[Federal Register Volume 69, Number 157 (Monday, August 16, 2004)]
[Notices]
[Pages 50438-50442]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-18706]


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DEPARTMENT OF TRANSPORTATION

Research and Special Programs Administration

[Docket No. RSPA-04-18858; Notice 1]


Pipeline Safety: Intent To Consider Waiver for Duke Energy Gas 
Transmission Company

AGENCY: Research and Special Programs Administration (RSPA), Department 
of Transportation (DOT).

ACTION: Notice of intent to consider waiver request.

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SUMMARY: Duke Energy Gas Transmission Company (DEGT)

[[Page 50439]]

petitioned the Research and Special Programs Administration's Office of 
Pipeline Safety (RSPA/OPS) for waiver of compliance with 192.611 for 
locations changing from Class 1 to Class 2 along certain natural gas 
pipeline segments in Tennessee and Kentucky pursuant to its 
participation in the Risk Management Demonstration Program. In the 
absence of a waiver, 192.611 requires gas pipeline operators to confirm 
or revise the maximum allowable operating pressure of a pipeline after 
an increase in the population of an area along a pipeline's route 
results in a change to a higher class location. In lieu of compliance 
with 192.611, DEGT proposed to conduct a set of alternative risk 
control activities based on the principles and requirements of the 
Integrity Management Program on the entire length of the affected 
pipeline segments. RSPA/OPS is considering whether to grant a waiver 
and seeks public comment on the proposed waiver.

ADDRESSES: Any comments to this Notice must be submitted on or before 
September 15, 2004 so they can be considered before a final 
determination is made on whether to grant the waiver. You may submit 
written comments (identified by DOT DMS Docket Number RSPA-00-8452) 
directly to the docket by any of the following methods:
     Web site: Go to http://dms.dot.gov. Follow instructions 
for submitting comments on the DOT electronic docket site.
     Fax: 1-202-493-2251.
     Mail: Docket Management Facility, U.S. Department of 
Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, 
Washington, DC 20590-0001. Anyone wanting confirmation of mailed 
comments must include a self-addressed stamped postcard.
     Hand delivery or courier: Room PL-401 on the plaza level 
of the Nassif Building, 400 Seventh Street, SW., Washington, DC between 
10 a.m. and 5 p.m., Monday through Friday, except Federal holidays.
    All submissions must include the agency name, docket number and 
notice number stated in the heading of this notice. Note that all 
comments received will be posted without change, including any personal 
information provided. Please see the Privacy Act heading below.
    Docket access: For copies of this notice or other material in the 
dockets, you may contact the Dockets Facility by phone (202-366-9329) 
or visit the facility at the above street address. For Web access to 
the dockets to read and download filed material, go to http://dms.dot.gov/search. Then type in the last four digits of the docket 
number shown in the heading of this notice, and click on ``Search.''
    Privacy Act Information: Anyone can search the electronic form of 
all comments filed in any of our dockets by the name of the individual 
submitting the comment (or signing the comment, if submitted for an 
association, business, labor union, etc.). You may review DOT's 
complete Privacy Act Statement in the April 11, 2000, issue of the 
Federal Register (65 FR 19477) or go to http://dms.dot.gov.

FOR FURTHER INFORMATION CONTACT: Elizabeth Callsen, RSPA/OPS, (202) 
366-4572, regarding the subject matter of this Notice. Contact the 
Dockets Unit, (202) 366-5046, for docket material. Comments may also be 
reviewed online at the DOT Dockets Management System website at http://dms.dot.gov/.

SUPPLEMENTARY INFORMATION:

Background

    Under 192.5, the geographic areas along natural gas pipelines are 
categorized according to the population densities near the pipelines. 
Areas with the lowest population density (10 or fewer buildings 
intended for human occupancy within an area that extends 220 yards on 
either side of the centerline of any continuous one mile length of 
pipeline) are designated as Class 1 and areas with the highest 
population density are designated as Class 4. The pipeline safety 
regulations generally impose more stringent requirements for pipeline 
design and operation for line sections in the higher class areas. Under 
192.611, when the class designation of a particular location changes to 
a higher class due to new construction in the vicinity of the pipeline, 
the pipeline operator must reduce the operating pressure, pressure test 
the pipe, or replace the pipe.
    In accordance with Section 5 of The Accountable Pipeline Safety and 
Partnership Act of 1996 (Pub. L. 104-304, 110 Stat. 3793; October 12, 
1996), RSPA/OPS established the Risk Management Demonstration Program 
(RMDP) in partnership with operators of natural gas and liquid pipeline 
facilities to determine how risk management principles could be used to 
complement and improve the existing Federal pipeline safety regulatory 
process. Under the RMDP, pipeline operators proposed risk management 
projects to demonstrate how a structured and formalized risk management 
process could enable a company to customize its safety program to 
allocate resources to its pipeline's particular risks, leading to a 
superior level of safety and environmental protection. DEGT and eleven 
other pipeline companies were selected as potential candidates for RMDP 
projects (see Candidates for the Pipeline Risk Management Demonstration 
Program [62 FR 143; July 25, 1997]; Pipeline Safety: Remaining 
Candidates for the Pipeline Risk Management Demonstration Program (62 
FR 197; October 10, 1997).
    In evaluating DEGT as a RMDP candidate, RSPA/OPS and DEGT engaged 
in a consultation process to scrutinize DEGT's safety practices and 
pipeline risk management program. DEGT identified twenty-one (21) sites 
where the class location had changed from Class 1 to Class 2 along the 
route of two compressor station discharges (i.e., the pipeline 
beginning at the discharge of those compressor stations and continuing 
downstream until the next compressor station), one of which is located 
in Tennessee and the other in Kentucky.
    By letter dated October 5, 2000, DEGT petitioned RSPA/OPS for 
waiver of compliance with 192.611 for class location changes affecting 
the pipe segments in the two compressor station discharges pursuant to 
its participation in the RMDP. DEGT proposed to conduct certain 
alternative risk control activities, including internal inspections, on 
all of the pipeline segments in the two compressor station discharges 
in lieu of compliance with the requirements of 192.611 and demonstrated 
that the alternative risk control activities would provide a level of 
safety comparable to that provided by compliance with 192.611. The 
requested waiver was intended to extend through the remainder of the 
consultation period and to expire upon final action under the RMDP.
    On December 11, 2000, RSPA/OPS published a notice in the Federal 
Register seeking comment on the waiver (65 FR 77419; December 11, 
2000). No comments were received in response to the notice. On March 9, 
2001, RSPA/OPS granted the waiver with respect to the compressor 
station discharge in Tennessee containing 15 of the 21 sites where the 
class location had changed from Class 1 to Class 2 while approval of 
DEGT's RMDP project was pending (66 FR 14256; March 9, 2001). Based in 
part on the knowledge and experience with risk management gained in 
connection with DEGT's RMDP project, on December 15, 2003, RSPA/OPS 
issued its Integrity Management Program regulations requiring gas 
pipeline operators to conduct comprehensive assessments of their 
systems and perform any remedial

[[Page 50440]]

actions necessary in high consequence areas such as populated areas and 
environmentally sensitive areas (49 CFR Part 192, Subpart O).
    By letter dated June 1, 2004, DEGT submitted a petition for waiver 
of 192.611 that would apply to all 21 of the sites where the class 
location had changed from Class 1 to Class 2, including those in 
Kentucky. DEGT further requested that the waiver be applicable to any 
Class 1 pipe that should change to Class 2 in the future anywhere in 
the two compressor station discharges. DEGT's petition for waiver 
amounts to a request that the waiver granted on March 9, 2001, be 
extended to all of the pipeline segments in both compressor station 
discharges and be made permanent, constituting final action under the 
RMDP.

DEGT's Waiver Request

    DEGT's waiver request involves three parallel pipelines in its 
Texas Eastern Pipeline system designated as Line 10, Line 15, and Line 
25. More specifically, the request involves: (1) All three line 
segments running downstream of the Mt. Pleasant, TN, compressor station 
discharge, each for a distance of approximately 63.6 miles; and (2) all 
three line segments running downstream of the Owingsville, KY, 
compressor station discharge, each for a distance of approximately 60.5 
miles (collectively, the ``waiver segments''). Within the waiver 
segments are the 21 sites already identified as having changed from 
Class 1 to Class 2 (the ``Class Change Sites''). The following table 
shows the waiver segments and the class change sites within each 
segment:

    Pipeline Segments Changing From Class 1 to Class 2 That Would Be
               Immediately Affected by the Proposed Waiver
------------------------------------------------------------------------
                                                   Begin         End
   Site No.       County & state   Line number    milepost     milepost
------------------------------------------------------------------------
                     Mt. Pleasant Station Discharge
------------------------------------------------------------------------
1.............  Maury Co.,                  10       226.88       227.35
                 Tennessee.                 15       226.90       227.50
                                            25       227.05       227.50
2.............  Maury Co.,                  10       228.49       229.07
                 Tennessee.                 15       228.65       229.21
                                            25       228.63       229.22
3.............  Maury Co.,                  10       238.01       239.19
                 Tennessee.                 15       238.17       239.34
                                            25       238.17       239.36
3A............  Maury Co.,                  25       241.69       241.72
                 Tennessee.
4.............  Maury Co.,                  10       247.79       247.88
                 Tennessee.                 15       247.94       248.04
                                            25       247.94       248.03
5.............  Williamson Co.,             10       264.03       265.31
                 Tennessee.                 15       264.19       265.49
                                            25       264.24       265.48
---------------
                      Owingsville Station Discharge
------------------------------------------------------------------------
6.............  Fleming Co.,                10       514.78       514.98
                 Kentucky.                  25       515.25       515.28
7.............  Lewis Co.,                  10       531.10       533.33
                 Kentucky.                  15       531.54       533.75
                                            25       531.54       533.76
------------------------------------------------------------------------

    DEGT recently re-evaluated the class designations on the waiver 
segments using a referencing system (i.e., milepost designations) 
unique to each of the three pipelines rather than the more generic 
milestones applicable to the right-of-way and used in the RMDP 
discussions. DEGT determined that no class location change had actually 
occurred at one of the 21 class change sites, reducing the number of 
class change sites to 20. However, DEGT also identified one additional 
site along one of the waiver segments that had changed from Class 1 to 
Class 2, bringing the total number of class change sites back to 21. 
The 21 sites described in the above table are the results of DEGT's re-
evaluation.
    RSPA/OPS is considering granting the waiver for the following 
reasons:
     As a candidate for a RMDP project, DEGT participated in a 
consultation process with RSPA/OPS which included an enhanced sharing 
of information related to the integrity of DEGT's pipelines. DEGT's 
risk management practices and alternative risk control activities 
continue to focus on the risks identified by DEGT as the most important 
threats to the integrity of its system.
     DEGT has internally inspected the entire length of all 
waiver segments, a total of nearly 375 miles of pipeline including all 
pipe located in the 21 class change sites.
     The resources saved by not replacing the pipe in the class 
change sites will allow DEGT to assess the integrity of additional 
portions of its system, reducing the overall risks along the DEGT 
pipeline system. The alternative risk control activities add protection 
against pipeline failures from corrosion, manufacturing and 
construction defects, and outside third-party damage along the full 373 
miles of the waiver segments. By way of contrast, compliance with 
192.611 would require replacement of pipe or re-qualification tests in 
only the 17 miles of pipe located at the class change sites, with no 
added protection for the remaining 356 miles of pipe.

The Alternative Risk Control Activities

    Consistent with the agreements reached under the RMDP, DEGT 
implemented the following alternative risk control activities in lieu 
of compliance with 192.611:

[[Page 50441]]

     Conduct internal inspections on the entire length of the 
waiver segments using geometry and magnetic flux leakage in-line 
inspection tools. These tools must be capable of identifying 
indications of wall loss (e.g. corrosion), as well as dents and gouges 
from initial construction damage or damage from third party excavators 
working along the pipeline right-of-way. Internal inspections of Lines 
10, 15, and 25 in the Mt. Pleasant, TN compressor station discharge 
covering approximately 190 miles of pipe and internal inspections of 
Lines 10, 15, and 25 in the Owingsville, KY compressor station 
discharge covering approximately 185 miles of pipe have been performed 
and the OPS Southern Region has reviewed the inspection results.
     Repair indications of corrosion, existing construction 
damage, and existing outside force damage identified by the internal 
inspection using conservative investigation and repair criteria. The 
criteria used by DEGT calls for investigation and repairs of small 
dents and anomalies that are well below the size at which a challenge 
to pipeline integrity might be expected.
     Hydrostatic tests on portions of Line 10 that had 
previously not been tested to 100 percent of SMYS. This includes two 
sites in Tennessee (2.5 miles northwest of Rally Hill in Maury County 
and 3.5 miles east-northeast of Arrington in Williamson County) and one 
site in Kentucky (4.4 miles southeast of Kinniconick in Lewis County). 
This hydrostatic testing has been completed and the OPS Southern Region 
has reviewed the results.
     Perform enhanced third-party damage prevention activities. 
Damage caused by excavators near the pipeline represents one of the 
highest risks to the pipe in the class location change sites. This 
damage prevention program included installation, for a one-year trial 
period, of the TransWave monitoring system on the full length of 
pipeline within the Mt. Pleasant discharge (63.6 miles on each line). 
The TransWave system monitors the waveform of a small current impressed 
onto the pipeline for changes, such as might be caused by disturbances 
created by excavation or other third-party activities. It was tested to 
determine its reliability and usefulness at detecting third-party 
encroachments (construction, excavation, etc.) in the pipeline right-
of-way. The trial period for testing the TransWave system has been 
completed and a final report of this trial has been submitted to RSPA/
OPS.
     Conduct future inspections on the waiver segments and 
remediation of any defects identified in accordance with Subpart O of 
Part 192.
    Representatives from OPS Headquarters, OPS Southern and Eastern 
Regions, and the Tennessee Regulatory Authority, meeting as a RMDP 
Project Review Team, evaluated DEGT's alternative risk control 
activities. The Project Review Team met with DEGT to discuss the risk 
assessment and risk control processes DEGT uses, how these processes 
were used to identify and define the activities, and DEGT's analysis of 
the protection achieved by the activities compared to the protection 
192.611 provides. The analysis also included an environmental 
assessment. It is the preliminary opinion of OPS that the 
implementation of the alternative risk control activities on the waiver 
segments has resulted in a margin of safety and environmental 
protection comparable to that provided through compliance with 192.611.

RSPA/OPS' Proposed Action

    RSPA/OPS is considering granting the proposed waiver. If granted, 
the waiver would be conditioned on the following:
    1. DEGT must ensure full implementation of the alternative risk 
control activities.
    2. DEGT must verify that the technical criteria presented to the 
PRT, or other criteria for class location waivers which RSPA/OPS may 
approve in the future, are met for any future class change sites within 
the waiver segments that might change from Class 1 to Class 2.
    3. DEGT must provide prior notice to RSPA/OPS of its intention to 
rely upon this waiver, rather than replacing pipe, in any application 
to future class change sites so that RSPA/OPS can independently verify 
that the criteria have been met.
    4. DEGT must monitor the effectiveness of the alternative risk 
control activities and submit ongoing reports to RSPA/OPS.
    5. DEGT must conduct an inspection of Line 15 in the Owingsville 
discharge using an in-line inspection tool designed to detect the 
condition(s) that caused or contributed to the November 2, 2003, 
release on Line 15 upstream of Owingsville including hard spots. (Note: 
This accident location is not within the waiver segments, but the 
waiver segments include pipe of similar materials and construction. 
DEGT's investigation of the accident has concluded that it resulted 
from hydrogen cracking where a lamination (an area within the pipe wall 
where the material was not fully fused together) and a hard spot (an 
area where the metallurgical properties of the pipe are altered due to 
localized rapid cooling in a manner that would make cracking more 
likely) coincided. Line 15 within the Owingsville discharge contains 
pipe from the same manufacturer and vintage as the pipe that failed in 
the 2003 accident. DEGT has agreed to conduct an inspection from the 
same manufacturer and vintage as the pipe that failed in the 2003 
accident. DEGT has agreed to conduct an inspection of Line 15 in the 
Owingsville discharge using an in-line inspection tool designed to 
detect hard spots.)
    6. DEGT must investigate and remediate all hard spots detected 
pursuant to Item 5 as necessary. Make the results of the investigation 
and any remediation activities available to RSPA/OPS.
    7. DEGT must conduct additional public information activities in 
the populated areas along the waiver segments, providing information to 
local emergency response personnel/agencies about the operation of the 
pipeline, the possibility of accidents, and actions that must be taken 
in the event of an accident on the pipeline.
    8. Within three months following approval of this waiver and 
annually thereafter, DEGT will be required to report the following:
     The economic benefit to the company. This will be required 
to address both the cost avoided from not replacing the pipe as well as 
the added costs of the inspection program (required for the initial 
report only).
     The results of any ILI or direct assessments performed 
within the inspection area containing the waiver location(s) during the 
previous year.
     Any new integrity threats identified within the inspection 
area containing the waiver location(s) during the previous year.
     Any encroachment in the inspection area including the 
waiver location(s) including the number of new residences or gathering 
areas.
     Any incidents associated with the inspection area 
containing the waiver location(s) that occurred during the previous 
year (both reportable and non reportable).
     Any leaks on the pipeline in the inspection area 
containing the waiver location(s) that occurred during the previous 
year (both reportable and non reportable).
     List of all repairs on the pipeline in the waiver 
location(s) made during the previous year.
     On-going damage prevention initiatives on the pipeline in 
the inspection area containing the waiver location(s) and a discussion 
on their success.

[[Page 50442]]

     Any mergers, acquisitions, transfers of assets, or other 
events affecting the regulatory responsibility of the company operating 
the pipeline to which the waiver applies.
     To the extent possible, DEGT's first annual report will be 
required to describe the benefit of this waiver to the public in terms 
of energy availability. Availability should address the benefit of 
avoided disruptions required for pipe replacement and the benefit of 
maintaining system capacity.
    After RSPA/OPS has considered any comments received in response to 
this notice, we will make a final determination on whether to grant a 
waiver to DEGT. If a waiver is granted and RSPA/OPS subsequently 
determines that the terms of the waiver are no longer appropriate or 
that the overall effect of the waiver is inconsistent with pipeline 
safety, RSPA/OPS retains its authority to revoke the waiver and require 
DEGT to immediately comply with 192.611 and all other applicable 
regulations. This Notice is RSPA/OPS' final request for public comment 
before we make a final decision on whether to grant the waiver.

    Authority: 49 U.S.C. 60118(c); 49 CFR 1.53.

    Issued in Washington, DC, on August 10, 2004.
Christopher J. Hoidal,
Acting Deputy Associate Administrator for Pipeline Safety.
[FR Doc. 04-18706 Filed 8-13-04; 8:45 am]
BILLING CODE 4910-60-P