May 2011, Vol. 238 No. 5

Government

PHMSA Forum Kicks Off New Pipeline Safety Focus

It is still unclear if anything substantive will result from the pipeline safety forum Transportation Secretary Ray LaHood held on April 18. The forum followed a press conference LaHood and PHMSA Administrator Cynthia
Quarterman held in Pennsylvania on April 4 where they announced a vague “action plan” meant to respond to a recent series of pipeline explosions, the latest in Allentown, PA in February when a distribution line ignited, killing five people.

LaHood wants to “accelerate rehabilitation, repair, and replacement programs for high-risk pipeline infrastructure and to re-qualify that infrastructure as fit for service.” He has supplied no specifics, and a spokesman at the Pipeline and Hazardous Materials Safety Administration (PHMSA) declined to do so prior to the April 18 Forum, which ostensibly was held to get ideas from natural gas transmission, gas distribution and hazardous liquids pipeline industry officials on how to accomplish LaHood’s general goals.

Don Santa, president and CEO of the Interstate Natural Gas Association of America, says transmission pipelines will work with LaHood, and have already adopted guiding principles to improve the industry’s safety
performance and restore public confidence in the natural gas pipeline infrastructure.

LaHood has been specific in saying he wants to increase PHMSA’s civil penalty authority, which he requested from Congress last fall when he submitted the Strengthening Pipeline Safety and Enforcement Act of 2010. It increased civil penalties and added inspectors. The bill went nowhere.

Also in the fall of 2010, in testimony to Congress, Quarterman announced that PHMSA was considering a host of additional safety measures including identifying additional areas along pipelines that should receive extra protection or be included in the high consequence area category for integrity management protection and establishing minimum requirements for point-to-point leak detection systems. But PHMSA has never proposed actual regulatory changes in those areas via a rulemaking, nor asked Congress for authority to do so.

This year. Sen. Frank Lautenberg (D-NJ), chairman of the Senate subcommittee on surface transportation and merchant marine infrastructure, safety, and security, has introduced the Pipeline Transportation Safety Improvement Act of 2011 (S. 275). It does increase PHMSA civil penalties for “major consequence violations” and mandates a regulation to require the use of automatic or remote-controlled shut-off valves (or equivalent technology) on pipelines. With regard to existing IM programs, the bill vaguely asks PHMSA to “evaluate specified questions” but does not expand HCAs for any pipeline IM program. The bill dictates a report on leak detection systems, but no new regulations.

At his April 4 press conference, LaHood mentioned a meeting with pipeline company officials he held in mid-March where he asked them to step up efforts to identify high-risk pipelines, check them for problems, and fix those problems. Andrew Black, president of the Association of Oil Pipelines, says several American Petroleum Institute-AOPL executives were at that meeting.

“I am not aware of a request to accelerate ongoing work,” he adds.

Obama Administration Announces Fracing Initiative
President Obama mentioned a new “fracing” initiative in the energy policy proposal he issued at the end of March. The president wants to increase “transparency about the use of fracing chemicals…and develop recommendations for shale extraction practices that will ensure the protection of public health and the environment.” That will apparently be done through the Department of Energy’s Energy Advisory Board, which meets twice a year and whose members are mostly former high-ranking government and industry executives.

Daphne Magnuson, spokeswoman for the Natural Gas Supply Association, says the NGSA would be happy to work with Energy Secretary Steven Chu on the initiative. “We haven’t heard from the department yet,” she adds. Department of Energy officials did not respond to e-mails asking for details about the new initiative.

The Environmental Protection Agency already has a “fracing” study in progress, and it is not clear how the DOE initiative will differ from what the EPA is already doing. At Senate hearings April 12 Bob Perciasepe, deputy administrator of the EPA, said the study would not present results until the end of 2012. Despite national publicity around the issue of potential groundwater contamination from fracing, none of the witnesses at the hearings in the Senate Environment and Public Works Committee presented any evidence to support those allegations.

Jeff Cloud, vice chairman, Oklahoma Corporation Commission, told the Senate committee hydraulic fracturing has been used for over 60 years in Oklahoma and more than 100,000 Oklahoma wells have been hydraulically
fractured over that period. “Over that more than half century of hydraulic fracing experience, there has not been a single documented instance of contamination to groundwater or drinking water as result of hydraulic fracturing,” he said.

In terms of disclosing use of fracing chemicals, Sen. Bob Casey (D-PA), who accompanied LaHood and Quarterman to Pennsylvania on April 4, re-introduced the FRAC Act in the Senate in mid-March. That bill had been introduced in the last session of Congress but no action had been taken. The FRAC Act would require producers to disclose fracing fluid composition to the EPA under the Safe Drinking Water Act. States would make that information public.

The NGSA and other natural gas groups have endorsed the Ground Water Protection Council/Interstate Oil and Gas Compact Commission state-based registry that launched on April 11.

BOEMRE Awards $600,000 For Louisiana Marsh Restoration
The Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) has awarded a $600,000 Coastal Impact Assistance Program (CIAP) grant to Lafourche Parish, LA which will provide the remaining funding for a project begun previously to shape sediment in a 4,000-foot maritime ridge and associated fringe marsh near Port Fouchon, LA.

Created by the Energy Policy Act of 2005, CIAP provides funding to the six Outer Continental Shelf (OCS) oil and gas producing states to conserve and protect the coastal environment. CIAP is an ongoing program with grant funding that is allocated based on the offshore energy revenues collected by the United States.

“Marsh restoration is critical to the state of Louisiana,” said BOEMRE Director Michael Bromwich. “We will continue to provide CIAP funds to help the state and Lafourche Parish protect their coastal ecosystem.”
The grant will encompass the remaining funds needed to continue a project, initiated in 2006, that pumped sediment into a maritime forest ridge and its associated fringe marsh. This phase will shape and form the originally pumped sediment and also provide for the planting and completion of the vegetative component and project evaluation.

The Maritime Forest Ridge and Marsh Restoration project is located in lower Lafourche Parish near Port Fouchon in the Barataria Basin. CIAP received $250 million in appropriated funds for each of the fiscal years
2007-2010, to be disbursed to six eligible OCS oil and gas producing states: Mississippi, Alabama, Alaska, California, Louisiana and Texas.