and planners. It would also include state emergency response commissions and local emergency planning committees established under the Emergency Planning and Community Right-To-Know Act within the mix of state and local authorities who interact with pipeline operators.
3. increased levels of maximum civil penalties for violations, and enhanced criminal enforcement.
4. additional support of underground damage prevention, with clarification to assure that prosecutions of excavators who knowingly and willfully disregard one-call notification requirements are successful.
5. enhanced state role in interstate pipeline safety, with increases in the allowable federal share of grants to states for inspections of interstate operators for states that perform these inspections for the DOT, such as monitoring construction and investigating incidents. This also allows full compensation to states performing special investigations for the Department.

On June 2, the U.S. Department of Transportation’s (DOT) Research and Special Programs Administration (RSPA) announced it is seeking the largest civil penalty ever proposed against a pipeline operator in the history of the federal pipeline safety program. The $3.05 million civil penalty is for safety violations related to the June 1999 pipeline failure in Bellingham, Washington, which resulted in the deaths of three young people. The full press release can be accessed at http://www.dot.gov/affairs/rspa1400.htm. Each of the penalties proposed carries the maximum fine allowed under current pipeline safety law.

Following are the safety violations cited and the proposed civil penalties against Olympic.

• Olympic failed to conduct adequate damage prevention efforts. Specifically, Olympic failed to ensure that a company representative was present during third-party excavation near its pipeline. Proposed fine: $25,000.
• Olympic employees discovered an unsafe condition during internal testing and continued to operate the pipeline after testing without correcting the problem. Proposed fine: $500,000.
• Olympic failed to ensure that the employees on duty at the time of the pipeline failure were trained in accordance with federal pipeline safety regulations. Proposed fine: $500,000.
• Olympic’s Supervisory Control and Data Acquisition (SCADA) system, the computer system the operator uses to control the pipeline, performed irregularly. Olympic took action to shut down the pipeline, then restarted the pipeline without ensuring that it could operate safely. Proposed fine: $25,000.
• Olympic failed to modify its operations, maintenance and emergency plans when it added a new facility, the Bayview Products Terminal. Proposed fine: $500,000.
• Olympic failed to adequately test relief valves at the Bayview Products Terminal (about 15 miles south of Bellingham) to ensure the safety and proper functioning of the valves. Proposed fine: $500,000.
• Valves at the Bayview Products Terminal shut down several times unintentionally, an event which indicates an abnormal situation. Olympic failed to respond to, investigate and correct those shutdowns. Proposed fine: $500,000.
• Olympic failed to maintain the required daily operating records that record the discharge pressure at each pump station and any abnormal events. Proposed fine: $500,000.

Pending Audits?