[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]
THE SAFETY OF HAZARDOUS
LIQUID PIPELINES: REGULATED VS. UNREGULATED PIPELINES
=======================================================================
(111-124)
HEARING
BEFORE THE
SUBCOMMITTEE ON
RAILROADS, PIPELINES, AND HAZARDOUS MATERIALS
OF THE
COMMITTEE ON
TRANSPORTATION AND INFRASTRUCTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED ELEVENTH CONGRESS
SECOND SESSION
__________
June 29, 2010
__________
Printed for the use of the
Committee on Transportation and Infrastructure
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COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE
JAMES L. OBERSTAR, Minnesota, Chairman
NICK J. RAHALL, II, West Virginia, JOHN L. MICA, Florida
Vice Chair DON YOUNG, Alaska
PETER A. DeFAZIO, Oregon THOMAS E. PETRI, Wisconsin
JERRY F. COSTELLO, Illinois HOWARD COBLE, North Carolina
ELEANOR HOLMES NORTON, District of JOHN J. DUNCAN, Jr., Tennessee
Columbia VERNON J. EHLERS, Michigan
JERROLD NADLER, New York FRANK A. LoBIONDO, New Jersey
CORRINE BROWN, Florida JERRY MORAN, Kansas
BOB FILNER, California GARY G. MILLER, California
EDDIE BERNICE JOHNSON, Texas HENRY E. BROWN, Jr., South
GENE TAYLOR, Mississippi Carolina
ELIJAH E. CUMMINGS, Maryland TIMOTHY V. JOHNSON, Illinois
LEONARD L. BOSWELL, Iowa TODD RUSSELL PLATTS, Pennsylvania
TIM HOLDEN, Pennsylvania SAM GRAVES, Missouri
BRIAN BAIRD, Washington BILL SHUSTER, Pennsylvania
RICK LARSEN, Washington JOHN BOOZMAN, Arkansas
MICHAEL E. CAPUANO, Massachusetts SHELLEY MOORE CAPITO, West
TIMOTHY H. BISHOP, New York Virginia
MICHAEL H. MICHAUD, Maine JIM GERLACH, Pennsylvania
RUSS CARNAHAN, Missouri MARIO DIAZ-BALART, Florida
GRACE F. NAPOLITANO, California CHARLES W. DENT, Pennsylvania
DANIEL LIPINSKI, Illinois CONNIE MACK, Florida
MAZIE K. HIRONO, Hawaii LYNN A WESTMORELAND, Georgia
JASON ALTMIRE, Pennsylvania JEAN SCHMIDT, Ohio
TIMOTHY J. WALZ, Minnesota CANDICE S. MILLER, Michigan
HEATH SHULER, North Carolina MARY FALLIN, Oklahoma
MICHAEL A. ARCURI, New York VERN BUCHANAN, Florida
HARRY E. MITCHELL, Arizona BRETT GUTHRIE, Kentucky
CHRISTOPHER P. CARNEY, Pennsylvania ANH ``JOSEPH'' CAO, Louisiana
JOHN J. HALL, New York AARON SCHOCK, Illinois
STEVE KAGEN, Wisconsin PETE OLSON, Texas
STEVE COHEN, Tennessee TOM GRAVES, Georgia
LAURA A. RICHARDSON, California
ALBIO SIRES, New Jersey
DONNA F. EDWARDS, Maryland
SOLOMON P. ORTIZ, Texas
PHIL HARE, Illinois
JOHN A. BOCCIERI, Ohio
MARK H. SCHAUER, Michigan
BETSY MARKEY, Colorado
MICHAEL E. McMAHON, New York
THOMAS S. P. PERRIELLO, Virginia
DINA TITUS, Nevada
HARRY TEAGUE, New Mexico
JOHN GARAMENDI, California
HANK JOHNSON, Georgia
SUBCOMMITTEE ON RAILROADS, PIPELINES, AND HAZARDOUS MATERIALS
CORRINE BROWN, Florida Chairwoman
DINA TITUS, Nevada BILL SHUSTER, Pennylvania
HARRY TEAGUE, New Mexico THOMAS E. PETRI, Wisconsin
NICK J. RAHALL II, West Virginia JERRY MORAN, Kansas
JERROLD NADLER, New York GARY G. MILLER, California
ELIJAH E. CUMMINGS, Maryland HENRY E. BROWN, Jr., South
GRACE F. NAPOLITANO, California Carolina
JASON ALTMIRE, Pennsylvania TIMOTHY V. JOHNSON, Illinois
TIMOTHY J. WALZ, Minnesota, Vice SAM GRAVES, Missouri
Chair JIM GERLACH, Pennsylvania
MICHAEL A. ARCURI, New York CHARLES W. DENT, Pennsylvania
CHRISTOPHER P. CARNEY, Pennsylvania LYNN A. WESTMORELND, Georgia
ALBIO SIRES, New Jersey JEAN SCHMIDT, Ohio
MARK H. SCHAUER, Michigan CANDICE S. MILLER, Michigan
BETSY MARKEY, Colorado VERN BUCHANAN, Florida
MICHAEL E. McMAHON, New York BRETT GUTHRIE, Kentucky
THOMAS S. P. PERRIELLO, Virginia AARON SCHOCK, Illinois
PETER A. DeFAZIO, Oregon ANH ``JOSEPH'' CAO, Louisiana
JERRY F. COSTELLO, Illinois PETE OLSON, Texas
BOB FILNER, California TOM GRAVES, Georgia
EDDIE BERNICE JOHNSON, Texas
LEONARD L. BOSWELL, Iowa
RICK LARSEN, Washington
MICHAEL H. MICHAUD, Maine
DANIEL LIPINSKI, Illinois
STEVE COHEN, Tennessee
LAURA A. RICHARDSON, California
JAMES L. OBERSTAR, Minnesota
(ex officio)
CONTENTS
Page
Summary of Subject Matter........................................ vi
TESTIMONY
Epstein, Lois N., P.E., LNE Engineering and Policy, Anchorage,
Alaska, and Consultant, Pipeline Safety Trust.................. 5
Falgoust, Stephen, Director, Asset Integrity, Plains All American
Pipeline LP, also on behalf of the Association of Oil Pipe
Lines and the American Petroleum Institute..................... 5
Hersman, Hon. Deborah A., Chair, National Transportation Safety
Board.......................................................... 5
Quarterman, Hon. Cynthia, Administrator, Pipeline and Hazardous
Materials Safety Administration................................ 5
PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS
Cohen, Hon. Steve, of Tennessee.................................. 30
Oberstar, Hon. James L., of Minnesota............................ 31
Richardson, Hon. Laura, of California............................ 35
PREPARED STATEMENTS SUBMITTED BY WITNESSES
Epstein, Lois N.................................................. 40
Falgoust, Stephen................................................ 51
Hersman, Hon. Deborah A.......................................... 56
Quarterman, Hon. Cynthia......................................... 64
SUBMISSIONS FOR THE RECORD
Quarterman, Hon. Cynthia, Administrator, Pipeline and Hazardous
Materials Safety Administration:
Response to request for information from Hon. Brown, a
Representative in Congress from the State of Florida..... 22
Response to request for information from Hon. Larsen, a
Representative in Congress from the State of Washington.. 18
Response to request for information from Hon. Sires, a
Representative in Congress from the State of New Jersey.. 12
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THE SAFETY OF HAZARDOUS LIQUID PIPELINES: REGULATED VS. UNREGULATED
----------
Tuesday, June 29, 2010
House of Representatives,
Subcommittee on Railroads, Pipelines, and Hazardous
Materials,
Committee on Transportation and Infrastructure,
Washington, DC.
The Subcommittee met, pursuant to call, at 2:00 p.m., in
room 2167, Rayburn House Office Building, Hon. Corrine Brown
[Chairman of the Subcommittee] presiding.
Ms. Brown. The Subcommittee on Railroad, Pipelines and
Hazardous Material will please come to order.
The Subcommittee is meeting today to hear testimony on the
safety of hazardous liquid pipeline. Today's hearing will focus
on which pipelines are regulated, which pipelines are exempt
from safety regulations, and any gaps that may exist in those
regulations.
With almost 200,000 miles of on-shore and off-shore
hazardous liquid pipelines in the United States, it is critical
that DOT ensure that all pipelines, regardless of their size
and location, are being operated in a safe manner.
A few things have become crystal clear as a result of the
Deepwater Horizon oil spill. One is that the industry cannot be
relied upon to regulate itself. It is up to Congress and the
Federal agencies to establish that high bar of safety that the
industries must meet and that our constituents expect and then
to enforce those safety standards.
Second, although the industry talks a lot about safety, it
is clear that the culture of safety is not there. This is
evident in their history of accidents, their lack of compliance
with existing regulations, and their disregard for worker
safety.
What we have also seen is an unhealthy, often cozy
relationship between the oil industry and the agencies that are
responsible for regulating them. We saw this when we conducted
our hazardous materials investigations with DOT, and we have
seen it in the past with other investigations of the DOT's
Office of Pipeline Safety.
And although pipeline releases have caused relative few
fatalities in absolute numbers, a single pipeline incident is a
catastrophe. For example, in 1999, a gas pipeline explosion
killed two children and an 18-year-old man and caused $45
million in property damage. In 2006, a corroded pipeline in the
North Slope of Alaska leaked more than 200,000 gallons of crude
oil in an environmentally sensitive area. And on May 25, 2010,
during a scheduled shutdown of the 800-mile Trans-Alaska
pipeline for maintenance, a relief tank overflowed and spilled
210,000 gallons of crude oil.
Even with the new low-stress regulations issued by PHMSA,
there are still gaps in regulating the safety of hazardous
liquid pipelines, and I don't believe we truly know if the
industry is prepared to react to an accident. That is why it is
critical that Congress ensures that PHMSA has all the tools it
needs to protect our community and environment from harm. It is
obvious that we have a lot of work to do to ensure that
pipelines in the United States are made as safe as possible and
that companies involved in the oil and gas industry are making
safety their number one priority.
With this, I want to welcome today's panelists and thank
them for joining us. I look forward to hearing their testimony.
Before I yield to Mr. Shuster, I ask that Members be given
14 days to revise and extend their remarks and to permit the
submission of additional statements and materials from Members
and witnesses.
Without objection, so ordered.
I yield to Mr. Shuster for his opening statement.
Mr. Shuster. I thank the Chairwoman and thank you for
holding this hearing today.
As the authorization for pipeline safety programs is set to
expire in September, it is important that we continue to hold
hearings like this to identify what parts of the law are
working and what parts need to be revisited.
I think the situation in the Gulf is certainly a
catastrophe, and BP needs to be held accountable. When I saw
the fact that BP has had over 700 willful violations of
drilling and pipeline safety out in the Gulf, and the next
closest violator is Sunoco with eight, there certainly is a
problem with what BP is doing, and we need to make sure that we
are safe in what we are doing out there in the Gulf.
We need to, obviously, first of all, stop the spill, stop
the oil from coming out into the Gulf; second, focus on the
cleanup; and then we will have plenty of time to assess the
blame and hold those accountable for the situation.
But as you hold these hearings on pipeline safety that is
not dealing with deep shore pipelines, it is dealing mainly,
almost exclusively, with pipelines that are on land or very
close to the land, it is important to remember that these
pipelines are the safest mode of transportation. In 2008, there
were 39,000 transportation-related fatalities. Only eight of
those deaths were attributed to pipeline accidents, and only
two were attributed to liquid pipeline accidents.
Certainly the loss of life, we don't like to see any of
that, but it is very low. It is very safe. And my view would be
the only way to stop it, have zero fatalities, is to not ship
anything. Because when you have even a low amount of risk, you
are going to have accidents, and we want to make sure that they
are held to very much a minimum, which it appears that they
are.
Pipelines are also the most efficient and environmentally
sound way to transport petroleum liquids. Liquid pipelines
transport more than 17 percent of our Nation's freight but only
account for 2 percent of our Nation's freight bill. In
addition, for every barrel of oil shipped 1,000 miles by
pipeline, less than one teaspoon of a barrel is lost.
But just because liquid pipelines are efficient and have a
solid safety record does not mean there is nothing left to do.
Earlier this month, an estimated 800 barrels of oil escaped
from a leak in the Chevron crude oil pipeline near Salt Lake
City. Incidents like this have steadily declined over the past
10 years, but we need to ensure that the pipeline industry and
our pipeline safety regulators continue to work together so
that this downward trend in pipeline incidents continues over
the next 10 years.
Today, we will be hearing testimony on types of liquid
pipelines regulated by the Department of Transportation and the
types of liquid pipelines that are regulated by State agencies
or other Federal agencies. It is important to remember that
just because a pipeline is not regulated by the Department of
Transportation does not mean that the pipeline is not subject
to any regulation. State regulators and other Federal agencies,
such as the Coast Guard, the EPA, and OSHA, have the ability to
regulate certain pipelines.
I know that some of the witnesses feel there are gaps in
the regulation of liquid pipelines that must be closed. Others
believe that DOT has broad enough regulatory authority to
address any gaps that may exist. So I look forward to hearing
our witnesses today. Thank you all for being here. I appreciate
you taking the time.
And I yield back.
Ms. Brown. Mr. Sires from New Jersey.
Mr. Sires. Thank you, Chairwoman Brown and Ranking Member,
for holding this hearing. I will be very brief.
Basically, I represent the part of New Jersey, northern
part of New Jersey, the Jersey City area, Hoboken area; And
near that area 16 years ado we had the rupture of the Edison
pipeline. When it was all over, the plume was 400 feet high;
and it burned something like 1,500 apartments in the area.
My concern is that, as more and more development takes
place in those areas, the pipelines are running right under
some of the most heavily urban areas in the country. We have a
pipeline that is running through Jersey City and under the
Hudson River to bring gas to New York. One of the concerns that
I have is that sometimes even the municipalities do not have a
hearing concerning these pipelines, although this particular
pipeline that is running through Jersey City now held public
hearings, to their credit, and informed the public of what is
happening. I am very concerned about the safety of people that
live near these pipes, especially with the experience that we
had in New Jersey and Edison. They are running closer and
closer to urban areas, and I am very concerned about the
safety.
And now the rest of the remarks, Madam Chair, I would like
to submit for the record.
Ms. Brown. Thank you.
The congresswoman, Grace Napolitano from California.
Mrs. Napolitano. Thank you, Madam Chair; and thank you for
holding this really important issue to me and my district.
There are two major pipeline issues in my area that are
currently affecting the 30th Congressional. First is the
pipeline safety project under a railroad track which several
cities in the district have worked together to close two
railroad grade crossings that are not only a nuisance but also
creates a railroad diversion for Union Pacific through Cal Poly
Pomona University's agricultural fields in order to accomplish
it. However, this project has $80 million of taxpayer money, 99
percent complete, but not finished because of a little debate
between Kinder Morgan and Union Pacific.
The issue is how to protect the pipeline, which has been
greatly delayed and is costing some of my project people
$70,000, $80,000 just because of that delay. The California
State Fire Marshal has stepped in and directed the Pipeline and
Hazardous Material Safety Administration to visit, which they
have done, and to spur them into action. There is an issue
about what guidelines do they use. Do they use the Federal
guidelines or the State guidelines?
I will put these questions when my time comes up for
questions.
The second one is, Kinder Morgan is another pipeline in my
district which has leaked jet fuel over the last 30, 40 years
into an area that is highly populated. It is a plume that has
been cleaned up by the Air Force, who is the owner of the
property, and is spreading on to park and homes. The California
Regional Water Quality Control Board has been given the
authority by U.S. EPA to be the lead investigator and be the
regulator and has conducted tests. But these pipelines--it may
not be just my area, we have been dealing with it now for at
least 25 years that I can think of--is what is happening in
other areas where there is underground piping of fuels that are
supposedly monitored, supposedly tested on a regular basis--and
the Ranking Member says a teaspoon of oil, this is a whole leak
where it has contaminated a small body of water and, according
to some of the residents in the area, has other health effects
such as cancer.
So we need to be ensuring that these old systems, the aging
infrastructure, is looked at more thoroughly in areas where
there may be residential people or bodies of water underneath
that might be tainted and would produce some health effects for
the people that eventually get that water.
Thank you, Madam Chairman. I look forward to the questions.
Ms. Brown. Thank you.
Congressman Walz from Minnesota.
Mr. Walz. I thank you, Madam Chair; and I want to thank our
witnesses for being here. I would like to ask for consent to
submit a statement for the record, and I will yield the time to
the witnesses.
Ms. Brown. I am pleased to introduce our panel of
witnesses. We tried to schedule this hearing for an earlier
time, but the room wasn't available. So, due to the time
constraints, I am going to put all of the witnesses on the same
panel for this hearing.
We are pleased to have with us The Honorable Cynthia
Quarterman, who is the Administrator of Pipelines and Hazardous
Materials; Mrs. Deborah Hersman, Chair of the National
Transportation Safety Board; Mr. Stephen Falgoust, Director of
Asset Integrity, Plains All American Pipeline, also on behalf
of the Association of Oil Pipe Lines and the American Petroleum
Industry; and Mrs. Lois Epstein, P.E., Consultant, Pipeline
Safety Trust.
With that, Honorable Quarterman, you have the floor.
TESTIMONY OF THE HONORABLE CYNTHIA QUARTERMAN, ADMINISTRATOR,
PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION; THE
HONORABLE DEBORAH A. HERSMAN, CHAIR, NATIONAL TRANSPORTATION
SAFETY BOARD; STEPHEN FALGOUST, DIRECTOR, ASSET INTEGRITY,
PLAINS ALL AMERICAN PIPELINE LP, ALSO ON BEHALF OF ASSOCIATION
OF OIL PIPE LINES AND THE AMERICAN PETROLEUM INSTITUTE; AND
LOIS N. EPSTEIN, P.E., LNE ENGINEERING AND POLICY, ANCHORAGE,
ALASKA, AND CONSULTANT, PIPELINE SAFETY TRUST
Ms. Quarterman. Good afternoon, and thank you.
Chairwoman Brown, Ranking Member Shuster, Members of the
Subcommittee, thank you for the opportunity to appear here
today and for your continued interest in pipeline safety. We
very much appreciate it. Safety is our number one priority at
PHMSA and one that we share with Secretary LaHood and the rest
of the Department. I want to thank the Chairwoman for her
leadership and the attention given to this issue by the
Subcommittee.
Examining the regulatory framework and the oversight of the
Nation's hazardous liquid pipeline system is important in light
of changing industry practices and new technologies. Our
discussions today will identify current and needed protections
for public safety related to hazardous liquid pipelines.
For years, PHMSA has worked to utilize the authority given
to it by Congress to enhance the safety of hazardous liquid
pipelines. PHMSA's oversight of America's pipeline
transportation is broad and covers the vast majority of
pipelines located within our borders. Unfortunately, this
oversight is not unlimited, and PHMSA can only provide
protections from pipelines under our jurisdiction.
PHMSA has used responsible and methodical approaches to
focus on high-risk infrastructure issues first and provide
effective solutions through enforcement and rulemakings. This
tiered approach has helped PHMSA devise and implement effective
rulemakings, like the one in place and the one proposed for
low-stress lines.
For hazardous liquid pipelines, PHMSA's jurisdiction
includes the movement of highly volatile or other hazardous
liquids through pipelines meeting certain specifications,
including those crossing commercially navigable waters.
However, PHMSA does not have complete authority to regulate
certain gathering lines, a safety concern we share with the
National Transportation Safety Board.
PHMSA is in the process of developing legislation that
would address our jurisdiction over the transportation of
hazardous liquids by pipeline in the future. We would like to
collect more fulsome data related to the safety of hazardous
liquid pipelines and study the regulation of the transportation
of nonpetroleum hazardous pipelines, such as biofuels and
chlorine by-pipeline.
Finally, we are reviewing all instances where PHMSA has not
historically exercised its jurisdiction to determine whether
those exceptions still make sense or should be revoked.
The support of Congress is critical to the safe and
effective regulation of the transportation of hazardous liquid
pipelines. PHMSA looks forward to working with Congress to
address any issues you may have concerning its pipeline safety
program and the regulation of hazardous liquid pipelines. We
very much appreciate the opportunity to report on our authority
over hazardous liquid pipelines and the opportunities that
exist to strengthen our oversight.
Thank you, and I would be happy to answer any questions you
might have.
Ms. Hersman. Chairwoman Brown, Ranking Member Shuster, and
Members of the Committee, thank you for the opportunity to
discuss the issue of pipeline safety.
The NTSB is responsible for determining the probable cause
of transportation accidents and promoting transportation
safety. The Board now has 18 open recommendations to PHMSA
regarding the gas and liquid pipeline industry.
Today, I am going to focus on two concerns in my oral
testimony. One of those concerns gained much attention
following corrosion failures on a BP exploration low-stress
pipeline in 2006. While this leak in Alaska resulted in
improved regulations for low-stress pipelines, the Board
believes that more can be done.
This slide shows the complex system of low-stress and
gathering lines regulations prior to the BP incident, then to
the phase one PHMSA role and the proposed phase PHMSA role.
Last week, PHMSA released phase two, which proposes to extend
regulations to additional low-stress pipelines and use risk-
based monitoring as a means to conduct oversight. The NTSB
believes that a risk-based approach can work if effective
oversight is exercised by PHMSA and the pipeline operators.
This rulemaking does not address offshore pipelines or on- or
off-shore gathering lines.
As mentioned previously, an area of concern is risk-based
pipeline safety programs which require that the operators
develop, implement, and evaluate individual programs and plans.
PHMSA has the responsibility to review these plans for
regulatory compliance and to conduct audits to evaluate their
effectiveness. However, in recent investigations, the NTSB has
seen indications that PHMSA and the operator oversight has not
been adequate.
This photo is from a November 1, 2007, rupture of a propane
pipeline in Carmichael, Mississippi, that resulted in two
fatalities, seven injuries, and over $300 million in damage. It
is the responsibility of the pipeline operator to raise public
awareness about the pipeline. The operator hired two
contractors to administer its program, but the mailing list did
not include all residential addresses within the mailing area.
This mistake was not caught until after the accident. The NTSB
recommended that PHMSA initiate a review of all public
education programs.
Likewise, consideration of leak history is an important
factor in determining an operator's integrity management plan.
But in a 2004 anhydrous ammonia pipeline rupture in Kingman,
Kansas, we discovered that the operator left out the factor
assessing leak history. PHMSA did not catch the omission, and
it resulted in a deferred inspection. The pipeline ruptured 2
years before it was scheduled to be inspected.
As a result of these accidents and other investigations,
the NTSB believes that PHMSA must establish a more aggressive
oversight framework so that risk-based integrity management
programs are not only effectively designed but effectively
executed as well.
Thank you very much.
Mr. Falgoust. Thank you, Chairwoman Brown, Ranking Member
Shuster, and Members of the Subcommittee. I am Stephen Falgoust
of Plains All American Pipeline, representing the Association
of Oil Pipelines and the American Petroleum Institute. We
appreciate the opportunity to participate in this hearing.
I am Director of Asset Integrity for Plains, and I have
over 20 years experience in pipelines for petroleum
transportation. My experience is in regulatory compliance and,
to a greater extent, asset integrity.
Plains is a publicly traded master limited partnership
engaged in the transportation, storage, terminal ling, and
marketing of crude oil, refined products and liquefied
petroleum gas and other natural gas-related products. Plains
operates 12,000 miles of pipeline to the United States.
I am pleased to provide an overview of key components of
hazardous liquid pipeline safety regulations. A mix of Federal
and State oversight ensures the safety of our Nation's
hazardous liquid pipelines. I will first discuss the primary
Federal safety regulator in the Office of Pipeline Safety and
then discuss other regulatory oversight of pipeline safety.
OPS's liquid pipeline safety regulations cover the vast
majority of pipelines engaged in transportation of crude oil,
petroleum products, and other hazardous liquids. OPS is charged
with inspection and enforcement of pipeline safety regulations
over interstate pipelines and intrastate pipeline
transportation. In many instances, individual States also
enforce stringent pipeline safety regulations over intrastate
pipeline transportation within their boundaries. Lines not
subject to OPS's liquid pipeline safety regulations fall within
the purview of State agencies, such as State oil and gas
commissions and other State and Federal agencies.
Pipeline facilities involved in the transportation of
liquids or carbon dioxide in or affecting interstate or foreign
commerce, including pipeline facilities on the Outer
Continental Shelf, are covered by 49 CFR 195 and regulated by
OPS. All pipelines subject to Part 195 must meet numerous
requirements, including corrosion control, damage prevention,
public awareness, reporting, design standards, construction
methods, operational controls and limitations, pressure
testing, maintenance standards, qualification of personnel, and
emergency response. OPS's safety regulations also apply to
related pipeline facilities such as breakout tanks, valves,
meters, pumping units, pressure regulating devices, and other
equipment.
In addition to all of the other provisions of Part 195,
operators of pipelines that could affect high-consequence
areas, or HCAs, are required to develop an integrity management
plan. Pipelines are to perform integrity assessments of the
condition of their pipelines regularly and mitigate features
that could reduce pipeline integrity detected by those
assessments. This is an extra layer of oversight based on the
fact that consequences of a release are potentially greater if
there is an impact on such areas.
Certain liquid pipelines are regulated by State agencies
and Federal agencies other than OPS. For example, pipelines
that serve oil and gas production facilities within a local
producing area or that traverse between production facilities
may be regulated by States, except when they cross Federal
land, in which case they are regulated by Federal agencies.
These include pipelines sometimes referred to as flow lines or
production lines.
In addition, lines that gather crude oil from producing
areas and deliver it into a transportation pipeline may be
regulated by States or by other Federal land management
agencies. They are regulated by OPS if they cross non-rural or
are covered by the OPS low-stress pipeline rule.
The U.S. Coast Guard has safety oversight of pipelines that
serve as offshore facilities, marine facilities, and terminals.
Pipelines that operate on the OPS upstream, generally seaward,
of the last valve on the last production facility, and those
operated by producers that cross into State waters without
first connecting to a transportation operator's facility on the
OCS, are subject to the oversight of the Mineral Management
Service.
Intrastate pipelines are subject to OPS jurisdiction,
unless a State agency is federally certified to regulate and
inspect intrastate pipelines. Federal law specifically allows
States to assume responsibility for enforcing regulations over
intrastate pipelines through an annual certification. States
may have additional or more stringent requirements in place as
long as they are not inconsistent with Federal standards.
If a State does not meet the requirements for
certification, it can still enter into an agreement with OPS to
oversee certain aspects of intrastate pipeline safety, but OPS
retains responsibility of enforcement for any violations on
intrastate pipelines.
States also enforce State damage prevention laws. In 2006,
Congress granted OPS limited authority to enforce Federal
damage prevention laws in States which did not have adequate
State damage prevention programs.
Unfortunately, not every State plan is adequate and
adequately enforced. As our association witness mentioned on
May 20, we recommend OPS move forward with its proposal on
damage prevention and include a minimum requirement that State
programs must disallow one-call exemptions for State agencies,
municipalities, and commercial excavators. Third-party damage
is a leading cause of significant incidents along the right of
way, and we ask for your continued help in reducing those
risks.
Thank you.
Ms. Brown. Ms. Epstein.
Ms. Epstein. Good afternoon and thank you for inviting me
to testify today.
My name is Lois Epstein, and I am an Alaska- and Maryland-
licensed engineer. My background in pipeline safety includes
membership for 12 years on PHMSA's Hazardous Liquids Advisory
Committee, testifying before Congress many times on pipeline
safety, and analyzing the performance of Alaska's Cooke Inlet
pipeline infrastructure.
Currently, I am a consultant for the Pipeline Safety Trust,
a public interest non-profit located in Bellingham, Washington.
My testimony today reflects the Trust's views.
PHMSA regulation of pipelines has progressed greatly in the
past decade largely as a result of the work of Chairman
Oberstar and this Committee as well as other Committees which
provided vigorous oversight and statutory direction in the wake
of several tragic accidents. Of particular significance were
the 1999 Bellingham gasoline pipeline accident that killed
three youths, the 2000 Carlsbad natural gas pipeline accident
which killed 12, and the costly 2006 BP Pipeline releases on
Alaska's North Slope. The first two accidents resulted in
PHMSA's integrity management requirements. The Alaska releases
resulted in PHMSA finally proposing last week the second and
final phase of a congressional mandate issued in 2006 dealing
with unregulated rural low-stress pipelines. This mandate
followed a 1988 resolution--that was 22 years ago--by the
National Association of Pipeline Safety Representatives sent to
U.S. DOT asking for elimination of that exemption.
What is problematic about PHMSA's history and ominous for
the future is the reactive nature of its actions and the at-
times overly-narrow and inconsistent nature of its regulations.
PHMSA does not act proactively in preventing major pipeline
problems, a circumstance not unlike the now familiar situation
with the Minerals Management Service.
In the rest of my testimony, I discuss pipelines that PHMSA
needs to regulate to prevent future accidents proactively,
using some examples from Alaska that I am familiar with.
However, the problems with these types of pipelines occur
elsewhere as well. Regulating some of these types of pipelines
requires statutory changes, and others can be addressed
administratively.
As we have heard today from PHMSA, its pipeline regulation
can be described as patchwork at best. Near the end of my
testimony I discuss two long-standing, important deficiencies
in PHMSA's transmission line regulation. Please refer to figure
one showing what pipelines are regulated by PHMSA and which are
not and also the Alaska scheme for regulating those pipelines.
Both Congress and PHMSA are responsible for PHMSA's
extremely limited regulation of so-called ``gathering lines.''
Since 2006, the State of Alaska does not use this term at all
for pipelines that are not facility piping. They are now
regulated as flow lines or transmission pipelines.
It is not clear where federally defined gathering lines end
and transmission line begin. Given these two types of pipeline
similarities, one would think that PHMSA has sufficient
technical justification to regulate these similar lines in a
similar fashion. The Trust believes that Congress should
require PHMSA to regulate gathering lines as transmission lines
to prevent releases. NTSB's testimony before the Senate
Commerce Committee on June 24, 2010 supports this position.
Flow lines are multi-phased pipelines that take materials
from wells to separation facilitates. Particularly in the early
part of winter, Alaska commonly has releases from these
unregulated pipelines.
State regulation of these pipelines alone has not stopped
these spills, largely due, I believe, to the lack of
enforcement. On November 29, 2009, for example, BP had a
release of approximately 46,000 gallons from an 18-inch flow
line. Congress needs to require PHMSA to regulate flow lines
under 49 CFR 195 rules by a date certain.
Following separation of oil, gas, and water during crude
oil production, produced water lines carry briny water
contaminated with oil to injection wells for disposal. Produced
water may be considered hazardous liquid. These produced water
lines can and do fail in manners similar to other pipelines.
For example, on Christmas day in 2008, at the ConocoPhillips
Kuparuk oil field on Alaska's North Slope, a corroded pipeline
released nearly 100,000 gallons of toxic produced water.
Drilling for natural gas in shale and coal formations has
grown enormously in recent years and results in large
quantities of produced water. These pipelines carry toxic
materials to wells or surface disposal facilities, including
evaporation ponds. Congress needs to required PHMSA to regulate
produced water lines under 49 CFR 195 by a date certain.
On the topic of regulatory deficiencies for currently
regulated pipelines, in its hazardous liquid pipeline integrity
management rule PHMSA rejected the comments of NTSB, U.S. EPA,
and others and chose to leave shutoff valve location decisions
up to pipeline operators. Congress needs to reiterate its
previous mandates to PHMSA on shut off valve use and ensure
they are followed.
Similarly, there are no performance standards for leak
detection systems. The Chevron pipeline release near Salt Lake
City earlier this month is an example of what can go wrong when
a pipeline with a leak detection system has no performance
standards for that system, and I included an attachment on that
leak. Congress also needs to direct PHMSA to issue performance
standards for leak detection systems by a date certain.
In conclusion, hazardous liquid pipeline releases can have
serious adverse public environmental and economic consequences.
These consequences can nearly be eliminated and certainly can
be significantly reduced with adequate Federal pipeline safety
requirements and adequate enforcement, but that is a topic for
another day. Investing in pipeline safety as a Nation pays off
over the long term. Thank you very much for your attention to
these important issues.
Ms. Brown. Thank you all for your testimony.
Now Mr. Sires.
Mr. Sires. Thank you, Madam Chairman.
Ms. Quarterman, I understand that special permits may be
requested in certain instances by an operator that can waive
and modify compliance with an existing regulation. While I
understand that PHMSA must ultimately approve this request, to
me this still appears that the industry is given the
opportunity to regulate itself. Do you know how many special
permits are approved and do you know what percentage of special
permits are approved that are submitted?
Ms. Quarterman. I believe there are about 85 special
permits that exist in the pipeline program.
With respect to special permits, there is a requirement
that those permits equal or better the regulatory requirements
in the rule. There is a detailed process that takes sometimes
as much as 2 years before a special permit has been approved.
It includes involvement of subject matter experts. Our
engineering group, all of the regional directors for the
program have to all agree that it is appropriate to have a
special permit.
As to the numbers that have been rejected, I don't know
that. Across the board, I think, in the past year about 22 out
of--about one-third I think were not approved, but I can get
those statistics to you for the record.
[The information follows:]
[GRAPHIC] [TIFF OMITTED] T7251.011
Mr. Sires. So two-thirds were approved.
I don't understand why, if it takes 2 years, why do they
have to file for a waiver, these operators?
Ms. Quarterman. Well, if they don't file for a waiver, they
have to follow the pipeline safety requirements.
Mr. Sires. And how long does that take?
Ms. Quarterman. Well, that is the existing rules, which is
straightforward. They can do that immediately.
Mr. Sires. The other question that I had is, in terms of
municipalities, how do you inform the municipality that this is
taking place? Because I understand there are no requirements
for a municipality to give the approval for these pipes.
Ms. Quarterman. With respect to hazardous liquid pipelines,
there is no Federal agency that is responsible for siting
unless those pipelines cross the international borders, in
which case the Department of State becomes involved in terms of
siting. PHMSA is not involved in siting decisions for any
pipelines.
Mr. Sires. In other words, if I have a municipality, that
pipe is coming through my municipality, that municipality does
not have to give approval in order for that pipe to go through.
Ms. Quarterman. Well, in order to put a pipeline through a
State or municipality, a pipeline owner has to obtain the right
of way. So there can be involvement, usually at a State,
perhaps at the municipal level, in terms of determining whether
those State or municipal standards are met.
Mr. Sires. And the other thing I am concerned about is,
when you have one of these accidents, usually the first people
that respond is the fire department. How quickly do you inform
those fire departments of the kind of chemicals that may be
going through a pipeline?
Ms. Quarterman. Immediately. Usually, the fire department
knows before we do because they are closest to an incident. But
there is a national incident system whereby we are notified;
and we immediately notify, if it is in a State, the State
officials who are involved. The NTSB is also often notified of
those instances. Of course, the emergency responders.
Mr. Sires. So you tell them exactly what is in that
pipeline?
Because one of the things that happened in my district was
there was an accident with a railroad car, and the chemical was
spilled, but the mayor of the town was afraid to send in the
firemen because he said that it was not proper for the firemen.
He was afraid for the firemen.
Ms. Quarterman. In the hazardous material program--and I
think this probably applies to the hazardous material portion
of our responsibility--we do fund I think it is $28 million in
hazardous materials emergency response grants to States to
assist them in preparing for an instance where there is a
hazardous material spill.
As a part of that program, we also have an emergency
response guidebook, which is a little guidebook that almost
every fireman carries with him on his fire engine and in police
cars so that if they notice a hazardous spill they can look
through it and immediately know whether they should get close
to it or not based on the information that is contained there.
Mr. Sires. Thank you very much, Madam Chairman.
Ms. Brown. In response to your question, that is one of the
purposes that we are having a hearing, to find out whether or
not the rule is adequate, whether we need to change the law,
and what is the procedures in place for waiving the rules. So
that was a very timely question.
Mrs. Napolitano.
Mrs. Napolitano. Thank you, Madam Chairman.
The question is for Ms. Quarterman. You've heard me in my
opening statement refer to the issue with Union Pacific and
Kinder Morgan on a pipeline and its corresponding bend.
Apparently, there is a bend that they have to deal with. Their
disagreement has delayed this project for a number of years,
and your administration had the State fire marshal inspect it.
The issue is, the pipeline company wants to use DOT load
standards, and the railroad wants to use the American Railroad
Maintenance Waste Standards in protecting that pipeline, that
bend. What is the difference and why would there be such an
issue--to me, it sounds like Union Pacific wants to move the
whole pipeline. Well, that can't happen. It is very expensive,
in the millions of dollars--or more than that.
UP claims that the pipeline must be protected and continues
steel encasement of that bended pipe. Kinder Morgan says many
of the safety regulators, including the State regulators,
contend that continuous steel encasement is dangerous and leads
to corrosion and electrical shorts in the pipe.
Now this can happen at any other place. It isn't just my
area. But I am looking for clarification. Is this safe or not?
And the pipeline company wants a full concrete cap. UP
says. No, we want it moved or we want to do this particular
kind of encasement. And yet there are questions about the
safety of that steel encasement creating a short.
Do disagreements between pipeline companies and the
railroad happen often? How are they resolved? Do we have any
way of being able to sit these two--I have already sat them
down, had them meet, and they are still arguing over which is
better or what should be done on it. And how can your
administration help States oversee and regulate pipelines
safety? Certainly we want to ensure that this is the best
protection, but if both the State and the Federal agree and yet
Union Pacific does not.
Ms. Quarterman. I thank you for your question.
I am sure that this happens--maybe not frequently, but
occasionally. In this instance, I believe that our staff has
been trying to work to help resolve the issue there. The
primary issue is that it appears that UP is the landowner and
has that right of way, and they are requiring certain standards
for the crossing underneath their facility.
Mrs. Napolitano. Well, that is questionable, ma'am. Because
the land was Cal Poly Pomona University, and there was
supposedly an agreement to be able to transfer some land in
exchange for being able to allow that to happen on their land.
I can check it out further, but go ahead, please.
Ms. Quarterman. I don't know the specifics of that, but
just under the assumption that was the end----
As to the safety standard, I can tell you that the reason
that the pipeline that PHMSA and the State have a view about
the casing is in fact what you stated, is a question of
corrosion. When you have encased pipeline, you have one metal
within another metal, there is the opportunity for corrosion to
be increased and to have corrosion-related events. It may be
that the railroad is thinking about weight limitations, and I
am not sure--maybe they just have the notion of having two
pipes is better than one. I am not exactly sure what their
rationale is there, but we would be happy to continue to work
with you and try to reach resolution on that.
Mrs. Napolitano. I would really appreciate it.
But, also, you might want to look at it from the standpoint
of some other areas having the same issue of having a costlier
resolution to an issue that doesn't really need that higher
standard. Because if both the Federal and the State are
agreeing and the railroad is not, something is wrong.
Ms. Quarterman. Right.
Mrs. Napolitano. Thank you, Madam Chair.
Mr. Walz. [presiding.] Mr. Shuster is recognized for 5
minutes.
Mr. Shuster. My question, Chairman Hersman--first
question--in the Kansas pipeline failure, I believe you said it
was a failure on the part of PHMSA not going through the
process properly; is that accurate?
Ms. Hersman. Yes, sir. There were actually a couple of
failures. The first failure was that the company needed to take
a number of factors into consideration when they are assessing
the risk for the pipeline. One of those is leak history, and
that would maybe bump it up for an inspection on a faster
interval. They did not include that in their assessment, and
PHMSA failed to catch that they omitted that particular factor.
Mr. Shuster. It wasn't that the regulatory regime that was
in place was not adequate. It was that the bureaucracy didn't
go through the process. Is that a proper characterization?
Ms. Hersman. The requirements were there. They were not
followed.
Mr. Shuster. And that is what concerns me, that you are
proposing these low-stress pipelines and some of these--the
gathering pipelines and the NPRM phase twos are not under DOT
regulation. But isn't it true that there is a State--in many
cases, in some cases, in all cases--are overseeing the
regulatory requirements on these pipelines?
Ms. Hersman. I think the primary concern that the Safety
Board has is that there is a bit of a patchwork system, that it
is not consistent regulations to all of these different types
of pipelines. There was actually a gathering line event in
Garoset, Texas, last month that involved a fatality, and it is
being investigated by the Texas Railroad Authority. But it was
a gathering line incident.
So I think the concern that the Safety Board has is whether
there are risks to human beings or the environment. The
diameter of the pipeline is not necessarily the controlling
factor or the pressure in the pipeline isn't necessarily the
controlling factor. We saw a large release on BP property in
2009 that was a six-inch line.
Mr. Shuster. And when the NTSB makes these recommendations,
you put them under a cost-benefit analysis to try to understand
what the cost is going to be, what the benefit is we are going
to gain?
Ms. Hersman. Part of our charge from Congress is actually
not to do that. So we investigate accidents and we make
recommendations on what we think is best in the safety
interests. It is up to the regulator and other entities to do
the cost benefit.
Mr. Shuster. And I understand that is your charter, and
Congress chartered you to do that. But sometimes when we put
these regulatory recommendations out there, at some point, as
you said, the agency has to do a cost-benefit analysis because
it--I don't want to see an accident. I don't want to see one
life lost. But the reality is as long as there are human beings
doing these types of things--driving cars, flying planes--there
is going to be human error. There is going to be mechanical
failure.
So it becomes a concern of mine when we are looking at an
industry that is very safe by all accounts to put forth new
recommendations like this without an agency doing a cost-
benefit analysis. Maybe at some point we need to relook at the
NTSB's charter and at some point look at those types of cost-
benefit analyses.
Ms. Quarterman, does the administration plan on developing
a pipeline safety reauthorization bill?
Ms. Quarterman. We are working on a bill, yes.
Mr. Shuster. And, in your view, would you characterize the
industry as being very safe?
Ms. Quarterman. I think the pipeline safety record over the
past 20 years has improved markedly. There is always room for
further improvement. Certainly, as compared to some of the
other modes of transportation, it is safer.
Mr. Shuster. And as we move forward, I certainly would like
to work with you on this. Because, as I said, I think there has
been some shortcomings over the years at PHMSA; and I think
some of that, if not all of that, has to do with a lack of
staffing and maybe the process not being in place that needs to
be there.
But, again, to put a whole new layer of regulations on an
industry that, as I have said and some of the testimony here
today, and I think if you go across the country, it is very
safe. And we need to build upon that but not, again, put a
whole new layer of regulatory burden on it that, in the end, I
don't believe is going to make it that much, if any, safer than
it is today.
I see my time is ready to expire, so I yield back.
Mr. Walz. Thank you, Mr. Shuster.
Mr. Larsen, you are recognized for 5 minutes.
Mr. Larsen. Ms. Epstein, you recommend fully regulating
gathering lines and produced water lines. Some say that because
various lines are regulated by a State or by a Federal
authority or State or Federal agencies there is no need for
additional Federal regulation of those lines. Can you respond
to that?
Ms. Epstein. Sure. And there was a reason, in addition to
my having ready access to Alaska data, that I use Alaska as an
example. Because we do, in fact, have good, comprehensive
regulations of flow lines, produced water lines, and gathering
lines in the State. However, we don't do enough enforcement in
Alaska.
I think some of that is similar to the situation that is
now well-known with the Minerals Management Service, where
there is a conflict of interest in the sense that the State
gets revenue from leases and having wells produce oil and
sending it through the Trans-Alaska Pipeline. So, therefore,
you have a situation where the State is conflicted in terms of
how it approaches enforcement. But those were very major
examples of 46,000 gallons released in one case, 100,000 in
another.
And with due respect to Congressman Shuster, part of the
mandate of PHMSA is to approach pipeline safety in terms of
safety and environmental protection; and these pipelines have
been unregulated by PHMSA to date. I would argue the produced
water lines, they have the existing authority to go forward
with regulating those lines, but in terms of the other lines,
we would need some help from Congress to ensure that those are
covered.
Mr. Larsen. Ms. Quarterman, Washington State has an
agreement with PHMSA. We have our own pipeline safety agency.
How many States have requested and received agreement to share
certain responsibilities with PHMSA?
Ms. Quarterman. On the hazardous liquid side or more
generally?
Mr. Larsen. On hazardous liquid.
Ms. Quarterman. On hazardous liquid, I believe there are
about 14 States that have an intrastate agreement. Another two
have--well, 15 have a certification, two have an agreement, and
another six serve as interstate agencies on behalf of PHMSA.
Mr. Larsen. And perhaps you don't have the number now, how
many inspectors do those States have with authority?
Ms. Quarterman. I don't have the number.
Mr. Larsen. Can you get that?
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[GRAPHIC] [TIFF OMITTED] T7251.012
Mr. Larsen. And then can you compare that to the number of
enforcement inspectors that you have?
Ms. Quarterman. Well, I can tell you how many we have. We
have authorization for 135. In the President's budget for
fiscal year '10, we have 136 positions. Right now, we have 102
people onboard in the inspection and enforcement area. There
are 18 people who we are in the process of interviewing. There
are another 10 people that we have essentially--it is out on
the street. An advertisement is on the street. And I think
there are another six people who we have made an offer to and
hope to start soon.
Mr. Larsen. Ms. Hersman, I didn't see it in your testimony,
and perhaps I missed it--and perhaps NTSB doesn't have a
position--the idea of PHMSA being responsible for regulating
the entire pipeline. When we put this together in 2002 and in
2006, we really did look at the high-consequence areas, places
where people live, places where people played, and that kind of
thing, as opposed to bringing a certain level of regulation to
the entire length of a pipeline. Does NTSB have a position on
that?
Ms. Hersman. The NTSB supports expanding integrity
management to the entire system.
One of the biggest concerns that we have is when operators
fail to identify a high-consequence area correctly. We are
investigating a gas accident in Florida where a segment of
pipeline ruptured right close to the Florida turnpike, and it
was not accurately designated as a high-consequence area in the
pipeline's plans.
Mr. Larsen. Mr. Falgoust, in the short time I have left, if
you can just answer the question: How would you all then see
that, expanding the integrity management planning to the length
of a pipeline?
Mr. Falgoust. Well, OPS, guided by Congress, focuses its
regulatory efforts on pipelines that pose the greatest risk to
the environment and to the people. Pipelines have every
incentive to ensure integrity. There are a lot of millions of
dollars that are spent on integrity management. And due to
failure analysis, taking integrity management further beyond
HCAs will put an economic burden upon the pipeline industry. We
are investigating the impacts of that right now, doing studies
for the Association. I believe we are looking into it.
Right now, every segment of a pipeline is monitored by
control rooms, SCADA systems, corrosion protection, air and
ground patrol, damage prevention; and not all pipes have
capability of running in-line inspections.
So there are different challenges that we face when we go
to different areas that go beyond HCAs, and we definitely want
to keep it to a risk-based platform and putting our resources
where it is the best place.
Mr. Larsen. And just if I may, are you going to be able to
share information back to us at some point in the near future
about your results of looking at the impact of this?
Mr. Falgoust. We absolutely will.
Mr. Larsen. And I just want to know what the timeline is
for the administration to get us a proposal on the bill.
Ms. Quarterman. I don't have a particular timeline. We are
waiting for feedback.
Mr. Larsen. Well, we will give it to you.
Ms. Brown. [Presiding.] We have less than 3 minutes before
it is time to vote, so we are going to stand in informal
recess. We have at least 30 more minutes of questions and
answers. We can have a second round if you are interested, Mr.
Larsen, but what we are going to have to do now is go and vote.
So we are going to stand in informal recess, and we will be
back. Thank you.
Ms. Brown. The Committee come back to order.
Before I get into my line of questioning, Mrs. Quarterman,
BP which is in the news every day, had several violations. What
is the status of their civil penalties or possible decree as a
result of the 2006 spill? And I want to say that on March 5th,
there was fines by the State of Washington for 27 violations,
is that correct? Can you give me an update on that?
Ms. Quarterman. I can give you a limited update because it
is in, as I understand it, in the midst of settlement
negotiations. The Department has been working with EPA and the
Department of Justice and with BP regarding the incident that
occurred in 2006. And to be candid, I don't know the ins and
outs of the negotiations that are going on, counsel's office is
working with Justice Department on that. It is ongoing.
Ms. Brown. Washington State had given them 27 serious
violations on, I want to say March 5th, and the incident
occurred around March 20th. If the oil had been on leaving the
well, it would have been our responsibility. It would have been
you-alls responsibility? If, for example, it is another
Committee because it was drilling, if they had gotten the oil
up and it was bleeding.
Ms. Quarterman. It depends on where it was if you were on a
transmission pipeline or the pipeline covered by our rules
then, yes, it would be within our jurisdiction but----
Ms. Brown. My question is what would have been different
then? What safety procedure was in place to ensure that we
could have contained the spill.
Ms. Quarterman. Well, a drilling operation and a pipeline
operation----
Ms. Brown. I understand the difference. I understand if it
was pipeline and this spill occurred, how could we ensure that
we would have been able to cut it off?
Ms. Quarterman. Well, pipelines have shutoff valves to stop
the flow. Pump stations are shut down and that kind of thing
occurs. Of course that doesn't mean that a spill would not
occur, but it would probably not be of a magnitude of a
drilling spill----
Ms. Brown. I guess my question is what assurances do we
have to the public that those cutoff valves work? Who inspects
them?
Ms. Quarterman. There is a requirement that they test the
shut-off valves.
Ms. Brown. Who is they?
Ms. Quarterman. The companies who operate them are required
to test them.
Ms. Brown. OK, and my question to you, I understand that is
the problem that we have. We have the fox watching the fox. Who
is ensuring that the hen is being protected?
Ms. Quarterman. Our inspectors are responsible for
reviewing the test records during an inspection for tests of
that nature. So we are responsible for that.
Ms. Brown. And well, I guess I want to see the procedures
in writing as far as ensuring, I hear what you are saying. That
is part of the problem that we have that the industry inspects,
and then I guess then they tell us the results. I mean, what
kind of oversight, what procedures do we have in place to
ensure that what they are saying is actually what is happening?
Ms. Quarterman. We will be happy to supply additional
information to you for the record.
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[GRAPHIC] [TIFF OMITTED] T7251.013
Ms. Brown. OK, in 2009, there were 331 reported hazardous
liquid pipeline incidents, 331. Only 100 of those 331 incidents
was reported to the public Web site meaning 68 percent of the
pipe line incidents that occurred in 2009 were not reported to
the public. This is because DOT just provide information to the
public on serious and significant incidents which meet certain
criteria. This style of reporting is misleading about the
safety of the industry. Why not provide information to the
public on all incidents reported to DOT?
It seems to me that this sort of information would be
valuable to the States that we are talking about, Florida,
Mississippi, Alabama, Washington State, Oregon, so can you
answer that question?
Ms. Quarterman. I agree with you that that information is
valuable, and I believe it is available on a link to that Web
site. The reporting of the hundred incidents is there, it is
really sort of a basis for people to be able to compare past
with past incidents. In 2002 the reporting requirements
changed, and we have on the Web site sort of a trend analysis
that goes from before 2002 forward, and I believe that there is
also a link on that site that shows all incidents. This is--I
believe those are just showing the serious and significant
incidents based on the trend which you can go backwards in
time, but the other incidents should be available there. I will
verify that.
Ms. Brown. OK, well, maybe we can get the staff together
and go over it because my staff tells me it is not readable to
the public, it is not user understandable, the way it is
reported.
Ms. Quarterman. We can check on that absolutely. We try to
be as transparent as possible.
Ms. Brown. Yes. The industry standards published in your
regulation are these industry standards published in your
regulations, are these published on the Web site or does DOT
make it publicly available in any way? My understanding is that
the Committee staff asked DOT for a certain industry standards
references in regulations. They were told that they would have
to purchase it from the industry, which is what the safety and
environmental community is also told. This seems to be
unacceptable. It is part of the Federal regulations. Can you
explain? Do you understand what I am talking about?
Ms. Quarterman. I do understand it, and I agree with you
that that is a cause for concern as you are probably aware
there is a piece of legislation that encourages Federal
agencies to incorporate by reference industries standards into
their regs. There is also OMB guidance suggesting that, and
there are many industry organizations that create these
standards, and we serve on the boards of many of those if they
are going to affect our regulations. However, because of
copyright issues, and we also publish them in the Federal
Register for comment.
However, when we publish them, we are not permitted to
publish the entire contents of the standards because of
copyright concerns, and I think it is something that could be
improved.
Ms. Brown. I think so too, because are you saying the
Federal standards, that you are working with the industry? I am
confused.
Ms. Quarterman. There are industry standards, for example,
when we talk about corrosion, there is a National Association
of Corrosion Engineers, which are experts in issues of
corrosion. And they come up with standards with respect to what
is the best way to protect against corrosion. And those
standards are ones that are considered industry best practices
and ones that we would want to include and ensure that the
industry follow those guidelines. So those are the things we
are talking about.
Ms. Brown. I understand that. But if we, let's say you are
doing a report for me and that is part of the report. That
should be part of what is made public. And it shouldn't be that
I have to purchase it from this particular association, if you
are doing a comprehensive report. I am confused. Would someone
else like to respond to that? Ms. Epstein or someone else?
Because I understand you indicated that you have to purchase
this from the industry? Explain it. I am confused.
Ms. Epstein. Yes, the industry developed consensus
standards, and they are for purchase, and they are copyrighted.
And so in order for the public to get a copy of it, they
obviously need to buy it and they are fairly costly documents.
When PHMSA incorporates that full standard, they cite it, but
they don't include all the details that are in it, and that is
a problem so industry needs to abide by the standard because it
is part of PHMSA's regulations. But it is impossible in some
sense for the public in general to know what is in it because
we can't just go online and look it up. We need to purchase it.
Ms. Brown. I guess I am confused because I understand that
we are working on best practices. But trust but verify. So just
because it is in the report, how do I know it is accurate?
Ms. Epstein. Yes I think what you are referring to is the
industry will say, OK, we are complying with the standard, and
as I understand how it works, PHMSA inspectors will try and
look at the paperwork and verify that. But there are definitely
some instances where the inspectors are not there to ensure
compliance, and many cases that may not be that critical, but
in some particular testing operations and other things, it
could be very critical that the inspectors be there.
Ms. Brown. Mr. Falgoust, what does the industry have to say
about this?
Mr. Falgoust. Well, my experience is when we are applying
for permits and things of that nature, if we reference an
industry standard, we generally supply industry standards. We
supply industry standards and discuss that with PHMSA on a
regular basis during inspection modes. And I don't know the
whole framework of how the public has access to all the
industry standards. There are many of them. However, when we
use them for representation on things that, for certain
regulations, we generally make them available, especially
referenced for a permit or other things of that nature.
Ms. Brown. I guess if we publish a documentation saying
that this is the standards, then why is it that the government
would have to purchase it in order to get a copy of it?
Mr. Falgoust. I can't speak to that. I would have to get
API or one of the associations and their standards committee to
answer that question.
Ms. Brown. I understand that it could be a standard. But I
don't know how we just take their standards without verifying
it in addition. If you are saying that you are doing certain
procedures, corrosion is a good one, and that you have come up
with certain procedures and these are the checkpoints, then we
need to verify that these are the checkpoints. I think that is
our job. And then we should publish it. And it should be
available for everybody. Or we get an independent person or
independent organization to verify. But I think the government
has a responsibility. What do you think?
Mr. Falgoust. I believe industry, when they reference
certain standards, generally will offer that standard up and
show where they are in compliance with that standard and what
they are trying to cover. Transparency we view as a very good
thing. I don't know the whole framework at how that goes and
access completely. There is many associations and different
standards that are out there, and they each had their own kind
of framework there. So that is the best I can speak to that.
Ms. Brown. Ms. Hersman and Ms. Epstein, DOT reported, and I
guess this is a follow-up committee that it has incorporated by
reference in full or part, 69 separate industry standards into
the pipeline safety regulations and 151 separate industry
standards into the hazardous material safety regulation. What
safety concern does this rise for the NTSB and the Pipeline
Safety Trust?
Ms. Hersman. The Safety Board doesn't necessarily take
exception to incorporating professional standards. But what we
do have concerns about is to make sure that those are adequate
and that those are followed and that is really the job of PHMSA
to ensure that that happens. We do sometimes, in our
investigations, look at some of those consensus or industry
standards to see if they are effective. And if we find that
there are problems, as in public awareness, educating the
public about the pipelines in the Carmichael, Mississippi
accident, we made a recommendation directly to API to evaluate
their public education programs. And so the safety board in our
investigations will look at those standards.
It is not uncommon throughout the transportation industry
to incorporate some of those industry standards. But I do think
the previous questioning that you had, it is very critical that
everyone understand exactly what those standards are for them
to be easily accessible and for them to be transparent. If you
want people to follow them, they have got to know what they
are.
Ms. Brown. I guess the follow-up question that I have there
is that, for example, on the education portion, you made the
recommendation what was the outcome of the recommendation to
educate the public, because the question earlier was about the
firefighters and the community, and we have had lots of
discussions about how do you notify the community as to what is
going through the community, so they can be prepared for a
spill or something that comes up.
Ms. Hersman. That is a great point. One of the critical
issues that we see with respect to pipeline safety is actually
knowledge that the pipeline is there and what it is carrying.
This comes into play with respect to one call programs and
excavation and digging, which is one of the big causes of
accidents.
In addition, for emergency responders, it is to make sure
that they have adequate training and awareness and
familiarization. And then it goes back also to the companies
that are on that route to make sure that they have good
communication with operators and law enforcement and first
responders along that line so that they do have adequate shut-
off if a leak is reported to make sure that they know how to
shut that pipeline down quickly and safely. And so marking is
important, making sure that there is inspection and making sure
people that are educated and have awareness.
We have seen a lot of improvements over the years with
respect to those systems and now there is a three digit call
before you dig system Nationwide, and that has been effective.
Ms. Brown. 811. My indication is that it is working. But
can you respond to that a little bit more?
Ms. Hersman. We have some anecdotal information that the
number of calls has gone up. But we still see a number of
accidents. I think the good news is that it is improving. The
bad news is that this is still one of the highest causes of
accidents and it is completely preventable. The Safety Board is
launched on an accident in Texas right now in Clairemont,
Texas, where there was a fatal event, and then a day later in
Darrouzett, Texas, there was another fatal accident that the
Texas Railroad Commission is investigating, and so we remain
concerned about these preventable accidents and think that
certainly more can be done.
Ms. Brown. Ms. Epstein.
Ms. Epstein. Yes, I would like to raise a number of points
associated with developing of the standards and implementing
them to get at your earlier questioning.
Development of the standards is, as I noted, a consensus
process and generally that means the industry together comes to
consensus. There are, if they have the resources, State
regulators involved and also Federal regulators as well.
Rarely, if ever, are there members of the public involved. That
is one concern. So it is a regulatory effort that does rarely
have enough involvement by people outside the industry except
when there is sufficient governmental involvement.
Secondly, because they are consensus standards and
sometimes there may be just a small number of companies that
might oppose something more stringent, and so you have a
situation where at times you could have a lowest common
denominator. And an example of that may be instead of using the
language ``shall,'' it may might say ``may'' or ``may
consider'' in order to get consensus.
Thirdly, there are certain things that aren't addressed.
These are gaps in the standards and those are the types of
things that whether or not consensus is involved, I would
absolutely encourage them to look for and address through
regulatory means.
And the other thing that PHMSA needs to do is make sure
that the standards are, in fact, enforceable because they can
be written in a way where there is an enormous amount of the
discretion on the part of industry, again, the example of may
consider instead of industry shall do this.
So if, in fact, there are constructed that way then I
believe there is an obligation on the part of PHMSA to
basically put in their regulation something that would take
that portion and make it enforceable if appropriate. Thank you.
Ms. Brown. Thank you. Ms. Quarterman, do you want to add to
that?
Ms. Quarterman. I would just add that PHMSA is actively
involved in creation of many consensus standards. I believe at
the moment we are involved in about 35 different standards that
are being developed for by consensus on these professional
organizations.
Ms. Brown. What procedures do we have in place, when we say
industry, and I understand that it hasn't been a lot of
accidents, but we have got to err on the side of the public and
the safety because we have several drill, deepwater drills, but
one accident can destroy the lives of the community, the
environment. So we want to make sure we have the procedures in
place to protect the environment. I mean that is what we are
supposed to do. That is our job.
So what procedures do we have, we say the industry, to get
input from the public? Do we publish? Do we have a reviewing
period before we come up with the final documentation?
Ms. Quarterman. In terms of our rules we, of course, have
to put them into the Federal Register and have public input.
I believe with respect to the ANSI standards, they also
have a public process, so public members can be involved at
that point in the process.
Ms. Brown. On the question of 811, how can we improve that
educational process? I understand it is working. How can we
make it work better?
Ms. Quarterman. I agree with Chairwoman Hersman that these
accidents are absolutely preventable. And you may know that
PHMSA was responsible for creating the 811 number and making a
national effort in this way.
And I would hope that one day it becomes as well known as
911 so that people will call before they dig, especially
recently with these two incidents in Texas, I can tell you that
the Secretary is very much focused on these events and wants to
ensure that we have a strong campaign through the summer, which
is a big digging month, for people to pay more attention to
calling before they dig.
We have been funding the Common Ground Alliance, which
really brings all the underground stakeholders together, not
just pipeline companies, but also utilities, telecom, and
educating them about calling--being involved in 811. Perhaps we
need to spend some more money in a public campaign to educate
people than we are right now.
Ms. Brown. I guess the last question, both the NTSB and Ms.
Epstein suggest that DOT should regulate all gathering lines.
Ms. Epstein recommend regulations of waterlines. In fact, there
are a number of pipelines that are exempted from Federal
regulation.
What is your response to this? Is DOT willing to review
these exemption? At the very least, why not require reporting
of incidents of all exemption pipelines so that DOT can see if
there is a need to regulate? And would this not be beneficial
to the States?
Ms. Quarterman. There are three statutory exceptions to
oversight for pipelines. One of them relates to onshore
production, refining manufacturing facilities, a second to
storage or inplant piping systems associated with onshore
production refining manufacturing facilities, and then there
are gathering lines which are defined as less than 6 inches of
low pressure and in not unusually sensitive areas, in rural
areas.
And as I said in my opening, the administration is in the
process of reviewing the existing law and looking for
opportunities to ensure that pipeline safety covers as much of
the pipeline system as possible.
In addition, we are looking internally at exemptions that
have been in the regulations for many, many years and some of
which nobody even remembers how they got there todetermine
whether or not they are still appropriate. So the notion of
gathering data, reporting data from those entities that are
responsible for--who own those pipelines, I think, is a good
one.
Ms. Brown. What is the name of the trans-Alaska pipelines
extend 800 miles, there is not any control. They are unmanned.
We are extending to another company about 1,300 miles. Are we
going to require a certain man--manned-ing of these? Because in
a lot of cases when there is problems, we find out because
someone report and it could go on for a long period of time.
Ms. Quarterman. As you know there was a recent incident
with respect to Alyeska Pipeline where----
Ms. Brown. May 25th.
Ms. Quarterman. Yes, May 25th incident, and I have had
conversations with the president of Alyeska about that incident
and will have further conversations shortly. As you may be
aware, the production there has gone from about 2 million
barrels a day to about 600,000 and they are in the process of a
strategic realignment which includes shutting down many of
their pump stations and some of which may or may not be manned.
At this point, I think we are going to continue to work
with them and talk with them about what is the appropriate
coverage for that pipeline.
Ms. Brown. TransCanada is the new company that is coming
in. They have 1,300 miles. Is it going to be manned, or
unmanned.
Ms. Quarterman. I believe you are talking about the
Keystone XL line TransCanada is from the building from the oil
sands in Canada down to the Gulf. I don't know the details of
what their plans are about the pump stations on that system.
Ms. Brown. Do we have to give them permits?
Ms. Quarterman. We do not have authority to give them any
citing permit. They have come to us with a request for a
special permit to operate that pipeline at 80 percent, and that
is in the process of being reviewed.
Ms. Brown. Well, what are some of, and you don't have to
tell me right now, what are some of the factors that you all
consider in order to give them the special permit?
Ms. Quarterman. Well, there are many factors, and each
special permit varies from one to the other. This would be a
new pipeline so we would probably go above and beyond, most
certainly, we would go above and beyond the regular
regulations, we would probably also go above and beyond the
requirements under the integrity management plan in terms of
how often they have to inspect the line for corrosion, run
pigs, that sort of thing. Obviously it is still in process so
we haven't reached a determination as to whether or not to
proceed with it. But I can certainly give you copies of other
permits, special permits where we have permitted a company to
go above 80 percent.
Ms. Brown. How important do you think the manning of these
stations with personnel if that seemed to be the problem? When
there is an incident on the line, there is no reporting.
Ms. Quarterman. I don't think I have the technical
expertise to answer that question. I will be happy to ask my
staff to get back to you. I understand many locations can be
manned with remote control. So I don't know what manning
requirements there might be.
Ms. Brown. Well, is there a trigger, and I am not a
technical person either, but is there a trigger to notify
someone if an accident has occurred, if there is a breakage in
the system?
Ms. Quarterman. There are requirements in the rule for a
leak detection system. Usually in the instance of a special
permit, the requirements would be much, shall we say, more
strenuous than those that are in the regular regs.
Ms. Brown. Well, I want thank you all of you for your
testimony today.
We are going to leave the record open so that Members and
myself can ask additional questions. But as we move forward, I
am looking forward to working closely with you and other
Members to make sure that we are very proactive in our approach
to dealing with the industry wherein you know it has to be a
balance but any error should be on the side of the public which
is our job to protect. With that, this meeting stands
adjourned.
[Whereupon, at 4:20 p.m., the Subcommittee was adjourned.]
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