[Federal Register Volume 72, Number 245 (Friday, December 21, 2007)]
[Notices]
[Pages 72815-72819]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-24776]


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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

[Docket No. PHMSA-2006-24058]


Pipeline Safety: Grant of Special Permit; TransCanada Pipelines 
Limited

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

ACTION: Notice; Grant of Special Permit.

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SUMMARY: The Pipeline and Hazardous Materials Safety Administration 
(PHMSA) is granting TransCanada Pipelines Limited (TransCanada) a 
special permit waiving compliance from the Federal pipeline safety 
regulation in 49 CFR 192.611 for two pipeline segments in the Portland 
Natural Gas Transmission System, described below under ``Pipeline 
System Affected.'' The regulation requires natural gas pipeline 
operators to confirm or revise the maximum allowable operating pressure 
of a pipeline after a change in class location.

FOR FURTHER INFORMATION CONTACT: Alan Mayberry at (202) 366-5124, or by 
e-mail at Alan.Mayberry @dot.gov; or Wayne Lemoi at (404) 832-1160 or 
by e-mail at [email protected].

SUPPLEMENTARY INFORMATION: 

Special Permit Request

    Pipeline Operator: TransCanada petitioned PHMSA on April 8, 2005, 
for a special permit to waive compliance from the Federal pipeline 
safety regulation in 49 CFR Sec.  192.611 for two pipeline segments of 
the Portland Natural Gas Transmission System (PNGTS) 24-inch mainline 
operated by TransCanada and described below under ``Pipeline System 
Affected.'' The regulation requires natural gas pipeline operators to 
confirm or revise the maximum allowable operating pressure (MAOP) of a 
pipeline after a change in class location.
    Pipeline System Affected: This special permit request covers two 
segments of a single 24-inch pipeline known as the PNGTS pipeline in 
and near the town of North Windham, Maine. Special permit segment 1 
includes 615 feet that changed from a Class 1 location to a Class 3 
location on March 1, 2004, and an additional 2,298 feet that

[[Page 72816]]

TransCanada anticipates will change from a Class 1 location to a Class 
3 location for a total of 2,913 feet. Special permit segment 2 is just 
upstream of special permit segment 1 and includes 4,766 feet 
anticipated by TransCanada to change from a Class 1 location to a Class 
3 location. Anticipated class location change for both special permit 
segments is due to residential and commercial development anticipated 
by TransCanada. The two ``special permit segments'' are defined as 
follows:
     Special Permit Segment 1: 2,913 feet, mile post (MP) 
132.20 to MP 132.75
     Special Permit Segment 2: 4,766 feet, MP 130.88 to MP 
131.78
    A special permit inspection area is defined as the area within 220 
yards of each side of a pipeline centerline along the entire length of 
the special permit segment and along the pipeline up to 25 miles 
upstream and downstream of the special permit segment. The ``special 
permit inspection area'' for this special permit consists of the area 
within 220 yards of each side of the PNGTS pipeline centerline along 
the entire length of the pipeline from 25 miles upstream of special 
permit segment 2 to approximately 10 miles downstream of special permit 
segment 1 and is inclusive of both special permit segments.

Public Notice

    On September 7, 2006, PHMSA published a notice of the TransCanada 
request in the Federal Register (71 FR 52871) inviting interested 
persons to comment on the request. On February 8, 2007, PHMSA posted 
another notice in the Federal Register (72 FR 6042) informing the 
public that we have changed the name granting a waiver to a special 
permit. We did not receive any public comments for or against this 
special permit request. We also requested and received supplemental 
information from TransCanada. The special permit petition, Federal 
Register notice, supplemental information from TransCanada and all 
other documents pertinent to this special permit request are available 
for review by the public in Docket Number PHMSA-2006-24058 in the 
Federal Docket Management System (FDMS) located on the internet at 
www.Regulations.gov.

Special Permit Analysis

    Background: On June 29, 2004, PHMSA published in the Federal 
Register (69 FR 38948) the criteria it uses for the consideration of 
class location change special permits. First, certain threshold 
requirements must be met for a pipeline section to be further evaluated 
for a class location change special permit. Second, the age and 
manufacturing process of the pipe; system design and construction; 
environmental, operating and maintenance histories; and integrity 
management program (IMP) elements are evaluated as significant 
criteria. These significant criteria are presented in matrix form and 
can be reviewed in the FDMS, Docket Number PHMSA-RSPA-2004-17401. 
Third, such special permits will only then be granted when pipe 
conditions and active integrity management provides a level of safety 
greater than or equal to a pipe replacement or pressure reduction.
    Threshold Requirements: Each of the threshold requirements 
published by PHMSA in the June 29, 2004 FR notice is discussed below 
for the TransCanada special permit petition.
    (1) No pipeline segments in a class location changing to Class 4 
location will be considered. This special permit request is for two 
pipeline segments in class locations that have changed or are 
anticipated to change from Class 1 to Class 3. This requirement has 
been met for both PNGTS special permit segments.
    (2) No bare pipe will be considered. Both special permit segments 
of the PNGTS pipeline are coated with Fusion Bond Epoxy (FBE), meeting 
this requirement.
    (3) No pipe containing wrinkle bends will be considered. There are 
no wrinkle bends in the special permit segments. This requirement has 
been met for both PNGTS special permit segments.
    (4) No pipe segments operating above 72 percent of the specified 
minimum yield strength (SMYS) will be considered for a Class 3 special 
permit. The PNGTS pipeline operates at or below 72 percent SMYS. This 
requirement has been met for both PNGTS special permit segments.
    (5) Records must be produced that show a hydrostatic test to at 
least 1.25 x MAOP. The PNGTS pipeline has been hydrostatically tested 
to 1,846 pounds per square inch gauge (psig), 1.28 x MAOP. This 
requirement has been met for both PNGTS special permit segments.
    (6) In-line inspection (ILI) must have been performed with no 
significant anomalies identified that indicate systemic problems. The 
PNGTS pipeline has been ILI inspected with no significant anomalies in 
the special permit segments, thus meeting this requirement.
    (7) The special permit inspection area must be inspected according 
to the operator's IMP and periodically inspected with an in-line 
inspection technique. This special permit will include conditions 
requiring TransCanada to perform additional inspections in the special 
permit inspection area on a frequency consistent with the integrity 
management regulations contained in 49 CFR Part 192, Subpart O. The 
special permit conditions will also require TransCanada to incorporate 
both special permit segments in its written IMP as ``covered segments'' 
in a ``high consequence area (HCA)'' per 49 CFR 192.903.
    Criteria Matrix: The original and supplemental data submitted by 
TransCanada for the special permit segments have been compared to the 
class location change special permit criteria matrix. The data falls 
within the ``probable acceptance'' column of the criteria matrix for 
all criteria except for a change, from a Class 1 location to a Class 3 
location, which falls within the ``possible acceptance'' column of the 
criteria matrix, and the ILI Time Frame Requirement which falls within 
the ``possible acceptance'' column of the criteria matrix.
    (1) Pipe design and construction, including pipe manufacture, 
material, design stress and weld radiography: the pipe of both special 
permit segments was manufactured in 1998-1999 of American Petroleum 
Institute Specification 5L, Specification for Line Pipe (API 5L), X-70 
steel, using a 72 percent SMYS design factor per Sec.  192.111, with 
documented 100 percent circumferential field weld radiographic 
inspection. The pipe coating is mill-applied FBE with field-applied FBE 
on circumferential welds. All of these factors fall within the 
``probable acceptance'' column of the criteria matrix.
    (2) Pressure testing: both special permit segments were pressure 
tested in 1998 to 1,846 psig corresponding to 128 percent MAOP and 92 
percent SMYS. No test failures occurred. These factors fall within the 
``probable acceptance'' column of the criteria matrix.
    (3) Environmental considerations: the depth of cover is given as 48 
inches for both special permit segments, exceeding the requirements of 
Sec.  192.327(a). Both special permit segments are located in stable 
terrain that does not contain any major slopes. These factors fall 
within the ``probable acceptance'' column of the criteria matrix.
    (4) Operational considerations: according to TransCanada, there 
were no leaks or failures in the two special permit segments of the 
pipeline. The pipeline transports only dry gas with light pressure 
fluctuations. Cathodic protection (CP) was operational in the fall of 
1999 on both pipeline special

[[Page 72817]]

permit segments, which was within 9 months of the in-service date of 
the pipeline. A baseline close interval survey (CIS) of the entire 
PNGTS pipeline was performed during the summer of 2000. No low 
potentials or CP anomalies were identified in the special permit 
segments. No safety related condition reports (SRCR) have been issued 
for the special permit segments. These factors fall within the 
``probable acceptance'' column of the criteria matrix.
    (5) Integrity management program: special permit segment 1 is 
currently within an HCA, while special permit segment 2 is anticipated 
by TransCanada to become an HCA in its entirety due to anticipated 
development. The entire PNGTS pipeline (including both special permit 
segments) transports odorized gas. Leakage surveys using leak detection 
equipment are performed annually on the entire pipeline including the 
special permit segments. PNGTS performed an ILI on November 1, 2002, 
which was more than two years but less than five years prior to the 
special permit application date, placing this criterion in the 
``possible acceptance'' column of the criteria matrix. Two minor (less 
than 4 percent) anomalies identified in the 2002 ILI were excavated in 
2005; no active corrosion was found. A high resolution magnetic flux 
leakage (MFL) ILI is scheduled for 2009 on the pipeline sections 
including the special permit segments. A baseline CIS was performed in 
2002 on the entire PNGTS pipeline system. TransCanada annually performs 
a CIS of 15-20 percent of the system and proposes to perform a CIS on 
the special permit segments annually. TransCanada has not identified 
any coating or corrosion issues. TransCanada proposes to perform a 
direct current voltage gradient (DCVG) survey on both special permit 
segments and 1,000 feet upstream and downstream of the special permit 
segments. TransCanada also proposes to perform weekly aerial patrols 
and quarterly ground road crossing patrols, including leakage surveys, 
using leak detection equipment in the proposed special permit segments. 
TransCanada additionally proposes to install buried excavation warning 
tape over the pipeline comprising the special permit segments. All of 
these factors, with the exception of the ILI time frame criterion, fall 
within the ``probable acceptance'' column. The ILI time frame falls 
within the ``possible acceptance'' column because it was several months 
outside the two year requirement prior to the special permit 
application.

Special Permit Findings

    PHMSA finds that granting this special permit is not inconsistent 
with pipeline safety and will provide a level of safety equal to or 
greater than pipe replacement or pressure reduction. We do so because 
the special permit analysis shows the following:
    (1) The special permit segments meet six of the seven threshold 
requirements. The seventh threshold requirement, that the special 
permit inspection area be inspected according to the operator's IMP and 
periodically inspected with an in-line inspection technique, will be 
addressed in the special permit conditions. The special permit 
conditions will also include annual inspection requirements of the 
special permit inspection area and both special permit segments on a 
frequency consistent with 49 CFR 192, Subpart O; the Integrity 
Management regulations.
    (2) The special permit segments fall in the ``probable acceptance'' 
column of the criteria matrix for all criteria except for class 
location change and ILI time frame. The class location change for both 
special permit segments is from a Class 1 location to a Class 3 
location, which places this parameter in the ``possible acceptance'' 
column. The last ILI that was performed on the entire PNGTS pipeline 
containing the special permit segments was on November 1, 2002, which 
is longer than two but less than five years preceding the special 
permit petition. This places the ILI time frame parameter in the 
``possible acceptance'' column.
    (3) The special permit conditions will require TransCanada to 
implement enhanced IMP actions for the entire special permit inspection 
area.

Special Permit Grant

    PHMSA grants a special permit of compliance from 49 CFR 192.611 to 
TransCanada Pipelines Limited for two pipeline segments defined below 
in or near North Windham, Maine in the Portland Natural Gas 
Transmission System. The special permit segments are where the class 
locations along the pipeline have changed or are anticipated to change 
in the future from a Class 1 location to a Class 3 location. As of July 
1, 2007, only 615 feet of special permit segment 1 has actually changed 
to Class 3 location. PHMSA is nevertheless granting this special permit 
for both the actual and the anticipated class location change along 
both special permit segments because the additional integrity 
management program actions required by this special permit for the 
entire special permit inspection area will enhance the safety of 
operation of the PNGTS pipeline. This special permit applies to the 
pipeline special permit segments defined as follows:
     Special permit segment 1: 2,913 feet, mile post (MP) 
132.20 to MP 132.75
     Special permit segment 2: 4,766 feet, MP 130.88 to MP 
131.78
    A special permit inspection area is defined as the area within 220 
yards of each side of a pipeline centerline along the entire length of 
the special permit segment and along the pipeline up to 25 miles 
upstream and downstream of the special permit segment. The ``special 
permit inspection area'' for this special permit consists of the area 
within 220 yards of each side of the PNGTS pipeline centerline along 
the entire length of the pipeline from 25 miles upstream of special 
permit segment 2 to approximately 10 miles downstream of special permit 
segment 1 and inclusive of both special permit segments.

Special Permit Conditions

    This special permit is granted with the following conditions:
    (1) TransCanada must continue to operate the special permit 
segments at or below the existing MAOP.
    (2) TransCanada must incorporate both special permit segment 1 and 
special permit segment 2 into its written IMP as ``covered segments'' 
in an HCA as defined in 49 CFR Subpart O, Sec.  192.903, except for the 
reporting requirements contained in 49 CFR 192.945. The special permit 
segments included in this special permit need not be included in 
TransCanada's IMP baseline assessment plan.
    (3) TransCanada must perform a CIS of the entire length of the 
special permit inspection area not later than one year after the grant 
of special permit and remediate any areas of inadequate cathodic 
protection. A CIS and remediation need not be performed on the special 
permit inspection area if a CIS and remediation have been performed 
within 6 years of the grant of special permit. If factors beyond 
TransCanada's control prevent the completion of the CIS and remediation 
within one year, a CIS and remediation must be completed as soon as 
practicable and a letter justifying the delay and providing the 
anticipated date of completion must be submitted to the Director, PHMSA 
Eastern Region not later than one year of the grant of special permit.
    (4) TransCanada must perform ongoing CIS of both special permit 
segment 1 and special permit segment 2 at the applicable reassessment 
interval(s) for a ``covered segment'' determined in accordance with 49 
CFR 192.939.

[[Page 72818]]

    (5) TransCanada must perform a Direct Current Voltage Gradient 
(DCVG) survey of both special permit segment 1 and special permit 
segment 2 not later than one year after the grant of special permit to 
verify the pipeline coating conditions and to remediate any integrity 
issues in the special permit segments. If factors beyond TransCanada's 
control prevent the completion of the DCVG and remediation within one 
year, a DCVG and remediation must be performed as soon as practicable 
and a letter justifying the delay and providing the anticipated date of 
completion must be submitted to the Director, PHMSA Eastern Region not 
later than one year of the grant of special permit.
    (6) TransCanada must evaluate the potential for stress corrosion 
cracking (SCC), according to 49 CFR 192.929 within one year after the 
grant of special permit. If the potential for SCC is identified, 
TransCanada must perform a stress corrosion cracking direct assessment 
(SCCDA) of the special permit inspection area in accordance with 49 CFR 
192.929.
    (7) TransCanada must submit the CIS, DCVG and SCCDA findings 
including remediation actions in a written report to the Director, 
PHMSA Eastern Region not later than two years after the grant of 
special permit.
    (8) TransCanada must amend applicable sections of its operations 
and maintenance (O&M) manual(s) to incorporate the inspection and 
reassessment intervals by ILI along the entire length of the special 
permit inspection area at a frequency consistent with 49 CFR Sec.  192, 
Subpart O.
    (9) TransCanada must amend applicable sections of its O&M manual(s) 
to incorporate the inspection and reassessment intervals by CIS of both 
special permit segment 1 and special permit segment 2 at a frequency 
consistent with 49 CFR Part 192, Subpart O.
    (10) The assessments of the special permit segments and the special 
permit inspection area using ILI must conform to the required maximum 
reassessment intervals specified in 49 CFR 192.939.
    (11) TransCanada must schedule future reassessment dates for the 
special permit inspection area according to 49 CFR Sec.  192.939 by 
adding the required time interval to the previous assessment date.
    (12) TransCanada must ensure their damage prevention program 
incorporates the applicable best practices of the Common Ground 
Alliance (CGA) within the special permit inspection area.
    (13) TransCanada must give sufficient notice to the Director, PHMSA 
Eastern Region to enable observation of any or all special permit 
related activities in the special permit inspection area.
    (14) TransCanada must determine and provide certification that all 
inspections and activities associated with this special permit will not 
impact or defer any of the operator's assessments for HCAs under 49 CFR 
part Sec.  192, subpart O, particularly those associated with the most 
significant 50 percent.
    (15) Within three months following approval of this special permit 
and annually thereafter, TransCanada must report the following to the 
Director, PHMSA Eastern Region:
    (a) The economic benefits of the special permit to TransCanada. 
This should address both the costs avoided from not replacing the pipe 
and the added costs of the inspection program (required for the initial 
report only).
    (b) In the first annual report, fully describe how the public 
benefits from energy availability. This should address the benefits of 
avoided disruptions as a consequence of pipe replacement and the 
benefits of maintaining system capacity. Subsequent reports must 
indicate any changes to this initial assessment.
    (c) The number of new residences, other structures intended for 
human occupancy and public gathering areas built within the special 
permit inspection area.
    (d) Any new integrity threats identified during the previous year 
and the results of any in-line inspections or direct assessments 
performed during the previous year in the special permit inspection 
area.
    (e) Any reportable incident, any leak normally indicated on the DOT 
Annual Report and all repairs on the pipeline that occurred during the 
previous year in the special permit inspection area.
    (f) On-going damage prevention initiatives affecting the special 
permit inspection area and a discussion on the success of the 
initiatives.
    (g) Any mergers, acquisitions, transfer of assets, or other events 
affecting the regulatory responsibility of the company operating the 
pipeline.
    (16) At least one CP pipe-to-soil test station must be located 
within each HCA with a maximum spacing between test stations of one-
half mile within an HCA. In cases where obstructions or restricted 
areas prevent test station placement, the test station must be placed 
in the closest practical location. This requirement applies to any HCA 
within the special permit inspection area.
    (17) If any annual test station readings within the special permit 
inspection area fall below 49 CFR part 192, subpart I requirements, 
remediation must occur within six months and include a CIS on each side 
of the affected test station to the next test station and identified 
corrosion system modifications to ensure corrosion control. If factors 
beyond TransCanada's control prevent the completion of remediation 
within six months, remediation must be completed as soon as practicable 
and a letter justifying the delay and providing the anticipated date of 
completion must be submitted to the Director, PHMSA Eastern Region not 
later than one year after the grant of special permit.
    (18) Anomaly Evaluation and Repair:
    (a) General: TransCanada shall account for ILI tool tolerance and 
corrosion growth rates in scheduled response times and repairs.
    (b) Dents: TransCanada shall repair dents in the special permit 
segments and special permit inspection area in accordance with 49 CFR 
Sec.  192.933.
    (c) Repair Criteria: Repair criteria applies to anomalies located 
within the special permit inspection area when they have been excavated 
and investigated in accordance with 49 CFR 192.485 and 192.933 as 
follows:
    (i) Special permit segments--repair any anomaly with a failure 
pressure ratio (FPR) less than or equal to 1.39 for pipe operating at a 
stress level up to 72 percent of SMYS and any anomaly greater than 50 
percent of pipe wall thickness.
    (ii) Special permit inspection area--the response time must be in 
accordance with 49 CFR Sec.  192, subpart O, the applicable edition of 
the American Society of Mechanical Engineers Standard B31.8S, Managing 
System Integrity of Gas Pipelines (ASME B31.8S) and TransCanada's IMP.
    (d) Response Time for ILI Results: The following guidelines provide 
the required timing for excavation and investigation of anomalies based 
on ILI results. Reassessment by ILI will ``reset'' the timing for 
anomalies not already investigated and/or repaired. TransCanada must 
evaluate ILI data by using either the ASME Standard B31G, Manual for 
Determining the Remaining Strength of Corroded Pipelines (ASME B31G), 
or the Modified B31G (0.85dL) for calculating the predicted failure 
pressure ratio to determine anomaly responses.
    (i) Special permit segment:

--Immediate response: FPR equal to or less than 1.1 or anomalies equal 
to and greater than 80 percent of pipe wall thickness;

[[Page 72819]]

--1-year response: pipe operating at a stress level up to 72 percent of 
SMYS--FPR equal to or less than 1.39 and anomalies equal to or greater 
than 60 percent of pipe wall thickness;
--Scheduled reponse: pipe operating at a stress level up to 72 percent 
of SMYS--FPR greater than 1.39 and anomalies less than 60 percent of 
pipe wall thickness.

    (ii) Special permit inspection area: The response time must be in 
accordance with 49 CFR Sec.  192, subpart O, ASME B31.8S (applicable 
edition) and TransCanada's IMP.
    (19) PHMSA may extend either or both of the original special permit 
segments to include contiguous segments of pipeline up to the limits of 
the special permit inspection area pursuant to the following 
conditions. TransCanada must:
    (a) Provide at least 90 days advance written notice to the 
Director, PHMSA Eastern Region and PHMSA Headquarters of a requested 
extension of either or both of special permit segment 1 and special 
permit segment 2 based on an actual class location change and include a 
schedule of inspections and of any anticipated remedial actions. If 
PHMSA Headquarters makes a written objection before the effective date 
of the requested special permit segment (90 days from receipt of the 
above notice), the requested special permit segment extension does not 
become effective.
    (b) Complete all inspections and remediation of the proposed 
special permit segment extension to the extent required of the original 
special permit segment.
    (c) Apply all the special permit conditions and limitations 
included herein to all future extensions.

Special Permit Limitations

    PHMSA has the sole authority to make all determinations on whether 
TransCanada has complied with the specified conditions. Should 
TransCanada fail to comply with any conditions of this special permit, 
or should PHMSA determine this special permit is no longer appropriate 
or that this special permit is inconsistent with pipeline safety, PHMSA 
may revoke this special permit and require TransCanada to comply with 
the regulatory requirements of 49 CFR 192.611.

    Authority: 49 U.S.C. 60118 (c)(1) and 49 CFR 1.53.

    Issued in Washington, DC on December 17, 2007.
Jeffrey D. Wiese,
Associate Administrator for Pipeline Safety.
[FR Doc. E7-24776 Filed 12-20-07; 8:45 am]
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