[Federal Register Volume 71, Number 132 (Tuesday, July 11, 2006)]
[Notices]
[Pages 39148-39151]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-6107]


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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

[Docket No. PHMSA-2006-23448; Notice 2]


Pipeline Safety: Grant of Waiver; Maritimes & Northeast Pipeline, 
L.L.C.

AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA); 
DOT.

ACTION: Grant of waiver.

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SUMMARY: PHMSA is granting Maritimes & Northeast Pipeline, L.L.C. (M&N) 
a waiver of compliance from certain PHMSA regulations for the United 
States portion of its pipeline system. This waiver increases the 
maximum allowable operating pressure (MAOP) for the pipeline. This 
waiver decision also authorizes M&N to increase the design factor for 
its compressor station piping, grants relief from the strength testing 
requirements for M&N's compressor station piping, grants relief in 
establishing the MAOP of pipelines operating above prescribed hoop 
stresses, grants relief from the capacity requirements of pressure 
limiting stations, and authorizes M&N to maintain the pressure rating 
of portions of the waiver area subject to a change in class location.
    Before granting the waiver, PHMSA performed a thorough technical 
review of M&N's application and supporting documents. PHMSA requested 
and received supplementary information on numerous technical aspects of 
M&N's design, engineering, operations, and maintenance practices. The 
materials are available in docket PHMSA-2006-23448 at http://dms.dot.gov. PHMSA also sought comments from the public and received 
positive feedback from States along the pipeline and the Technical 
Pipeline Safety Standards Committee.
    The waiver is subject to and conditional upon supplemental safety 
criteria set forth in this notice. The supplemental safety criteria 
address the life-cycle management of the subject pipeline and require 
M&N to adhere to maintenance, inspection, monitoring, control, and 
reporting standards exceeding existing regulatory requirements.

SUPPLEMENTARY INFORMATION: 

Background

    M&N requested a waiver of compliance for the United States portion 
of its pipeline system in Class 1, 2, and 3 locations to operate at 
stress levels up to 80 percent, 67 percent, and 56 percent, 
respectively, of the pipeline's specified minimum yield strength 
(SMYS). The current MAOP of the pipeline system is 1,440 pounds per 
square inch gauge (psig) and the waiver would increase it to 1,600 
psig. Specifically, M&N requests a waiver of compliance from the 
following regulatory requirements:
     49 CFR 192.111--Design factor (F) for steel pipe;

[[Page 39149]]

     49 CFR 192.201--Required capacity of pressure relieving 
and limiting stations;
     49 CFR 192.503--General Requirements;
     49 CFR 192.611--Change in class location: Confirmation or 
revision of maximum allowable operating pressure; and
     49 CFR 192.619--Maximum allowable operating pressure: 
Steel or plastic pipelines.
    The proposed waiver applies to approximately 203 miles of M&N's 24-
inch diameter pipeline. This portion of pipeline extends from M&N's 
Baileyville, Maine compressor station near the United States/Canadian 
border to Westbrook, Maine, and includes two compressor stations.
    The proposed waiver also applies to approximately 100 miles of 30-
inch diameter pipeline. This portion of pipeline is owned jointly in 
undivided interest by M&N and Portland Natural Gas Transmission System 
(PNGTS) and is referred to as the ``Joint Facilities Mainline.'' The 
pipeline extends from Westbrook, Maine to Dracut, Massachusetts. 
Specifically, the Joint Facilities Mainline requests a waiver of 
compliance from the following regulatory requirements:
     49 CFR 192.111--Design factor (F) for steel pipe;
     49 CFR 192.201--Required capacity of pressure relieving 
and limiting stations;
     49 CFR 192.611--Change in class location: Confirmation or 
revision of maximum allowable operating pressure; and
     49 CFR 192.619--Maximum allowable operating pressure: 
Steel or plastic pipelines.
    M&N placed its pipeline in service on December 1, 1999. M&N 
Operating Company, L.L.C., a wholly owned subsidiary of Duke Energy Gas 
Transmission, operates the pipeline. The pipeline is 24-inch diameter, 
Grade X-70 pipe with varying wall thicknesses. M&N inspected 100 
percent of the pipeline's girth welds using radiography. The pipeline, 
including girth welds, is coated with fusion bonded epoxy. M&N tested 
the Class 1 and 2 pipelines to 125 percent of MAOP and the Class 3 
pipeline was tested to 150 percent of MAOP. In addition, M&N performed 
an in-line inspection (ILI) of its pipeline in 2002 and no anomalies 
were detected.
    The Joint Facilities Mainline was placed in service on December 10, 
1999. This pipeline is 30 inches in diameter and is constructed of 
Grade X-70 pipe with varying wall thicknesses. M&N inspected 100 
percent of the pipeline's girth welds using radiography, and the 
pipeline, including girth welds, is coated with fusion bonded epoxy. 
The Joint Facilities Mainline tested the Class 1 and 2 pipelines to 125 
percent of MAOP, and the Class 3 pipeline was tested to 150 percent of 
MAOP. M&N performed an ILI of its 30-inch diameter pipeline in 2001 and 
a number of anomalies were detected. The anomalies were the result of a 
cathodic protection (CP) problem that M&N has resolved.

Pipeline System Analysis

    M&N conducted evaluations of the United States portion of its 
pipeline and the Joint Facilities Mainline to confirm whether the 
system could safely and reliably operate at increased stress levels. As 
part of its evaluation, M&N analyzed and compared the threats imposed 
on a pipeline operating at 72 percent of SMYS to those imposed on a 
pipeline operating at 80 percent of SMYS, including: (1) External 
corrosion; (2) internal corrosion; (3) stress corrosion cracking; (4) 
pipe manufacturing; (5) construction; (6) equipment; (7) immediate 
failure due to puncture; (8) delayed failure due to resident defects or 
damage; (9) incorrect operation; and (10) weather/outside factors. M&N 
asserts that any impacts that could potentially threaten the integrity 
of its pipeline as a consequence of the pipeline operating at higher 
stress levels have been addressed and resolved.
    M&N requested a waiver of compliance from the regulatory 
requirements at 49 CFR 192.111. This regulation prescribes the design 
factor to be used in the design formula in Sec.  192.105. The design 
factors are found in the following table:

------------------------------------------------------------------------
                                                                Design
                       Class location                         factor (F)
------------------------------------------------------------------------
1..........................................................         0.72
2..........................................................         0.60
3..........................................................         0.50
4..........................................................         0.40
------------------------------------------------------------------------

    M&N proposed a design factor of 80 percent of SMYS for Class 1, 67 
percent of SMYS for Class 2, and 56 percent of SMYS for Class 3 
locations.
    M&N also requested a waiver from Sec.  192.201(a)(2)(i) which 
states if the MAOP is 60 psig or more, the pressure may not exceed MAOP 
plus 10 percent, or the pressure that produces a hoop stress of 75 
percent SMYS, whichever is lower. M&N proposes to set the over pressure 
protection for the waiver sections to 104 percent of the pipeline's 
MAOP. This setting is based on the ratio of 75 percent to 72 percent of 
SMYS.
    M&N also requested a waiver from the requirements of Sec.  
192.503(c) for the 203-mile section of its 24-inch pipeline, which 
limits the maximum allowable hoop stress to 80 percent of the 
pipeline's SMYS if air, natural gas, or inert gas is used as the test 
medium. M&N desires to test its compressor station piping to 82 percent 
of SMYS. M&N did not request a waiver from this section of the 
regulations for the Joint Facilities Mainline.
    Section 192.611 requires an operator to confirm or revise the MAOP 
of its pipeline if the hoop stress corresponding to the established 
MAOP of a segment of pipeline is not commensurate with the present 
class location. M&N notes that any future class location changes may 
result in separate waiver requests.
    Finally, M&N requested relief from Sec.  192.619, which establishes 
the test factor requirements for pipelines, but does not reference a 
test factor for pipelines operating at 80 percent SMYS. All class 
locations in the M&N pipeline system have been tested to the most 
conservative requirements listed in Sec.  192.619, including 1.25 for 
class 1, 1.25 for class 2, and 1.5 for class 3. M&N asserts conformity 
with ASME B31.8 testing requirements in which the test factor is 
established at 1.25 for pipelines operating at 80 percent SMYS.

Comments on the Waiver

    On March 22, 2006, PHMSA published a notice of intent to consider 
the waiver and solicited public comments. On May 15, 2006, PHMSA 
extended the public comment period to June 16, 2006. PHMSA received 29 
comments.
    Seven commenters supported the waiver and provided conditions for 
approval, which PHMSA addressed in the supplemental safety criteria. 
Five commenters raised technical concerns. These issues included design 
limitation of railroad crossings to 60 percent of SMYS and concerns 
about increased pipeline operating pressure and blasting operations. 
PHMSA notes that the M&N pipeline operating stress levels at railroad 
crossings meet current railroad guidelines and will continue to conform 
to the requirements after increasing the pressure on the pipeline 
(uprating). The conditions later described in this waiver require M&N 
to have an acceptable plan to monitor and mitigate the affects of 
ground movement on the pipeline. Issues include monitoring of blasting 
operations adjacent to the pipeline.
    Seventeen commenters opposed the waiver because of concerns about 
the increase in the impact radius of the pipeline after the pressure 
uprating. The

[[Page 39150]]

supplemental safety criteria established by PHMSA address the increased 
impact radius. The remaining commenters raised issues outside the scope 
of this waiver request, such as compensation and aesthetics.

Grant of Waiver

    PHMSA considered M&N's waiver request and whether its proposal will 
yield an equivalent or greater degree of safety than that currently 
provided by the regulations. PHMSA published its notice of intent to 
consider waiver and solicited comments on March 22, 2006 (71 FR 14575).
    Based on M&N's application for waiver for its new pipeline and 
PHMSA's extensive technical analysis and favorable feedback from the 
impacted States and Technical Pipeline Safety Standards Committee, 
PHMSA hereby grants M&N's waiver request provided M&N, or a successor 
operator, complies with the following supplemental safety criteria:

Pipe and Material Quality

    1. Fracture Control Plan: M&N must implement an overall fracture 
control plan addressing fracture initiation, propagation, and Charpy 
arrest values. The fracture initiation, propagation, and arrest plan 
must account for the entire range of temperatures, pressures, and gas 
compositions planned for the pipeline.
    2. Fittings: All pressure rated fittings and components (including 
flanges, valves, gaskets, pressure vessels and compressors) must have a 
pressure rating commensurate with the MAOP and class location of the 
pipeline. Designed fittings (including tees, elbows and caps) must have 
the same design factors as the adjacent pipe.
    3. Station Design Factor: M&N may use a design factor not exceeding 
0.56 for existing compressor and meter stations. New compressor and 
meter stations must be designed using a design factor of 0.50 per Sec.  
192.111.
    4. Temperature Control: The compressor station discharge 
temperature must be limited to 120[deg] Fahrenheit or a temperature 
below the maximum long term operating temperature for the pipe coating.
    5. Overpressure Protection: Mainline pipeline overpressure 
protection must limit pressure to a maximum of 104 percent MAOP.

Supervisory Control and Data Acquisition (SCADA)

    6. SCADA System: M&N must use a SCADA system to provide remote 
monitoring of the pipeline system.
    7. Mainline Valve Control: Mainline valves that reside on either 
side of pipeline segment containing a High Consequence Area (HCA) where 
personnel response time to the valve exceeds one (1) hour must be 
remotely controlled by the SCADA system. The SCADA system must be 
capable of opening and closing the valve and monitoring the valve 
position, upstream pressure and downstream pressure. As an alternative 
to remote control mainline valves, M&N may implement a leak detection 
system.
    8. SCADA Set Point Review: M&N must implement a detailed procedure 
to establish and maintain accurate SCADA set points to ensure the 
pipeline operates within acceptable design limits at all times.

Operations and Maintenance

    9. Leak Reporting: M&N must notify the PHMSA Eastern Regional 
Office as soon as practicable of any non-reportable leaks occurring on 
the pipeline covered by their waiver.
    10. Annual Reporting: Annually, following approval of the waiver, 
M&N must report the following:
     The results of any ILI or direct assessments performed 
within the waiver area during the previous year;
     Any new integrity threats identified with the waiver area 
during the previous year;
     Any encroachment in the waiver area, including the number 
of new residences or public gathering areas;
     Any reportable incidents associated with the waiver area 
containing the waiver location that occurred during the previous year;
     Any leaks on the pipeline in the waiver area that occurred 
during the previous year;
     List of all repairs on the pipeline made in the waiver 
area during the previous year;
     On-going damage prevention initiatives on the pipeline in 
the waiver area and a discussion of their success; and
     Any company mergers, acquisitions, transfers of assets, or 
other events affecting the regulatory responsibility of the company 
operating the pipeline to which this waiver applies.
    11. Pipeline Inspection: The pipeline must be capable of passing 
ILI. All headers and other segments covered under the waiver that do 
not allow the passage of an internal inspection device must have a 
corrosion mitigation plan.
    12. Gas Quality Monitoring and Control: A gas quality monitoring 
and mitigation program must have the ability to restrict constituents 
that promote internal corrosion to not exceed the following limits:
     H2S (4 grains maximum);
     CO2 (3 percent maximum);
     H2O (less than or equal to 7 pounds per million 
standard cubic feet and no free water); and,
     Other deleterious constituents that may impact the 
integrity of the pipeline must be minimized.
    13. Gas Quality Control Equipment: Filters/separators must be 
installed at locations where needed to comply with the above gas 
quality requirements and meet M&N's gas tariff.
    14. Control of Liquids: Gas quality monitoring equipment must be 
installed to permit the operator to manage the introduction of 
contaminants and free liquids into the pipeline.
    15. Corrosion Mitigation Plan: M&N must submit an external 
corrosion mitigation plan as summarized in its waiver petition.
    16. Initial Close Interval Survey: An initial baseline Close 
Interval Survey (CIS) must be completed in concert with the baseline 
ILI indicated in American Petroleum Institute (API) supplementary 
requirement 21 and as detailed in its waiver petition.
    17. Verification of Cathodic Protection: A CIS must be performed in 
concert with ILI in accordance with 49 CFR part 192, subpart O 
reassessment intervals for all HCA pipeline mileage. If any annual test 
point readings fall below subpart I requirements, remediation must be 
performed and must include a CIS on either side of the affected test 
point.
    18. Pipeline Markers: The pipeline must employ line-of-sight 
markings in the waiver area except in agricultural areas, subject to 
Federal Energy Regulatory Commission permits or environmental permits 
and local restrictions.
    19. Pipeline Patrolling: The pipeline must be patrolled at least 
monthly to inspect for excavation activities, ground movement, 
washouts, leakage, and/or other activities and conditions affecting the 
safe operation of the pipeline.
    20. Monitoring of Ground Movement: An effective monitoring/
mitigation plan must be in place to monitor for and mitigate issues of 
unstable soil and ground movement.
    21. Uprating Plan Review and Approval: The uprating plan must be 
submitted to the PHMSA Eastern Regional Office for review and approval 
before the uprating plan is executed.
    22. Preliminary Criteria Reporting: A preliminary report describing 
the results, completion dates and status of the supplementary 
requirements must be completed and submitted to PHMSA

[[Page 39151]]

Headquarters and PHMSA Eastern Regional Office prior to commencing the 
uprating of the pipeline system.
    23. Criteria Completion Reporting: A report describing results, 
completion dates and status of the outstanding supplementary 
requirements must be submitted to PHMSA Headquarters and PHMSA Eastern 
Regional Office within 180 days after the uprating is completed. A 
final report must be submitted upon completion of the second ILI run 
for the pipeline.

Integrity Management

    24. Initial ILI: A baseline ILI must be performed in association 
with M&N's waiver petition on the pipeline using a high resolution 
Magnetic Flux Leakage (MFL) tool and a geometry tool before uprating 
the pipeline. The results of the baseline ILI must be integrated with 
the baseline CIS as described in criteria number 16.
    25. Future ILI: A second high-resolution MFL ILI must be performed 
on pipe subject to this waiver following the baseline ILI and must be 
completed within the first reassessment interval required by subpart O, 
regardless of HCA classification. Future ILI inspections must be 
performed on a frequency consistent with subpart O for the entire 
pipeline covered by this waiver.
    26. Direct Assessment Plan: Headers, mainline valve bypasses, and 
other sections covered by this waiver that cannot accommodate ILI tools 
must be part of a Direct Assessment (DA) plan or other acceptable 
integrity monitoring method.
    27. Damage Prevention Program: Common Ground Alliance's damage 
prevention best practices must be incorporated into the Maritimes and 
Northeast damage prevention program.
    28. Anomaly Evaluation and Repair: Anomaly evaluations and repairs 
must be performed based upon the following:
     For purposes of this criteria, the Failure Pressure Ratio 
(FPR) is an indication of the pipeline's remaining strength from an 
anomaly and is equal to the predicted failure pressure divided by the 
MAOP.
     Anomaly Response Time.
     [cir] Any anomaly with a FPR equal to or less than 1.1 must be 
treated as an ``immediate'' per subpart O.
     [cir] Any anomaly with an FPR equal to or less than 1.25 must be 
repaired within 12 months per subpart O.
     [cir] Any anomaly with an FPR greater than 1.25 must have a repair 
schedule according to subpart O.
     Anomaly Repair Criteria.
     [cir] Segments operating at MAOP equal to 80 percent stress 
level--Any anomaly evaluated and found to have an FPR equal to or less 
than 1.25 must be repaired.
     [cir] Segments operating at MAOP equal to 66 percent stress 
level--Any anomaly evaluated and found to have an FPR equal to or less 
than 1.50 must be repaired.
     [cir] Segments operating at MAOP equal to 56 percent stress 
level--Any anomaly evaluated and found to have an FPR equal to or less 
than 1.80 must be repaired.
    a. All other pipe segments with anomalies not repaired must be 
reassessed according to subpart O and American Society of Mechanical 
Engineers (ASME) standard B31.8S requirements. Each anomaly not 
repaired must have a corrosion growth rate and ILI tool tolerance 
assigned per the Gas Integrity Management Program (IMP) to determine 
the maximum re-inspection interval.
    b. Operators must confirm the remaining strength (R-STRENG) 
effective area method, R-STRENG--0.85dL, and ASME B31G assessment 
methods are valid for their pipe diameter, wall thickness, grade, 
operating pressure, operating stress level, and operating temperature. 
If it is not valid, M&N must submit a valid evaluation method to PHMSA. 
Until confirmation of the previously mentioned anomaly assessment 
calculations has been performed, M&N must use the most conservative of 
the calculations for anomaly evaluation.
    c. Dents must be evaluated and repaired per Sec. Sec.  
192.309(b)(ii) and 192.933(d)(l)(ii).
    29. Potential Impact Radius Calculation Updates: If the pipeline 
operating pressures and gas quality are determined to be outside the 
parameters of the C-FER Study, a new study with the uprated parameters 
must be incorporated into the IMP.
    If at anytime PHMSA determines the effect of the waiver is 
inconsistent with pipeline safety, PHMSA will revoke the waiver at its 
sole discretion.

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

    Issued in Washington, DC, on July 5, 2006.
Theodore L. Willke,
Deputy Associate Administrator for Pipeline Safety.
[FR Doc. 06-6107 Filed 7-6-06; 9:10 am]
BILLING CODE 4910-60-P