[Federal Register Volume 61, Number 154 (Thursday, August 8, 1996)]
[Rules and Regulations]
[Pages 41452-41462]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-20020]



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Part II





Department of Transportation





_______________________________________________________________________



Coast Guard



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33 CFR Parts 154 and 156



Facilities Transferring Oil or Hazardous Materials in Bulk; Final Rule

  Federal Register / Vol. 61, No. 154 / Thursday, August 8, 1996 / 
Rules and Regulations  

[[Page 41452]]



DEPARTMENT OF TRANSPORTATION

Coast Guard

33 CFR Parts 154 and 156

[CGD 93-056]
RIN 2115-AE59


Facilities Transferring Oil or Hazardous Materials in Bulk

AGENCY: Coast Guard, DOT.

ACTION: Final rule.

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SUMMARY: The Coast Guard is revising the regulations covering 
facilities transferring oil or hazardous materials in bulk. These 
revisions are intended to update and clarify the current regulations. 
The revisions should result in regulations that are more effective in 
providing a high level of safety and environmental protection.

DATES: This rule is effective on February 5, 1997. The Director of the 
Federal Register approves as of February 5, 1997 the incorporation by 
reference of certain publications listed in the regulations.

ADDRESSES: Unless otherwise indicated, documents referred to in this 
preamble are available for inspection or copying at the office of the 
Executive Secretary, Marine Safety Council (G-LRA/3406), U.S. Coast 
Guard Headquarters, 2100 Second Street SW., room 3406, Washington, DC 
20593-0001, between 8 a.m. and 3 p.m., Monday through Friday, except 
Federal holidays. The telephone number is (202) 267-1477.

FOR FURTHER INFORMATION CONTACT:
Lieutenant Commander, John W. Farthing, Office of Compliance, (202) 
267-0505.

SUPPLEMENTARY INFORMATION: 

Regulatory History

    On February 23, 1995, the Coast Guard published a notice of 
proposed rulemaking (NPRM) entitled ``Facilities Transferring Oil or 
Hazardous Materials in Bulk'' in the Federal Register (60 FR 10044). 
The Coast Guard received 28 letters commenting on the proposal. One 
public meeting was requested; however, due to budgetary constraints and 
limitations imposed by organizational changes, none was held.

Background and Purpose

    Until 1990, the regulations covering the transfer of products 
between vessels and facilities capable of transferring oil or hazardous 
materials in bulk to or from a vessel with a capacity of 250 barrels or 
more were contained in two different parts of the Code of Federal 
Regulations (CFR). Facilities transferring oil in bulk were covered by 
33 CFR part 154, while those transferring hazardous materials in bulk 
were covered by 33 CFR part 126 (Handling of Explosives or Other 
Dangerous Cargoes Within or Contiguous to Waterfront Facilities). The 
Coast Guard consolidated and revised the provisions in part 154 
(Facilities Transferring Oil or Hazardous Materials in Bulk) in a final 
rule published on September 4, 1990 (55 FR 6252). Since that time, 
numerous comments have been received from industry and Coast Guard 
personnel about problems arising from implementation of part 154. The 
NPRM addressed proposed changes to alleviate these problems.
    These regulations have also been reviewed under the Coastal Zone 
Management Act of 1972 (CZMA), (16 U.S.C. 1451 et seq.), as amended, 
and its implementing regulations, 15 CFR Parts 921, 923, 925, 927, 928, 
932 and 933 as promulgated by the National Oceanic and Atmospheric 
Administration (NOAA). Among other things, the CZMA requires that an 
applicant for a Federal license or permit to conduct any activity 
``affecting any land or water use or natural resource of the coastal 
zone'' must provide to the licensing or permitting agency a 
certification that the proposed activity will comply with the approved 
Coastal Zone Management Program of any affected State (16 U.S.C. 
1456(c)(3)). The CZMA Federal consistency requirements further provide 
that no Federal license or permit may be granted until the affected 
State(s) have concurred with the applicant's certification, such 
concurrence is presumed, or the Secretary of Commerce has found that 
the activity either is consistent with the CZMA or in the interest of 
national security (16 U.S.C. 1456(c)(3)(A)).
    However, 16 U.S.C. 1456(f) exempts from Federal consistency 
determinations any requirement imposed by or established pursuant to 
the Federal Water Pollution Control Act (FWPCA), as amended (33 U.S.C. 
1251 et seq.).
    Similarly, 16 U.S.C. 1456(e)(1) provides that the CZMA does not 
diminish Federal or state jurisdiction over the planning, development, 
or control of water resources, submerged lands, or navigable waters, 
among other things.
    The regulations established in parts 154 and 156 of this rulemaking 
could appear to implicate the CZMA and its Federal consistency 
requirement because they require Coast Guard approval for bulk 
transfers of oil or hazardous materials between facility's and vessels, 
for approval of a facility's Operations Manual, and for any alternative 
procedure or equipment used to comply with these regulations. These 
activities appear to be the type that may affect land or water use or a 
natural resource of a coastal zone.
    These requirements are intended to protect the coastal environment. 
The Coast Guard does not anticipate any conflict between these 
regulations and a State's coastal zone management plan. However, 
because these regulations are issued under the authority of the FWPCA, 
as amended by the Water Quality Act of 1987 (Pub. L. 100-4, 101 Stat. 
75) and the Oil Pollution Act of 1990 (Pub. L. 101-380, 104 Stat. 507 
et seq.), the Coast Guard finds they are exempt from CZMA consistency 
requirements under 16 U.S.C. 1456(f).
    The FWPCA requires the issuance of regulations to prevent the 
discharge of oil or hazardous materials from vessels and facilities, to 
require installation and inspection of discharge removal equipment on 
vessels, and to require monitoring, reporting, and recordkeeping 
regarding discharges of oil or hazardous materials by facilities (33 
U.S.C. 1321(j)(1) (C) and (D), (j)(6) and (m)(2)).
    The Coast Guard notes that the existing part 154 and 156 
regulations also cite the Ports and Waterways Safety Act (33 U.S.C. 
1231) regarding ports and waterways regulations and 46 U.S.C. 3715 
regarding lightering; however, those provisions do not address the core 
purpose of this rulemaking, which is to regulate bulk oil and hazardous 
materials transfers between facilities and vessels. In contrast, the 
regulations being implemented today are promulgated under the mandate 
of the FWPCA and are consequently exempt from the CZMA's Federal 
consistency requirements (16 U.S.C. 1456(f)).

Discussion of Comments and Changes

    The Coast Guard received 28 letters commenting on the NPRM entitled 
``Facilities Transferring Oil or Hazardous Materials in Bulk'' 
published in the Federal Register on February 23, 1995 (60 FR 10044), 
and has considered the comments in developing this final rule.

Weights and Measures

    Coast Guard regulatory practice is that primary weights and 
measures be specified in metric units. Therefore, this rule specifies 
all weights and measures in metric units followed by English 
equivalents. The conversion of weights and measures ensure that 
equipment or procedures complying with the English values in the NPRM 
will also comply with the metric values in this rule.

[[Page 41453]]

Therefore, the conversions should have no impact on compliance with 
this rule.

Applicability

    Four comments addressed the proposed changes to Sec. 154.100. Two 
of these comments requested that the wording of this section be 
clarified to state that these regulations do not apply to offshore 
facilities regulated under the Department of Interior's (DOI's) 
Minerals Management Service (MMS) regulations in 33 CFR 250. Under 
Executive Order 12777, jurisdictional responsibility for offshore 
facilities was delegated to MMS. On February 3, 1994, under the 
Memorandum of Understanding (MOU) between DOI, the Environmental 
Protection Agency (EPA) and the Department of Transportation (DOT), 
spill prevention and control, contingency planning, and equipment 
inspection activities associated with offshore facilities were assigned 
to the DOI. Section 154.100 has been revised to clarify that this part 
does not apply to offshore facilities operating under the jurisdiction 
of the Secretary of the DOI.
    A new paragraph is added to the applicability section which 
specifies all of the requirements that are applicable to mobile 
transfer facilities.

Definitions

    The definitions of ``caretaker status'', ``marine transfer area'', 
and ``onshore facility'' have been added, and the definitions of 
``facility'', ``offshore facility'' and ``transfer'' have been revised.
    The Coast Guard is adding a definition of ``caretaker status'' to 
these regulations. ``Caretaker status'' is used to identify a facility 
whose marine transfer equipment has been taken out of service. Two 
comments discussed the proposed definition of ``caretaker status'' in 
the NPRM. One of these comments stated that existing state requirements 
for decommissioning criteria obviate the need for a new Federal 
definition. One of these comments stated that the Coast Guard should 
further justify the need to define the term ``caretaker status''. The 
Coast Guard does not agree with these comments. The revised regulations 
contain numerous references to facilities that are in a ``caretaker 
status''. Without clear definition of this term, it would be difficult 
for industry to comply with Coast Guard regulations. The proposed 
definition has been clarified to state that it only applies to those 
parts of a waterfront facility subject to Coast Guard jurisdiction.
    The Coast Guard is also adding a definition for ``marine transfer 
area'' to these regulations. This term is used several times in the 
existing and revised regulations but has not been previously defined. 
The new definition is similar to the one found in other Coast Guard 
waterfront facility regulations and is intended to delineate those 
areas of a waterfront facility subject to Coast Guard jurisdiction.
    Two comments addressed the proposed definition of ``facility''. One 
comment requested that a definition of ``onshore facility'' be added to 
the regulations. The Coast Guard agrees with this comment and is adding 
the definition of ``onshore facility'' as found in the Federal Water 
Pollution Control Act (FWPCA) [33 U.S.C. Sec. 1321(a)(10)]. The 
definition of ``facility'' has also been clarified to exclude offshore 
facilities operating under the jurisdiction of the Secretary of the 
DOI. Additionally, the definition of ``offshore facility'' has been 
revised to conform with the definition in the authorizing legislation.
    Eight comments addressed the proposed revision to the definition of 
``transfer''. One comment supported the proposed definition as written. 
Seven comments strongly objected to the proposed definition. The 
majority of the dissenting comments stated that the proposed definition 
would create a regulatory conflict with the requirements of 33 CFR 
156.150 which specifies that a transfer may not take place until the 
declaration of inspection and all necessary inspections have been 
completed by the persons in charge. One comment also requested that the 
definition be revised to indicate when a transfer is considered 
complete. After review of industry comments, the Coast Guard is 
revising the definition of ``transfer'' to state that a transfer begins 
when the persons in charge meet to begin the process of completing the 
declaration of inspection. This revised definition recognizes standard 
industry practices and better focuses the intent of the regulations on 
those actions that directly lead to the flow of products. The 
definition of ``transfer'' is also being revised to state that a 
transfer is considered complete when all the connections for the 
transfer have been uncoupled and secured, and when the persons in 
charge have completed the declaration of inspection to specify the date 
and time the transfer was completed. The rule contains an amendment 
that is consistent with the regulations in Sec. 156.150.

Alternatives

    Three comments discussed the proposed changes to Sec. 154.107. 
These comments generally objected to the extended time frame for review 
of a request for alternative procedures, methods or equipment 
standards, suggesting that industry could be subjected to hardship if a 
facility operator had to wait 60 days for the Captain of the Port 
(COTP) to complete the examination of a request for an alternative. 
After further review, the Coast Guard is retaining the 30 day time 
period for COTPs to review proposed alternatives.

Letter of Intent

    One comment was received on the proposed changes to Sec. 154.110 
citing that it would be more appropriate to change the requirement in 
Sec. 154.1035 to include the requirement for the name of the facility 
owner in the Facility Response Plan (FRP). The Coast Guard disagrees 
with this comment. The Coast Guard recognizes that including this 
information may be duplicative of the FRP requirements; however, FRP 
requirements currently only apply to facilities transferring oil and 
not to those facilities transferring hazardous materials. As stated in 
the preamble to the NPRM, this additional information will be of great 
assistance in determining and locating the responsible party during a 
spill or other emergency.

Operations Manual: Contents

    Seven comments discussed the proposed changes to Sec. 154.310. The 
majority of the comments stated that the proposed facility map 
requirement was redundant to the information required in the FRP. The 
Coast Guard recognizes that this requirement may be duplicative for 
some facilities; however, the FRP requirements currently only apply to 
those facilities that transfer oil, not to those facilities 
transferring hazardous materials. Several of these comments also 
objected to the requirement for a single map of the facility, drawn to 
scale, to be included in the Operations Manual. The majority of these 
comments noted that, for large facilities, a single map of this type 
would be impractical. The Coast Guard agrees with these comments and is 
revising the proposed requirement to allow multiple maps, plans, 
drawings, diagrams or aerial photographs that are considered acceptable 
by the COTP in order to comply with this requirement.
    Four comments addressed the proposal that Material Safety Data 
Sheets (MSDS) be included in the Operations Manual rather than the 
information currently required by paragraph 154.310(a)(5). The majority 
of comments supported the use of the MSDS, but objected to the 
requirements that they be included in the Operations

[[Page 41454]]

Manual. Several comments noted that as large facilities routinely 
handle a high volume of products, the Operations Manual could increase 
in size by more than a thousand pages. The Coast Guard agrees with 
these comments. Noting that facilities are currently required to 
maintain MSDSs under subpart F of this part, and under other Federal, 
State or local regulations, the Coast Guard is retaining the current 
product information requirements in Sec. 154.310(a)(5).
    Eight comments discussed the proposal to add the names and 
telephone numbers of state and local officials to the list of names and 
addresses currently required under paragraph 154.310(a)(7). The 
majority of the comments stated that the inclusion of this information 
was redundant to the information required by the FRP. The Coast Guard 
recognizes this information may be duplicative for some facilities; 
however, the Coast Guard emphasizes the importance of this information 
and the necessity that it be readily available to transfer personnel. 
Several comments requested that the requirement be reworded to allow 
the title and position of the appropriate Federal, State and/or local 
officials' name to be listed, because of the frequency in personnel 
changes. The Coast Guard agrees with these comments and has revised the 
regulations to require that the title and/or position instead of the 
name be included.
    Two comments discussed the proposed requirement that the maximum 
allowable working pressure (MAWP) be recorded in the Operations Manual. 
Both comments supported the inclusion of this information; therefore, 
the proposed language is retained. An editorial correction is also made 
to paragraph 154.310(a)(15) to correct the reference.
    Four comments addressed the proposed extension of the response 
period from 14 to 45 days under paragraph 154.320(a)(1), which amends 
the Operations Manual after examination by the COTP. All of these 
comments supported the extension of the facility response time in order 
to better identify any inadequacies found by the COTP. The proposed 
language is retained. Also, an editorial correction is made to 
paragraph 154.320(d) to correct the reference.

Operations Manual: Procedures for Examination

    The Coast Guard is revising its procedures for reviewing and 
approving Operations Manuals in paragraphs 154.300 and 154.325. Rather 
than issue a Letter of Adequacy each time an Operations Manual is 
reviewed and/or amended, COTPs will now examine the manual to verify it 
meets the requirements of this chapter. Facility operators will now 
submit two copies of their Operations Manual, or any changes, to the 
COTP for review. If the manual, as submitted, meets the requirements of 
this chapter, the COTP will return one copy to the facility operator 
marked ``Examined by the Coast Guard''. This change will alleviate some 
of the paperwork burden on COTPs and on the industry, and conform the 
Operations Manual regulations in this chapter to other U.S. Coast Guard 
waterfront facility regulations.

Hose Assemblies

    Five comments discussed the proposed changes to Sec. 154.500. One 
comment supported the proposed language as written. Another comment 
stated that some arrangement must be made to ensure that vessels 
pumping ashore to the receiving facility do not exceed the facility's 
MAWP. The Coast Guard agrees with this comment, and an amendment that 
conforms to Sec. 156.120 is being included to ensure that as part of 
the process of completing the declaration of inspection, the persons in 
charge shall ensure that the transfer pressure does not exceed the 
facility's MAWP. Two comments objected to the proposed change, stating 
that the current requirements have become industry standards and 
changing them would be counterproductive to the intent of the proposed 
rule. The Coast Guard does not agree with these comments. As stated in 
the NPRM, it is more reasonable for the MAWP to be based on the actual 
operational pressure of the transfer system, rather than a pre-
specified number. When the MAWP is based on the actual operational 
pressure, industry can develop tests and inspection criteria based on 
the needs of the system, avoiding unnecessary expense by testing to a 
level far higher than that of their systems' operational pressure.

Closure Devices

    Two comments agreed with the proposed changes to Sec. 154.520. One 
of these comments requested that language be included stating that a 
gasket or other suitable material be installed along with a closure 
device. The Coast Guard agrees with this comment and has added language 
similar to the requirement in Sec. 156.130 for closure devices.

Small Discharge Containment

    Thirteen comments addressed the proposed changes to Sec. 154.530. 
All of these comments objected to adding the proposed requirement that 
fixed or portable containment be placed under each hose connection 
during coupling, uncoupling, and transfer. The majority of the comments 
noted that hoses used for transfer operations are normally comprised of 
several lengths of hoses flanged together with permanent connections 
and it would be infeasible to provide containment under every 
connection as they are often located over water or in a vertical 
alignment where it is impossible to place containment. Noting that 
paragraph 156.120(p) requires the persons in charge to ensure that all 
connections in the transfer system are leak free prior to transfer and 
that paragraph 156.130 allows for permanently connected flanges, the 
Coast Guard has clarified Sec. 154.530 to state that containment is 
required under each hose connection that will be coupled or uncoupled 
as part of the transfer operation during coupling, uncoupling and 
transfer.

Discharge Removal

    Ten comments discussed proposed changes to Sec. 154.540. All of 
these comments objected to the proposed 1 hour time requirement for 
removal of any discharge into the containment. These comments opposed 
the new requirement as too restrictive and requested that the 
flexibility of the existing language be retained. Noting the 
requirement in paragraph 156.120(n) and that the discharge containment 
should be periodically drained to provide the required capacity, the 
Coast Guard is revising the proposed language to require that any 
discharged product by removed from the containment within 1 hour of 
completion of the transfer.
    The NPRM proposed to add a paragraph to Sec. 154.545 that would 
specify that equipment required to be retained under this section may 
be used in the planning requirements of the facility response plan 
required by subpart F. No comments were received on this recommendation 
and the proposed language is retained.

Communications

    Four comments discussed the proposed changes to Sec. 154.560. Two 
comments agreed with the proposed changes. One comment noted that 
labels tend to wear off over time or become unreadable and, as an 
alternative, suggested that each facility should be allowed to maintain 
documentation on

[[Page 41455]]

the premises certifying that the equipment in use is intrinsically 
safe. The Coast Guard agrees with this comment and has revised the 
proposed language to allow facility operators the option of maintaining 
documentation at the facility, which shows that the equipment in use 
meets the requirements of this part. An amendment which conforms to 
Sec. 154.740 is also included in the requirement to have these records 
available for inspection by the COTP.

Persons in Charge: Designation and Qualification

    Fifteen comments discussed the proposed changes to Sec. 154.710. 
Some confusion resulted from a misprint in the NPRM that listed 
Sec. 154.720(a)(23) as a reference. The correct reference should have 
read Sec. 154.310(a)(21), which requires a description of the training 
program for persons in charge to be included in the Operations Manual. 
The majority of the comments objected to a separate approval of the 
facility's training program by the COTP, as this could lead to vast 
disparity among the different COTPs as to what training is required. 
The majority of the comments also noted that by examining the 
Operations Manual, the COTP is already examining the training program 
since it is described there in accordance with Sec. 154.310(a)(21). The 
Coast Guard agrees with these comments and is removing the requirement 
for the COTP to separately approve the facility's training program.
    Seven comments addressed the proposal that the person in charge 
(PIC) should be in visual sight of the transfer system from the time a 
hose connection is completed, until the time the connection is broken. 
All of these comments objected to this requirement as unreasonable and 
impractical. Several of these comments also noted the requirements in 
paragraphs 156.160 (a) and (c) where each PIC must directly supervise 
certain critical operations and must be in the immediate vicinity, 
immediately available to the transfer personnel. Upon further review, 
the Coast Guard is removing this proposal.
    The Coast Guard wishes to clarify that the requirements for 
designation and qualification as a PIC in this rule apply only to 
waterfront facility personnel. The requirements for designation and 
qualification as a PIC on vessels are contained in a separate 
rulemaking entitled ``Qualifications for Tankermen, and for Persons in 
Charge of Transfers of Dangerous Liquids and Liquefied Gases'' (61 FR 
17134; April 4, 1995).
    New paragraph (e) is being added to Sec. 154.710 to state that 
training to meet other regulatory requirements can be used to meet the 
requirements of this section as long as that training addresses the 
requirements of this section.

Safety Requirements

    Twelve comments discussed the proposed changes to Sec. 154.735. Two 
of these comments supported the continuation of the hot work permit 
program. Several comments supported doing away with the hot work 
permit, but objected to the responsibility for the safety of all hot 
work on vessels moored to the facility being placed on the facility's 
owner and operator. These comments noted the difficulty a facility 
would have in providing oversight and subsequent liability concerns. 
The Coast Guard agrees with these comments and has removed the language 
concerning hot work on vessels, noting that hot work on tankships and 
tank barges is already regulated under 46 CFR 
35.01-1.
    Three comments addressed the proposed changes to Sec. 154.735(s) 
providing that tank cleaning or gas freeing operations conducted by the 
facility on vessels carrying oil residues or mixtures be conducted in 
accordance with specified sections of the International Safety Guide 
for Oil Tankers and Terminals (ISGOTT). The provision to allow facility 
owners or operators to request the COTP to approve, in accordance with 
Sec. 154.107, alternative methods of compliance based on sound industry 
practices satisfied these comments. One comment stated that the ISGOTT 
manual was being revised in the near future and that the referenced 
sections would have to be updated. The Coast Guard has reviewed the new 
version of the ISGOTT manual and revised this section accordingly.
    Seven comments addressed the proposed security requirements for 
waterfront facilities. All of these comments objected to the proposed 
requirements. These comments outlined the existing procedures currently 
used by facilities for controlling access to marine transfer areas such 
as fencing, gates, and video surveillance. The revised rule has been 
reworded in a manner similar to the existing text to allow facilities 
more flexibility in their security arrangements based on existing 
procedures and local conditions. The proposed requirement that 
personnel have facility-issued identification cards has been removed.
    No comments were received on the proposal to prohibit smoking at 
waterfront facilities except in designated areas; therefore, the 
proposed language is retained.
    Five comments discussed the proposal to require that three-way 
warning signs, similar to those required under 33 CFR 126.15(o)(2)(i), 
be displayed on the facility at the point of transfer, without 
obstruction, at all times, on a fixed facility, and during coupling, 
transfer operations, and uncoupling on a mobile facility. Two of these 
comments supported the proposal as written. One comment requested that, 
since the requirements for tank vessels and tank barges already cover 
the requirements for warning signs at the point of transfer, the 
location of the warning signs should be at each shoreside entrance to 
the dock or berth for fixed facilities. The Coast Guard agrees with 
this comment and has revised the final rule accordingly. One of these 
comments requested that facilities with non-exclusive use of dock space 
be allowed to use portable signs posted only during transfer 
operations. While the Coast Guard agrees with this comment, it believes 
this method does not need to be a regulatory requirement, but rather an 
alternative that the COTP can approve on a case by case basis.

Records

    Seven comments discussed the proposed changes to Sec. 154.740. The 
majority of these comments supported the maintaining of records in a 
central location. However, all of the comments objected to the 
requirement that these records be maintained in the same location as 
the Operations Manual. The majority of these comments noted that, 
particularly at large facilities, there are multiple copies of the 
Operations Manual scattered throughout the facility; however, requiring 
these records at each location would create a heavy paperwork burden on 
the industry. The majority of these comments requested that the 
facility be allowed to designate a centralized location for these 
records, since many of them are already computerized. The Coast Guard 
agrees with these comments and has revised the final rule to allow 
facilities flexibility in designating a centralized location where the 
records will be kept.
    Conforming changes to certain sections of 33 CFR part 156 have been 
made to ensure consistency with the changes made to part 154.

Requirements for Transfer

    In 33 CFR 156.120 the definition of ``transfer'' has been revised 
to conform to the definition in Sec. 154.105. As previously discussed, 
other amendments have been revised to conform to Sec. 156.120(w)(5) to 
ensure that transfer pressures do not exceed a

[[Page 41456]]

facility's maximum allowable working pressure (MAWP). A new paragraph 
(dd) has been added to Sec. 156.120 to clarify that welding, hot work 
and smoking will not be permitted on vessels during transfer 
operations. The Coast Guard recognizes that smoking on tank barges or 
tank vessels is currently regulated under 46 CFR 35.30-5. However, 
numerous problems have developed because vessel personnel have been 
discovered smoking during the bunkering of freight vessels which are 
not currently covered under the regulations. An editorial correction is 
made to Sec. 156.120(f) to correct the reference.

Supervision by Person in Charge

    Eight comments addressed the proposed changes to Sec. 156.160. All 
of these comments objected to the proposed requirement as impractical 
and infeasible due to the length of time that transfers take, and the 
need to occasionally stop a transfer for weather, other facility 
operations, equipment checks, or crew rest breaks. The Coast Guard 
agrees with these comments and has retained the original text of the 
regulations.

Equipment Tests and Inspections

    Five comments addressed the proposed changes to Sec. 156.170. One 
comment requested that, as stated in the preamble, language in the 
final rule include a provision stating that the test medium does not 
have to be water. The Coast Guard agrees with this comment and has 
revised the final rule accordingly. However, facility operators are 
cautioned against using oil or hazardous material as a test medium. 
Because leaks are an expected result of any test, a discharge of oil or 
hazardous material resulting from a test could be considered a willful 
discharge. An editorial correction is made to Sec. 156.170(c)(1)(i) to 
correct the reference.
    One comment requested that components that have been gas-freed and 
blanked-off be exempted from the testing requirements. This comment 
stated that industry frequently takes some components out of service 
for extended periods of time; therefore, these components should not be 
required to be tested unless they are returned to service. The 
revisions to the proposed text allow this option as the Coast Guard has 
removed the word ``active'' from the proposed Sec. 156.170(f)(1) so 
that facilities that are not in a caretaker status will be required to 
conduct their tests either annually, or not less than 30 days prior to 
the first transfer past the one year inspection date. For example, if a 
facility had previously tested its components, and then had removed 
these components from service for the previous 15 months, this facility 
would be required to test the components that had been removed from 
service not less than 30 days prior to the first transfer using the 
components.
    Two comments supported the proposal to give the COTP the authority 
to approve alternative methods of compliance to the testing 
requirements in this section. Therefore, the proposed language is 
retained.

Exemptions

    Editorial corrections are being made to Sec. 154.108 and 
Sec. 156.110 to reflect the change in the office title from Chief, 
Office of Marine Safety, Security and Environmental Protection to the 
Chief, Marine Safety and Environmental Protection. This change is a 
result of recent Coast Guard streamlining initiatives.

Incorporation by Reference

    The Director of the Federal Register has approved the material in 
Sec. 154.106 for incorporation by reference under 5 U.S.C. 552 and 1 
CFR part 51. The material is available as indicated in that section.

Regulatory Evaluation

    This is not a significant regulatory action under section 3(f) of 
Executive Order 12866 and does not require an assessment of potential 
costs and benefits under section 6(a)(3) of that order. It has not been 
reviewed by the Office of Management and Budget under that order. It is 
not significant under the regulatory policies and procedures of the 
Department of Transportation (DOT) (44 11040; February 26, 1979). A 
draft Regulatory Evaluation under paragraph 10e of the regulatory 
policies and procedures of DOT has been prepared and is available in 
the docket for inspection or copying where indicated under ADDRESSES. 
The Evaluation is summarized as follows:
    It is estimated that 2,591 fixed and 539 mobile marine 
transportation related facilities will be affected by these 
regulations. Many of the revisions are clarifying changes that will 
impose no additional costs on facilities presently in compliance with 
the regulations. For example, information previously kept separately is 
now required to be kept in the same location. Since this information is 
not required to be included in the operations manual, no additional 
cost is incurred for the review by the Coast Guard or the facility.
    There are some new requirements associated with this Final Rule. 
These requirements include the following: a map or maps, drawings, or 
other diagrams acceptable to the COTP showing the boundaries of the 
Coast Guard's jurisdiction (Sec. 154.310(a)(2)); additional 
requirements for mobile transfer facilities including sufficient fire 
extinguishers, protective equipment, three-way warning signs, 
electrical wiring and the ``person in charge requirements'' 
(Sec. 154.100(d)); a more extensive training and qualification program 
for persons in charge (Sec. 154.710(c)); and three-way warning signs 
(Sec. 154.735(v)).
    However, other revisions lessen the burden on industry. Examples of 
the reduction in burden are the deletion of the requirement that 
transfer hoses have a maximum allowable working pressure of at least 
150 psi (Sec. 154.500(b)) and deletion of the requirement for a 
facility to obtain a hot work permit (Sec. 154.735(1)).
    In consideration of the additions and deletions to part 154 and 
156, it is estimated that the annual net cost to all facilities would 
be $5,448,235, when capital costs are incurred over a 5 year period.
    The overriding benefit of the regulations to industry and the Coast 
Guard would be the establishment of rules that are easier to understand 
and that would facilitate and foster industry compliance, leading to a 
higher level of environmental protection.
    The direct monetary benefit of increased protection would come from 
the reduction of spills resulting from facility operations. These 
regulations are designed to achieve an overall reduction of oil and 
hazardous materials spilled into the water by 20%. The weighted average 
of the annual volume of bulk oil and hazardous material spilled from 
1986 to 1995 from facilities was 4,124,430 gallons. The estimated costs 
of spill cleanup, third party damages, and natural resource damages 
resulting from this volume total $82,488,600. a 20% reduction will give 
an annual benefit of $16,497,720.
    Comparing the monetary benefits of the provisions against the 
compliance cost to industry, the annual benefit of the regulations is 
estimated to be $11,049,485.

Small Entities

    Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) and 
1996 amendments (enacted as Chapter 8 of Title 5, U.S. Code) the Coast 
Guard must consider whether this rule, if adopted, will have a 
significant economic impact on a substantial number of small

[[Page 41457]]

entities. ``Small entities'' may include (1) small businesses and not-
for-profit organizations that are independently owned and operated and 
are not dominant in their fields and (2) governmental jurisdictions 
with populations of less than 50,000.
    The majority of facilities are owned by large corporations. The new 
requirements established by this rule, measured against the proposed 
relief from other requirements currently in effect, will result in a 
negligible cost increase for facilities that presently comply with part 
154.
    Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that 
this rule, as adopted, will not have a significant economic impact on a 
substantial number of small entities.

Collection of Information

    Under the Paperwork Reduction Act (44 U.S.C. 3501 et seq.), the 
Office of Management and Budget (OMB) reviews each proposed rule that 
contains a collection-of-information requirement to determine whether 
the practical value of the information is worth the burden imposed by 
its collection. Collection-of-information requirements include 
reporting, recordkeeping, notification, and other, similar 
requirements.
    This rule contains new collection-of-information requirements in 
the following sections: Sec. 154.310 and Sec. 154.560. The following 
particulars apply:
    DOT No.: 2115.
    OMB Control No.: 2115-0078.
    Administration: U.S. Coast Guard.
    Title: Changes to regulations covering Facilities Transferring Oil 
or Hazardous Materials in Bulk.
    Need for Information: It is required that information, presently 
kept separately, now be kept in a centralized location. However, little 
new information is required. Maintaining all records in one location 
where they are readily accessible will encourage facility owners and 
operators to be better prepared and thereby help to prevent spills and 
accidents resulting from improper procedures.
    Proposed Use of Information: To determine regulatory compliance.
    Frequency of Response: On occasion.
    Burden Estimate: 22,632 hours per year.
    Respondents: 3,130 operators of bulk oil and hazardous materials 
transfer facilities.
    Form(s): Not applicable.
    Average Burden Hours per Respondent: 15.8 hours to prepare and 
submit an amendment to an existing Operations Manual and 88 hours to 
prepare and submit a new Operations Manual.
    Persons are not required to respond to a collection of information 
unless it displays a currently valid OMB control number. This final 
rule contains information collection requirements which have been 
approved under OMB no. 2115-0078 and which expires on July 31, 1996. 
The Coast Guard has submitted the requirements to OMB for review and 
renewal under section 3504(h) of the Paperwork Reduction Act.
    The U.S. Coast Guard will publish a notice in the Federal Register 
prior to the effective date of this final rule of OMB's decision to 
approve, modify or disapprove the information collection requirements. 
Individuals and organizations may submit comments on the information 
collection requirements by October 7, 1996, and should direct them to 
the Executive Secretary, Marine Safety Council (address above) and to 
the Office of Information and Regulatory Affairs, OMB, New Executive 
Office Bldg., rm 10235, 725 17th St. NW., Washington, DC 20503, 
Attention: Desk Officer for DOT.

Federalism

    The Coast Guard has analyzed this rule under the principles and 
criteria contained in Executive Order 12612 and has determined that 
this proposal does not have sufficient federalism implications to 
warrant the preparation of a Federalism Assessment.

Environment

    The Coast Guard considered the environmental impact of this final 
rule and concluded that, under paragraph 2.B.2.e(34)(A), (D), and (E) 
of Commandant Instruction M16475.1B, this rulemaking is categorically 
excluded from further environmental documentation.
    This rulemaking will have no direct environmental impact. This 
rulemaking will revise the regulations covering facilities transferring 
oil or hazardous material in bulk. these revisions will clarify and 
consolidate the present rules, as well as adding a number of new 
operational requirements. A ``Categorical Exclusion Determination'' is 
available in the docket for inspection or copying where indicated under 
``ADDRESSES''.

List of Subjects

33 CFR Part 154

    Fire prevention, Hazardous substances, Oil pollution, Reporting and 
recordkeeping requirements, Incorporation by reference.

33 CFR Part 156

    Hazardous substances, Oil pollution, Reporting and recordkeeping 
requirements, Water pollution control.

    For the reasons set out in the preamble, the Coast Guard is 
amending 33 CFR parts 154 and 156 as follows:

PART 154--FACILITIES TRANSFERRING OIL OR HAZARDOUS MATERIAL IN BULK

    1. The authority citation for part 154 continues to read as 
follows:

    Authority: 33 U.S.C. 1231, 1321(j)(1)(C), (j)(5), (j)(6) and 
(m)(2); sec. 2, E.O. 12777, 56 FR 54757; 49 CFR 1.46. Subpart F is 
also issued under 33 U.S.C. 2735.

Subpart A--General

    2. In Sec. 154.100, paragraph (a) is revised and paragraph (d) is 
added to read as follows:


Sec. 154.100   Applicability.

    (a) This part applies to each facility that is capable of 
transferring oil or hazardous materials, in bulk, to or from a vessel, 
where the vessel has a total capacity, from a combination of all bulk 
products carried, of 39.75 cubic meters (250 barrels) or more. This 
part does not apply to the facility when it is in a caretaker status. 
This part does not apply to any offshore facility operating under the 
jurisdiction of the Secretary of the Department of Interior.
* * * * *
    (d) The following sections of this part apply to mobile facilities:
    (1) Section 154.105 Definitions.
    (2) Section 154.107 Alternatives.
    (3) Section 154.108 Exemptions.
    (4) Section 154.110 Letter of Intent.
    (5) Section 154.120 Facility examinations.
    (6) Section 154.300 Operations Manual: General.
    (7) Section 154.310 Operations Manual: Contents. Paragraphs (a)(2), 
(a)(3), (a)(5) through (a)(7), (a)(9), (a)(12), (a)(14), (a)(16), 
(a)(17)(ii) through (a)(17)(iv), (a)(18), (a)(20) through (23), (c) and 
(d).
    (8) Section 154.320 Operations Manual: Amendment.
    (9) Section 154.325 Operations Manual: Procedures for examination.
    (10) Section 154.500 Hose assemblies. Paragraphs (a), (b), (c), 
(d)(1) through (3) and (e)(1) through (3).
    (11) Section 154.520 Closure devices.
    (12) Section 154.530 Small discharge containment. Paragraphs (a)(1) 
through (3) and (d).
    (13) Section 154.545 Discharge containment equipment.
    (14) Section 154.550 Emergency shutdown.

[[Page 41458]]

    (15) Section 154.560 Communications.
    (16) Section 154.570 Lighting. Paragraphs (c) and (d).
    (17) Section 154.700 General.
    (18) Section 154.710 Persons in charge: Designation and 
qualification. Paragraphs (a) through (c), (d)(1) through (3), (d)(7) 
and (e).
    (19) Section 154.730 Persons in charge: Evidence of designation.
    (20) Section 154.735 Safety requirements. Paragraphs (d), (f), (g), 
(j)(1) through (2), (k)(1) through (2), (m), (o) through (q), (r)(1) 
through (3), (s) and (v).
    (21) Section 154.740 Records. Paragraphs (a) through (f) and (j).
    (22) Section 154.750 Compliance with Operations Manual.
    3. In Sec. 154.105, the following definitions of ``Caretaker 
Status'', ``Marine Transfer Area'', and ``Onshore Facility'' are added 
in alphabetical order and the definitions of ``Facility'', ``Offshore 
Facility'' and ``Transfer'' are revised to read as follows:


Sec. 154.105  Definitions.

* * * * *
    Caretaker Status denotes a facility where all piping, hoses, 
loading arms, storage tanks, and related equipment in the marine 
transfer area are completely free of oil or hazardous materials, where 
these components have been certified as being gas free, where piping, 
hoses, and loading arms terminating near any body of water have been 
blanked, and where the facility operator has notified the COTP that the 
facility will be in caretaker status.
* * * * *
    Facility means either an onshore or offshore facility, except for 
an offshore facility operating under the jurisdiction of the Secretary 
of the Department of Interior, and includes, but is not limited to, 
structure, equipment, and appurtenances thereto, used or capable of 
being used to transfer oil or hazardous materials to or from a vessel 
or public vessel. Also included are facilities that tank clean or strip 
and any floating structure that is used to support an integral part of 
the facility's operation. A facility includes federal, state, 
municipal, and private facilities.
* * * * *
    Marine transfer area means that part of a waterfront facility 
handling oil or hazardous materials in bulk between the vessel, or 
where the vessel moors, and the first manifold or shutoff valve on the 
pipeline encountered after the pipeline enters the secondary 
containment around the bulk storage tank required under 40 CFR 112.7 
inland of the terminal manifold or loading arm, or, in the absence of 
secondary containment, to the valve or manifold adjacent to the bulk 
storage tank, including the entire pier or wharf to which a vessel 
transferring oil or hazardous materials is moored.
* * * * *
    Offshore facility means any facility of any kind located in, on, or 
under, any of the navigable waters of the United States, and any 
facility of any kind which is subject to the jurisdiction of the United 
States and is located in, on, or under any other waters, other than a 
vessel or a public vessel.
* * * * *
    Onshore facility means any facility (including, but not limited to, 
motor vehicles and rolling stock) of any kind located in, on, or under 
any land within the United States other than submerged land.
* * * * *
    Transfer means any movement of oil or hazardous material to, from, 
or within a vessel by means of pumping, gravitation, or displacement. A 
transfer is considered to begin when the person in charge on the 
transferring vessel or facility and the person in charge on the 
receiving facility or vessel first meet to begin completing the 
declaration of inspection as required by Sec. 156.150 of this chapter. 
A transfer is considered to be complete when all the connections for 
the transfer have been uncoupled and secured with blanks or other 
closure devices and both of the persons in charge have completed the 
declaration of inspection to include the date and time the transfer was 
complete.
* * * * *
    4. In Sec. 154.106, paragraphs (a) and (b) and the entries for 
``National Fire Protection Association (NFPA)'' and ``Oil Companies 
International Marine Forum (OCIMF)'' are revised to read as follows:


Sec. 154.106  Incorporation by reference.

    (a) Certain material is incorporated by reference into this part 
with the approval of the Director of the Federal Register in accordance 
with 5 U.S.C. 552(a) and 1 CFR part 51. To enforce any edition other 
than that specified in paragraph (b) of this section, the Coast Guard 
must publish notice of change in the Federal Register and make the 
material available to the public. All approved material is on file at 
the Office of the Federal Register, 800 North Capitol Street NW., suite 
700, Washington, DC and at the U.S. Coast Guard, Office of the 
Compliance (G-MOC), Room 1116, 2100 Second Street SW., Washington, DC 
20593-0001, and is available from the sources indicated in paragraph 
(b) of this section.
    (b) The material approved for incorporation by reference in this 
part and the sections affected are:
* * * * *
National Fire Protection Association (MFPA), 1 Batterymarch Park, 
Quincy, MA 02269-9101

NFPA 51B, Standard for Fire Prevention in Use of Cutting and 
Welding Processes, 1994.........................................154.735
* * * * *
Oil Companies International Marine Forum (OCIMF), 96 Victoria Street, 
15th Floor, London SW1E 5JW, England

International Safety Guide for Oil Tankers and Terminals, Section 
6.10, Fourth Ed., 1996..........................................154.810
International Safety Guide for Oil Tankers and Terminals, 
Sections 9.1, 9.2, 9.3 and 9.5, Fourth Ed., 1996................154.735

    5. Section 154.107 is amended by revising paragraph (b) to read as 
follows:


Sec. 154.107  Alternative.

* * * * *
    (b) The COTP takes final approval or disapproval action on the 
request, submitted in accordance with paragraph (a) of this section, in 
writing within 30 days of receipt of the request.
    6. Section 154.108 is amended by revising paragraphs (a) 
introductory text and (d) to read as follows:


Sec. 154.108   Exemptions.

    (a) The Chief, Marine Safety and Environmental Protection, acting 
for the Commandant, grants an exemption or partial exemption from 
compliance with any requirement in this part if:
 * * * * *
    (d) An exemption is granted or denied in writing. The decision of 
the Chief, Marine Safety and Environmental Protection is a final agency 
action.
    7. In Sec. 154.110, paragraph (b)(1) is revised to read as follows:


Sec. 154.110   Letter of intent.

 * * * * *
    (b) * * *
    (1) The names, addresses, and telephone numbers of the facility 
operator and the facility owner;
 * * * * *

Subpart B--Operations Manual

    8. In Sec. 154.300, paragraphs (a) introductory text, (c), (e) and 
(f) are revised to read as follows (the note following paragraph (b) is 
unchanged):


Sec. 154.300   Operations Manual: General.

    (a) The facility operator of each facility to which this part 
applies shall

[[Page 41459]]

submit, with the letter of intent, two copies of an Operations Manual 
that:
 * * * * *
    (c) The COTP shall examine the Operations Manual when submitted, 
after any substantial amendment, and as otherwise required by the COTP.
 * * * * *
    (e) If the manual meets the requirements of this part and part 156 
of this chapter, the COTP will return one copy of the manual marked 
``Examined by the Coast Guard'' as described in Sec. 154.325.
    (f) The facility operator shall ensure that a sufficient number of 
copies of the examined Operations Manual, including a sufficient number 
of the translations required by paragraph (a)(3) of this section, are 
readily available for each facility person in charge while conducting a 
transfer operation.
 * * * * *
    9. In Sec. 154.310, paragraphs (a)(2), (a)(7), (a)(15), (a)(16) and 
(a)(22) are revised and paragraph (a)(23) is added to read as follows:


Sec. 154.310   Operations manual: Contents.

    (a) * * *
    (2) A physical description of the facility including a plan and/or 
plans, maps, drawings, aerial photographs or diagrams, showing the 
boundaries of the facility subject to Coast Guard jurisdiction, mooring 
areas, transfer locations, control stations, wharfs, the extent and 
scope of the piping subject to the tests required by Sec. 156.170(c)(4) 
of this chapter, and the locations of safety equipment. For mobile 
facilities, a physical description of the facility;
 * * * * *
    (7) The name and telephone number of the qualified individual 
identified under Sec. 154.1026 of this part and the title and/or 
position and telephone number of the Coast Guard, State, local, and 
other personnel who may be called by the employees of the facility in 
an emergency;
 * * * * *
    (15) Quantity, type, location, and instructions for use of fire 
extinguishing equipment required by Sec. 154.735(d) of this part;
    (16) The maximum allowable working pressure (MAWP) of each loading 
arm, transfer pipe system, and hose assembly required to be tested by 
Sec. 156.170 of this chapter, including the maximum relief valve 
setting (or maximum system pressure when relief valves are not 
provided) for each transfer system;
 * * * * *
    (22) Statements explaining that each hazardous materials transfer 
hose is marked with either the name of each product which may be 
transferred through the hose or with letters, numbers, symbols, color 
codes or other system acceptable to the COTP representing all such 
products and the location in the Operations Manual where a chart or 
list of symbols utilized is located and a list of the compatible 
products which may be transferred through the hose can be found for 
consultation before each transfer; and
    (23) For facilities that conduct tank cleaning or stripping 
operations, a description of their procedures.
 * * * * *
    10. In Sec. 154.320, paragraphs (a)(1) and (d) are revised to read 
as follows:


Sec. 154.320   Operations manual: Amendment.

    (a) * * *
    (1) The COTP will notify the facility operator in writing of any 
inadequacies in the Operations Manual. The facility operator may submit 
written information, views, and arguments regarding the inadequacies 
identified, and proposals for amending the Manual, within 45 days from 
the date of the COTP notice. After considering all relevant material 
presented, the COTP shall notify the facility operator of any amendment 
required or adopted, or the COTP shall rescind the notice. The 
amendment becomes effective 60 days after the facility operator 
receives the notice, unless the facility operator petitions the 
Commandant to review the COTP's notice, in which case its effective 
date is delayed pending a decision by the Commandant. Petitions to the 
Commandant must be submitted in writing via the COTP who issued the 
requirement to amend the Operations Manual.
 * * * * *
    (d) Amendments to personnel and telephone number lists required by 
Sec. 154.310(a)(7) of this part do not require examination by the COTP, 
but the COTP must be advised of such amendments as they occur.
    11. Section 154.325 is revised to read as follows:


Sec. 154.325  Operations Manual: Procedures for examination.

    (a) The operator of a facility shall submit two copies of the 
Operations Manual to the Captain of the Port of the zone in which the 
facility is located.
    (b) Not less than 60 days prior to any transfer operation, the 
operator of a new facility shall submit, with the letter of intent, two 
copies of the Operations Manual to the Captain of the Port of the zone 
in which the facility is located.
    (c) After a facility is removed from caretaker status, not less 
than 30 days prior to any transfer operation the operator of that 
facility shall submit two copies of the Operations Manual to the COTP 
of the zone in which the facility is located unless the manual has been 
previously examined and no changes have been made since the 
examination.
    (d) If the COTP finds that the Operations Manual meets the 
requirements of this part and part 156 of this chapter, the COTP will 
return one copy of the manual to the operator marked ``Examined by the 
Coast Guard''.
    (e) If the COTP finds that the Operations Manual does not meet the 
requirements of this part and/or part 156 of this chapter, the COTP 
will return the manuals with an explanation of why it does not meet the 
requirements of this chapter.
    (f) No person may use any Operations Manual for transfer operations 
as required by this chapter unless the Operations Manual has been 
examined by the COTP.
    (g) The Operations Manual is voided if the facility operator--
    (1) Amends the Operations Manual without following the procedures 
in Sec. 154.320 of this part;
    (2) Fails to amend the Operations Manual when required by the COTP; 
or
    (3) Notifies the COTP in writing that the facility will be placed 
in caretaker status.

Subpart C--Equipment Requirements

    12. In Sec. 154.500, paragraphs (a) and (b) are revised to read as 
follows:


Sec. 154.500  Hose assemblies.

* * * * *
    (a) The minimum design burst pressure for each hose assembly must 
be at least four times the sum of the pressure of the relief valve 
setting (or four times the maximum pump pressure when no relief valve 
is installed) plus the static head pressure of the transfer system, at 
the point where the hose is installed.
    (b) The maximum allowable working pressure (MAWP) for each hose 
assembly must be more than the sum of the pressure of the relief valve 
setting (or the maximum pump pressure when no relief valve is 
installed) plus the static head pressure of the transfer system, at the 
point where the hose is installed.
* * * * *
    13. Section 154.520 is revised to read as follows:


Sec. 154.520  Closure devices.

    (a) Except as provided in paragraph (b) of this section, each 
facility to which

[[Page 41460]]

this part applies must have enough butterfly valves, wafer-type 
resilient seated valves, blank flanges, or other means acceptable to 
the COTP to blank off the ends of each hose or loading arm that is not 
connected for the transfer of oil or hazardous material. Such hoses 
and/or loading arms must be blanked off during the transfer of oil or 
hazardous material. A suitable material in the joints and couplings 
shall be installed on each end of the hose assembly or loading arm not 
being used for transfer to ensure a leak-free seal.
    (b) A new, unused hose, and a hose that has been cleaned and is gas 
free, is exempt from the requirements of paragraph (a) of this section.
    14. In Sec. 154.530, paragraph (a) is revised and paragraph (e) is 
added to read as follows:


Sec. 154.530  Small discharge containment.

    (a) Except as provided in paragraphs (c), (d), and (e) of this 
section, each facility to which this part applies must have fixed 
catchments, curbing, or other fixed means to contain oil or hazardous 
material discharged in at least--
    (1) Each hose handling and loading arm area (that area on the 
facility that is within the area traversed by the free end of the hose 
or loading arm when moved from its normal stowed or idle position into 
a position for connection);
    (2) Each hose connection manifold area; and
    (3) Under each hose connection that will be coupled or uncoupled as 
part of the transfer operation during coupling, uncoupling, and 
transfer.
* * * * *
    (e) Fixed or portable containment may be used to meet the 
requirements of paragraph (a)(3) of this section.
    15. Section 154.540 is revised to read as follows:


Sec. 154.540  Discharge removal.

    Each facility to which this part applies must have a means to 
safely remove discharged oil or hazardous material, within one hour of 
completion of the transfer, from the containment required by 
Sec. 154.530 of this part without discharging the oil or hazardous 
material into the water.
    16. In Sec. 154.545, paragraph (e) is added to read as follows:


Sec. 154.545  Discharge containment equipment.

* * * * *
    (e) Equipment and procedures maintained to satisfy the provisions 
of this chapter may be utilized in the planning requirements of subpart 
F of this part.
    17. In Sec. 154.560, paragraph (e) is revised to read as follows:


Sec. 154.560  Communications.

* * * * *
    (e) Portable radio devices used to comply with paragraph (a) of 
this section during the transfer of flammable or combustible liquids 
must be marked as intrinsically safe by the manufacturer of the device 
and certified as intrinsically safe by a national testing laboratory or 
other certification organization approved by the Commandant as defined 
in 46 CFR 111.105-11. As an alternative to the marking requirement, 
facility operators may maintain documentation at the facility 
certifying that the portable radio devices in use at the facility are 
in compliance with this section. Subpart D--Facility Operations.
    18. In Sec. 154.710, paragraphs (b), (c), (d) introductory text, 
(d)(7) and (d)(8) are revised and paragraph (e) is added to read as 
follows:


Sec. 154.710  Persons in charge: Designation and qualification.

* * * * *
    (b) The person has had at least 48 hours of experience in transfer 
operations at a facility in operations to which this part applies. The 
person also has enough experience at the facility for which 
qualification is desired to enable the facility operator to determine 
that the person's experience is adequate;
    (c) The person has completed a training and qualification program 
established by the facility operator and described in the Operations 
Manual in accordance with Sec. 154.310(a)(21), that provides the person 
with the knowledge and training necessary to properly operate the 
transfer equipment at the facility, perform the duties described in 
paragraph (d) of this section, follow the procedures required by this 
part, and fulfill the duties required of a person in charge during an 
emergency, except that the COTP may approve alternative experience and 
training requirements for new facilities; and
    (d) The facility operator must certify that each person in charge 
has the knowledge of, and skills necessary to--
* * * * *
    (7) Follow local discharge reporting procedures; and
    (8) Carry out the facility's response plan for discharge reporting 
and containment.
    (e) Training conducted to comply with the hazard communication 
programs required by the Occupational Safety and Health Administration 
(OSHA) of the Department of Labor (DOL) (29 CFR 1910.1200) or the 
Environmental Protection Agency (EPA) (40 CFR 311.1), or to meet the 
requirements of subpart F of this part may be used to satisfy the 
requirements in paragraphs (c) and (d) of this section, as long as the 
training addresses the requirements in paragraphs (c) and (d) of this 
section.
    19. In Sec. 154.735, the introductory text, paragraphs (l) and (s) 
through (t) are revised and paragraphs (u) through (v) are added to 
read as follows:


Sec. 154.735  Safety requirements.

    Each operator of a facility to which this part applies shall ensure 
that the following safety requirements are met at the facility:
* * * * *
    (l) All welding or hot work conducted on or at the facility is the 
responsibility of the facility operator. The COTP may require that the 
operator of the facility notify the COTP before any welding or hot work 
operations are conducted. Any welding or hot work operations conducted 
on or at the facility must be conducted in accordance with NFPA 51B. 
The facility operator shall ensure that the following additional 
conditions or criteria are met:
    (1) Welding or hot work is prohibited during gas freeing 
operations, within 30.5 meters (100 feet) of bulk cargo operations 
involving flammable or combustible materials, within 30.5 meters (100 
feet) of fueling operations, or within 30.5 meters (100 feet) of 
explosives or 15.25 meters (50 feet) of other hazardous materials.
    (2) If the welding or hot work is on the boundary of a compartment 
(i.e., bulkhead, wall or deck) an additional fire watch shall be 
stationed in the adjoining compartment.
    (3) Personnel on fire watch shall have no other duties except to 
watch for the presence of fire and to prevent the development of 
hazardous conditions.
    (4) Flammable vapors, liquids or solids must first be completely 
removed from any container, pipe or transfer line subject to welding or 
hot work.
    (5) Tanks used for storage of flammable or combustible substances 
must be tested and certified gas free prior to starting hot work.
    (6) Proper safety precautions in relation to purging, inserting, or 
venting shall be followed for hot work on containers;
    (7) All local laws and ordinances shall be observed;
    (8) In case of fire or other hazard, all cutting, welding or other 
hot work equipment shall be completely secured.
 * * * * *
    (s) Tank cleaning or gas freeing operations conducted by the 
facility on vessels carrying oil residues or mixtures shall be 
conducted in accordance with

[[Page 41461]]

sections 9.1, 9.2, 9.3, and 9.5 of the OCIMF International Safety Guide 
for Oil Tankers and Terminals (ISGOTT), except that--
    (1) Prohibitions in ISGOTT against the use of recirculated wash 
water do not apply if the wash water is first processed to remove 
product residues;
    (2) The provision in ISGOTT section 9.2.10 concerning flushing the 
bottom of tanks after every discharge of leaded gasoline does not 
apply;
    (3) The provision in ISGOTT section 9.2.11 concerning that removal 
of sludge, scale, and sediment does not apply if personnel use 
breathing apparatus which protect them from the tank atmosphere; and
    (4) Upon the request of the facility owner or operator in 
accordance with Sec. 154.107, the COTP may approve the use of 
alternative standards to ISGOTT if the COTP determines that the 
alternative standards provide an equal level of protection to the 
ISGOTT standards.
    (t) Guards are stationed, or equivalent controls acceptable to the 
COTP are used to detect fires, report emergency conditions, and ensure 
that access to the marine transfer area is limited to--
    (1) Personnel who work at the facility including persons assigned 
for transfer operations, vessel personnel, and delivery and service 
personnel in the course of their business;
    (2) Coast Guard personnel;
    (3) Other Federal, State, or local governmental officials; and
    (4) Other persons authorized by the operator.
    (u) Smoking shall be prohibited at the facility except that 
facility owners or operators may authorize smoking in designated areas 
if--
    (1) Smoking areas are designated in accordance with local 
ordinances and regulations;
    (2) Signs are conspicuously posted marking such authorized smoking 
areas; and
    (3) ``No Smoking'' signs are conspicuously posted elsewhere on the 
facility.
    (v) Warning signs shall be displayed on the facility at each 
shoreside entry to the dock or berth, without obstruction, at all times 
for fixed facilities and for mobile facilities during coupling, 
transfer operation, and uncoupling. The warning signs shall conform to 
46 CFR 151.45-2(e)(1) or 46 CFR 153.955.
    20. In Sec. 154.740, the introductory text and paragraph (b) are 
revised and paragraph (j) is added to read as follows:


Sec. 154.740   Records.

    Each facility operator shall maintain at the facility and make 
available for examination by the COTP:
 * * * * *
    (b) The name of each person designated as a person in charge of 
transfer operations at the facility and certification that each person 
in charge has completed the training requirements of Sec. 154.710 of 
this part;
 * * * * *
    (j) If they are not marked as such, documentation that the portable 
radio devices in use at the facility under Sec. 154.560 of this part 
are intrinsically safe.

PART 156--OIL AND HAZARDOUS MATERIAL TRANSFER OPERATIONS

    21. The authority citation for part 156 continues to read as 
follows:

    Authority: 33 U.S.C. 1231, 1321(j)(1) (C) and (D); 46 U.S.C. 
3715; E.O. 12777, 56 FR 54757, 3 CFR, 1991 Comp., p. 351, 49 CFR 
1.46. Section 156.120(bb) is issued under the authority of section 
4110, Pub. L. 101-380, 104 Stat. 515.

Subpart A--Oil and Hazardous Materials Transfer Operations

    22. Section 156.110 is amended by revising paragraphs (a) 
introductory text and (d) to read as follows:


Sec. 156.110   Exemptions.

    (a) The Chief, Marine Safety and Environmental Protection, acting 
for the Commandant, may grant an exemption or partial exemption from 
compliance with any requirement in this part, and the District 
Commander may grant an exemption or partial exemption from compliance 
with any operating condition or requirement in subpart C of this part, 
if:
* * * * *
    (d) An exemption is granted or denied in writing. The decision of 
the Chief, Marine Safety and Environmental Protection is a final agency 
action.
    23. In Sec. 156.120, the introductory text and paragraphs (f) and 
(w)(5) are revised and paragraphs (cc) and (dd) are added to read as 
follows:


Sec. 156.120   Requirements for transfer.

    A transfer is considered to begin when the person in charge on the 
transferring vessel or facility and the person in charge on the 
receiving facility or vessel first meet to begin completing the 
declaration of inspection, as required by Sec. 156.150 of this part. No 
person shall conduct an oil or hazardous material transfer operation 
unless:
* * * * *
    (f) The end of each hose and loading arm that is not connected for 
the transfer of oil or hazardous material is blanked off using the 
closure devices required by Secs. 154.520 and 155.805 of this chapter;
* * * * *
    (w) * * *
    (5) Details of the transferring and receiving systems including 
procedures to ensure that the transfer pressure does not exceed the 
maximum allowable working pressure (MAWP) for each hose assembly, 
loading arm and/or transfer pipe system;
* * * * *
    (cc) Smoking is not permitted in the facilities marine transfer 
area except in designated smoking areas.
    (dd) Welding, hot work operations and smoking are prohibited on 
vessels during the transfer of flammable or combustible materials, 
except that smoking may be permitted in accommodation areas designated 
by the master.
    24. In Sec. 156.150, paragraphs (c)(3) and (c)(5) are revised and 
paragraph (c)(6) is added to read as follows:


Sec. 156.150   Declaration of inspection.

* * * * *
    (c) * * *
    (3) The date and time the transfer operation is started;
* * * * *
    (5) A space for the date, time of signing, signature, and title of 
each person in charge during transfer operations on the transferring 
vessel or facility and a space for the date, time of signing, 
signature, and title of each person in charge during transfer 
operations on the receiving facility or vessel certifying that all 
tests and inspections have been completed and that they are both ready 
to begin transferring product; and
    (6) The date and time the transfer operation is completed.
* * * * *
    25. In Sec. 156.170, paragraphs (c)(1)(i), (c)(1)(iv) and (f)(1) 
are revised, paragraph (f)(2) is revised and redesignated as (f)(3) and 
paragraphs (f)(2) and (h) are added to read as follows:


Sec. 156.170   Equipment tests and inspections.

* * * * *
    (c) * * *
    (1) * * *
    (i) Have no unrepaired loose covers, kinks, bulges, soft spots or 
any other defect which would permit the discharge of oil or hazardous 
material through the hose material, and no

[[Page 41462]]

gouges, cuts or slashes that penetrate the first layer of hose 
reinforcement as defined in Sec. 156.120(i).
* * * * *
    (iv) Hoses not meeting the requirements of paragraph (c)(1)(i) of 
this section may be acceptable after a static liquid pressure test is 
successfully completed in the presence of the COTP. The test medium is 
not required to be water.
* * * * *
    (f) * * *
    (1) For facilities, annually or not less than 30 days prior to the 
first transfer conducted past one year from the date of the last tests 
and inspections;
    (2) For a facility in caretaker status, not less than 30 days prior 
to the first transfer after the facility is removed from caretaker 
status; and
    (3) For vessels, annually or as part of the biennial and mid-period 
inspections.
* * * * *
    (h) Upon the request of the owner or operator, the COTP may approve 
alternative methods of compliance to the testing requirements of 
paragraph (c) of this section if the COTP determines that the 
alternative methods provide an equal level of protection.

    Dated: July 30, 1996.
J.C. Card,
U.S. Coast Guard, Chief, Marine Safety and Environmental Protection.
[FR Doc. 96-20020 Filed 8-7-96; 8:45 am]
BILLING CODE 4910-14-M