[Federal Register Volume 60, Number 100 (Wednesday, May 24, 1995)]
[Notices]
[Pages 27546-27552]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-12633]



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DEPARTMENT OF THE INTERIOR
DEPARTMENT OF THE INTERIOR

Minerals Management Service

DEPARTMENT OF TRANSPORTATION

Research and Special Programs Administration


Offshore Pipelines

AGENCIES: Minerals Management Service (MMS), Interior. Research and 
Special Programs Administration (RSPA), Transportation.

ACTION: Notice of proposed revision of memorandum of understanding 
(MOU) and public meeting.

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SUMMARY: The Department of the Interior (DOI) and the Department of 
Transportation (DOT) are proposing to revise their May 6, 1976, MOU on 
their respective responsibilities concerning offshore pipelines. This 
action will redefine the boundary lines over which MMS and RSPA 
exercise their inspection and enforcement roles, giving MMS greater 
inspection responsibilities over offshore pipelines previously 
inspected by RSPA. The intent of the new MOU is to put, to the extent 
practicable, all flowlines and gathering lines under DOI 
responsibility, while transmission lines remain under DOT 
responsibility. This will result in more efficient utilization of 
government resources for offshore pipeline inspection. DOI and DOT will 
hold a public meeting on this proposed revision in New Orleans, 
Louisiana, on August 1, 1995.

DATES: Comments must be submitted on or before August 22, 1995.

ADDRESSES: Written comments should be directed concurrently to: (a) 
Department of the Interior; Minerals Management Service; Mail Stop 
4700; 381 Elden Street; Herndon, Virginia 22070-4817; Attention: Chief, 
Engineering and Standards Branch, and (b) Department of Transportation; 
Office of Pipeline Safety Regulatory Programs, Research and Special 
Programs Administration; 400 Seventh Street SW.; Room 2335; Washington, 
D.C. 20590; Attention: L.E. Herrick.

PUBLIC MEETING: DOI and DOT will hold a public meeting to receive 
comments and to discuss the proposed MOU on August 1, 1995, 8:30 a.m. 
to 5:00 p.m., Room 111; Minerals Management Service; Gulf of Mexico 
Outer Continental Shelf Region; 1201 Elmwood Park Boulevard; New 
Orleans, Louisiana 70123-2394.

FOR FURTHER INFORMATION CONTACT:
Carl W. Anderson, Engineering and Standards Branch, MMS; telephone 
(703) 787-1600; or L.E. Herrick, Office of Pipeline Safety Regulatory 
Programs; telephone (202) 366-5523.

SUPPLEMENTARY INFORMATION: 

Introduction

    There are about 18,300 miles of active Outer Continental Shelf 
(OCS) oil and gas pipelines jointly regulated by DOI and DOT under an 
MOU agreed upon in 1976 (41 FR 23746; June 11, 1976). Under the 
existing MOU, DOI has [[Page 27547]] primary responsibility for about 
4,500 miles of these pipelines delegated to the Minerals Management 
Service (MMS). DOT has primary responsibility for about 13,800 miles of 
these pipelines delegated to RSPA. The MMS regulations for pipelines in 
the OCS are in 30 CFR part 250, Subpart J. The RSPA pipeline safety 
regulations are in 49 CFR parts 190-199.
    The primary concerns with operating pipelines offshore include 
protecting life and property offshore, and protecting the OCS from 
environmental damage resulting from pipeline spills. These issues are 
of paramount importance to both MMS and RSPA. The National Academy of 
Sciences reported that while offshore oil and gas production operations 
contribute less than 2 percent by volume of the oil that is spilled 
into the sea, pipelines accounted for over 97 percent by volume of that 
oil spilled from OCS operations. These spills resulted almost entirely 
from anchors, construction operations, or fishing trawls that struck 
the pipelines and caused them to rupture.
    Corrosion-related pipeline spills tend to be minor compared to 
spills resulting from external damage; however, because the pipeline 
system is extensive and aging, MMS and RSPA are also concerned about 
oil spills resulting from corrosion.

Separate MOU on Oil-Spill Response

    Under a separate MOU among DOI, DOT, and the U.S. Environmental 
Protection Agency pursuant to the Oil Pollution Act of 1990, the 
agencies have divided their respective responsibilities for oil-spill 
prevention and response according to the definition of ``coast line'' 
contained in the Submerged Lands Act, 43 U.S.C. 1301(c). (See 59 FR 
9494; February 28, 1994.) Nothing herein is intended to affect the 
implementation or administration of that MOU.
Background

    The DOT and DOI are proposing to revise the current MOU that 
delineates DOI's and DOT's respective boundaries with respect to 
inspection of offshore pipelines in the OCS. The MOU has never been 
updated, even though there have been many legislative, regulatory, and 
administrative changes during the past 19 years affecting the 
respective inspection responsibilities that each agency performs. These 
changes, coupled with the differing regulatory priorities and operating 
responsibilities of the two organizations (MMS and RSPA) charged with 
promulgating and enforcing regulation over pipeline safety and 
environmental protection in the OCS, have rendered the MOU outdated. 
For example, the current MOU predates the following legislative and 
regulatory developments:

(1) The formation of RSPA in 1977,
(2) The 1978 OCS Lands Act Amendments,
(3) The formation of MMS in 1982,
(4) Amendments to the pipeline safety laws (see 49 U.S.C. 60101 et 
seq.), and
(5) The Federal Water Pollution Control Act as amended by the Oil 
Pollution Act of 1990 and implemented under Executive order 12777 of 
October 1991.

    Under the current MOU, RSPA is responsible for enforcing its 
design, construction, operation, and maintenance requirements on 
pipelines transporting hazardous liquids and natural gas ``to the shore 
from the outlet flange at----
    (i) Each OCS facility where hydrocarbons are produced, or
    (ii) Each OCS facility where produced hydrocarbons are first 
separated, dehydrated, or otherwise processed, whichever facility is 
farther downstream, including subsequent on-line transmission equipment 
but not including any subsequent production equipment.''
    Also under the current MOU, MMS is responsible for enforcing its 
design, construction, operation, and maintenance regulations on 
offshore pipelines extending upstream from the outlet flange described 
above into each production well in the OCS. In this regard, MMS has 
responsibilities for promulgating and enforcing regulations for the 
prevention of waste, protection of the environment, conservation of 
natural resources, production measurement, and safety of OCS lessee and 
right-of-way holder activities.
    MMS has regulatory responsibilities relating to activities 
performed in the OCS. RSPA has responsibilities for inspecting and 
enforcing its regulations over all onshore pipeline systems in the 
country. The revised MOU would result in MMS assuming a greater 
inspection responsibility for pipelines currently under DOT 
responsibility. MMS would integrate these additional pipelines into its 
current inspection program.
    Because the revised MOU would shift the boundaries being used by 
MMS and RSPA in inspecting under their regulations, some OCS pipelines 
that are currently subject to DOT regulations governing their design, 
construction, maintenance, and operations, would become subject to DOI 
regulations governing such requirements. This shift in boundary for 
areas of responsibility--generally from the first OCS facility where 
hydrocarbons are produced, separated, dehydrated, or otherwise 
processed to the last such facility--will require subsequent public 
rulemaking changes by both DOT and DOI. Following the final approval 
and signing of the revised MOU, DOT and DOI will separately propose 
changes to their respective regulations to reflect the new regulatory 
boundaries. The principal regulations that would be affected are found 
at 49 CFR parts 191.1, 192.1, 195.1 and 199 for DOT and at 30 CFR part 
250.150 for DOI.
    DOI anticipates that existing offshore pipelines that shift from 
DOT to DOI responsibility will not be immediately subject to MMS design 
and construction requirements unless: (1) those requirements were a 
condition of MMS approval for the right-of-way on which the pipelines 
are located, or (2) the pipeline undergoes major repair or 
modification. Design and construction requirements are those 
requirements that are established when the pipeline is initially 
designed and constructed, such as pipe specifications, design of 
pipeline components, and welding procedures. Retrofitting existing 
pipelines to conform to different design and construction standards can 
involve considerable risk to personnel and be extremely costly. 
Therefore, DOI will be cautious in imposing changes of this type on 
pipeline operators heretofore operating under DOT design and 
construction requirements. On the other hand, DOI operation and 
maintenance regulations, such as corrosion protection, operation and 
maintenance plans, periodic inspections, and periodic tests are 
requirements that can be applied to pipelines any time after 
construction. There are differences between DOT and DOI regulations 
with respect to these types of requirements and their compliance costs. 
therefore, any operator currently under DOT responsibility who is 
shifted to DOI responsibility--after implementation of the revised MOU 
and appropriate changes are promulgated for 30 CFR part 250.150--will 
immediately become subject to DOI operation, maintenance, and 
inspection requirements.
    Operators of pipelines that will become subject to MMS regulatory 
responsibility are reminded that MMS has regulatory procedures under 
which departures from its requirements may be granted on a case-by-case 
basis, provided there is sound engineering analysis that shows the 
operation, practice, or situation will provide an equal or greater 
level of operational safety or of environmental protection.
    Comments are invited concerning (1) the effect that the new MOU 
will have [[Page 27548]] on offshore oil and gas lessees and pipeline 
operators, (2) the time required for operations currently operating 
under DOT regulations to come into compliance with DOI regulations, (3) 
regulatory difficulties that may be involved in complying with new 
regulations, and (4) changes to the proposed MOU that would facilitate 
the implementation of the MOU.
    Upon signing the proposed revised MOU by both the Secretary of the 
Interior and Secretary of Transportation, the 1976 MOU will be 
terminated and revised MOU will become effective. The revised MOU will 
be published final in a subsequent Federal Register Notice.

    Dated: April 4, 1995.
Cynthia Quarterman,
Director, MMS.

    Dated: May 16, 1995.
D.K. Sharma,
Administrator, RSPA.
    The proposed revised MOU is as follows:

Memorandum of Understanding Between the Department of Transportation 
and the Department of the Interior Regarding Offshore Pipelines

I. Introduction

    This memorandum of Understanding (MOU) replaces the MOU between the 
Department of Transportation (DOT) and the Department of the Interior 
(DOI) regarding offshore pipelines which was signed and became 
effective May 6, 1976, and which terminates as of the effective date of 
this MOU. Nothing in this MOU relieves an offshore pipeline owner or 
operator from complying with the regulations of any State or Federal 
agency.
    In recognition of each of the parties' respective regulatory 
responsibilities, DOI and DOT agree that an MOU is needed to assure 
coordination and consultation during the development and implementation 
of regulatory requirements and to facilitate comparable regulatory 
requirements for all offshore pipelines whether under DOI or DOT 
jurisdiction.
II. Legislative and Regulatory Responsibilities of the Parties

    The DOT has the responsibility for promulgating and enforcing 
regulations for the safe and environmentally sound transportation of 
gases and hazardous liquids by pipeline. DOT administers the following 
laws as they relate to pipelines: (1) the pipeline safety laws (49 
U.S.C. 60101 et seq.), (2) the Deepwater Port Act of 1974 (33 U.S.C. 
1501-1524), and (3) the Federal Water Pollution Control Act (FWPCA) (33 
U.S.C. 1251-1375), as amended by the Oil Pollution Act of 1990 (OPA) 
(Pub. L. 101-380) and implemented under Executive Order (E.O.) 12777.
    The DOI has responsibilities for promulgating and enforcing 
regulations for the prevention of waste, protection of the environment, 
and conservation of the natural resources of the Outer Continental 
Shelf (OCS) as that area is defined in the OCS Lands Act (OCSLA) (43 
U.S.C. 1331 et seq.). These responsibilities include production 
measurement and safety of OCS lessee and right-of-way holder 
activities, including transportation of oil and natural gas by 
pipeline. DOI also has certain responsibilities for granting rights-of-
way and rights of use and easement for the construction of pipelines 
and associated facilities in the OCS. DOI administers the following 
laws as they relate to offshore piplines: (1) the OCSLA for the 
production of minerals which includes their transportation to shore, 
(2) the Federal Oil and Gas Royalty Management Act of 1982 for oil and 
gas production measurement, and (3) the FWPCA, as amended by OPA and 
implemented under E.O. 12777.
    Under a separate MOU pursuant to the OPA, DOI and DOT have divided 
their respective responsibilities for oil-spill prevention and response 
according to the definition of ``coast line'' contained in the 
Submerged Lands Act, 43 U.S.C. 1301(c).

III. Division of Responsibilities

    DOI and DOT agree to the following division of off shore pipeline 
regulatory responsibilities with respect to design, construction, 
operations, and maintenance regulations for all pipelines in the OCS 
pursuant to OCSLA. The Appendix contains nine hypothetical cases to 
illustrate how this MOU would be interpreted in practice.

DOI Responsibilities

    1. DOI will establish and enforce design, construction, operation, 
and maintenance and regulations and investigate significant accidents 
pursuant to the OCSLA for all pipelines that connect to downstream 
production or processing facilities in the OCS. The DOI area of 
responsibility will extend from producing wells to 50 meters (164 feet) 
downstream from the base of the departing pipeline riser on the last 
OCS production or processing facility (Cases 1, 7, and 9). 
Additionally, DOI will have responsibility for the following pipelines:
    a. That portion of a pipeline otherwise subject to DOT 
responsibility that crosses an OCS production or processing facility 
from 50 meters upstream of the base of the incoming riser to 50 meters 
downstream of the base of the department riser (Case 2).
    b. A pipeline from an OCS producing well or production or 
processing facility to the first subsea tie-in with a larger-diameter 
pipeline in the OCS (Cases 3, 7, and 9). However, if the first subsea 
tie-in with a larger-diameter pipeline is in State waters, DOI 
responsibility extends to the Federal-State boundary (Case 6).
    c. The OCS portion of a pipeline that connects directly to a 
production well or a production or processing facility in State waters 
(Cases 4, 8, and 9).
    d. The OCS portion of a pipeline from an OCS producing well that 
connects directly to production or processing facilities located 
onshore (Case 5).
    e. OCS production service and water lines.
    2. DOI will consult with DOT during the development of regulatory 
requirements and will send a copy of each draft notice of proposed 
rulemaking (NPR) concerning offshore pipelines to DOT for review at 
least 30 days before the NPR is published in the Federal Register. 
Publication of the NPR by DOI is not contingent upon the concurrence of 
DOT with the proposal contained in the NPR.
    3. Upon approval of right-of-way applications for pipelines under 
DOT responsibility, DOI will provide copies of its approval letters to 
DOT. When DOI grants rights-of-way for pipelines which are under DOT 
responsibility, DOI will condition its approval on the pipelines being 
designed, constructed, operated, and maintained in compliance with DOT 
regulations.
    4. The DOI will allow DOT to utilize, on a reimbursable basis, DOI-
contracted helicopters for the inspection of offshore pipelines, 
subject to helicopter availability.
    5. For pipelines under DOT responsibility, DOI will report to DOT 
in writing any apparent violation of DOT regulations that is identified 
during the course of DOI inspections.

DOT Responsibilities

    1. DOT will establish and enforce design, construction, operation, 
and maintenance regulations and investigate significant accidents for 
all offshore pipelines beginning 50 meters (164 feet) downstream from 
the base of the departing pipeline riser on the last OCS production or 
processing facility, except as provided for in paragraphs 1, 1(a), 
1(b), 1(c), 1(d), and 1(e) under ``DOI Responsibilities;'' and 
paragraph 7 under ``Joint Responsibilities.'' [[Page 27549]] 
    2. DOT will consult with DOI during the development of regulatory 
requirements and will send a copy of each draft NPR concerning offshore 
pipelines to DOI for review at least 30 days before the NPR is 
published in the Federal Register. Publication of the NPR by DOT is not 
contingent upon the concurrence of DOI with the proposal contained in 
the NPR.
    3. For pipelines under DOI responsibility, DOT will report to DOI 
in writing any apparent violation of DOI regulations that is identified 
during the course of DOT inspections.

Joint Responsibilities

    1. DOI and DOT will consult and coordinate all of their respective 
rulemaking efforts affecting offshore pipelines. Supporting regulatory 
analyses (e.g., Determination of Effects of Rules, Regulatory Impact 
Analyses, and information collection burdens, etc.) will also be 
coordinated, although the analyses will be appropriate for each agency 
and the industry segments it regulates.
    2. DOI and DOT will coordinate all of their respective research and 
development projects concerning offshore pipelines.
    3. DOI and DOT may perform joint inspections of pipeline segments 
that are subject to both DOI and DOT regulations.
    4. DOI and DOT may perform joint or independent investigations of 
accidents involving offshore pipeline segments that are subject to 
either or both DOI and DOT responsibility.
    5. DOI and DOT will provide each other with any agreement or MOU 
with any Federal or State agency concerning offshore pipelines.
    6. At least once each calendar year, DOI and DOT will jointly 
review existing standards, regulations, orders, operating practices, 
and environmental and safety issues concerning offshore pipelines.
    7. The DOI and DOT may, through their enforcement agencies, agree 
to exceptions to this MOU on a facility by facility or area by area 
basis. Affected parties shall be notified of such exceptions.

IV. Implementation

    Within 120 days of the signing of this MOU, DOI and DOT will 
develop and initiate a joint implementation plan. The plan will take 
into account differences in the regulatory requirements of DOI and DOT 
that could cause regulatory conflicts or incompatible requirements for 
those offshore pipeline segments that are subject to both DOI and DOT 
jurisdiction.
    The respective points of contact for the provisions of this MOU 
are:

Associate Administrator for Pipeline Safety, Research and Special 
Programs Administration, Department of Transportation, 400 7th Street, 
SW., Washington, D.C. 20590
Associate Director for Offshore Minerals Management, Minerals 
Management Service, Mail Stop 4000, 1849 C Street, NW., Washington, 
D.C. 20240

    Thereafter, DOI and DOT will meet periodically to review and update 
the joint implementation plan and to review this MOU for any needed 
revisions.

V. Modification

    Either party to this agreement may propose modifications by 
submitting them in writing to the head of the other Department. No 
modification may be adopted except with the consent of both parties. 
Both parties shall indicate their consent to or disagreement with any 
proposed modification within 60 days of receipt. Upon the request of 
either party, representatives of both parties shall meet for the 
purpose of considering modifications to this agreement.

VI. Termination

    This MOU may be terminated by either party upon 60-day written 
notice to the other party.

VII. Administration

    This MOU will be administered by DOI's Minerals Management Service 
and DOT's Research and Special Programs Administration or such 
successor agencies as may be designated by the respective Secretaries.

VIII. Effective Date

    This MOU is in effect upon signature.

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[FR Doc. 95-12633 Filed 5-23-95; 8:45 am]
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