January 2021, Vol. 248, No. 1
Features
Pipeline Safety: New Directions, Old Concerns
By Richard Nemec, Contributing Editor
The well-respected global engineering consulting and construction firm based in Overland Park, Kan., Black & Veatch (B&V), has a corporate-wide focus on fostering sustainable infrastructure. The company’s radar these days has zeroed in on energy carrying pipelines as a meaningful sector of interest.
With more than 3,000 energy industry assignments in 40 countries, B&V engineers tend to be listened to, and the company thinks it has something important to say about oil and gas pipeline management.
Focusing on the more efficient and effective application of supervisory control and data acquisition (SCADA) systems, B&V is advocating for a more integrated, advanced and complete system for the management of long-haul pipelines. The company has drilled down to pipeline control rooms and their management, noting operators need to look beyond the stringent regulations governing their operations.
“While it’s commonly believed that the federal Pipeline and Hazardous Materials Safety Administration (PHMSA) rules strictly govern the management of control rooms, the pipeline’s chief purpose needs to be considered to fully understand the relationship between the pipeline’s commercial value and its role, along with how PHMSA rules factor into its safe operation,” B&V engineers wrote in a technical abstract. They contend that pipeline stakeholder needs should be included when shortening and improving the SCADA control room design phase.
As B&V exemplifies, in 2021, the oil and natural gas industry and regulators have a common focus on organizational excellence when it comes to pipeline safety management.
The emphasis is on improving safety through technology and innovation, enhancing emergency responsiveness, while increasing stakeholder awareness and involvement, according to industry organizations such as the American Petroleum Institute (API) and Pipeline Research Council International (PRCI).
“PHMSA shares these areas of focus and frequently collaborates with the industry to achieve these goals,” a senior official in the industry noted.
Policy Concerns
These days, the oil, gas and electrification rules are all influenced by decarbonization policies, which require more of an integrated approach between regulators, energy companies and stakeholders, which are reflected in the work of players like B&V and standard-setting organizations such as API.
PRCI President Cliff Johnson said research is a key component of maintaining and improving pipeline safety.
“A stated goal of the energy pipeline industry is to attain zero failures and reduce the environmental impact of the global pipeline infrastructure,” Johnson said. “These are ambitious goals that can only be met through research in a number of key areas. To move from 99.999% safe and efficient delivery of energy through pipelines, a strategic focus is needed.”
In collaboration with industry players, PRCI has articulated what Johnson calls “strategic research priorities” for attaining a zero-failure pipeline system. Those priorities include crack management, detection and mitigation of mechanical damage, geohazards, leak detection and greenhouse gas (GHG) emissions.
Johnson considers these areas “key challenges facing the industry that impede the attainment of zero failures.”
He hopes the focal points will stimulate more interaction among PRCI members, government and industry stakeholders. PRCI has the chance “to lead industry research in a more significant way” through advancements in technology and R&D that enhance pipeline safety and integrity globally, according to Johnson.
Nowadays, all incidents, regardless of size, cause concerns among industry officials and regulators. API hosts several events annually, providing the industry with a platform for sharing and learning. The Washington, D.C.-based organization encourages its members to share recent incidents with their peers to avoid similar incidents from reoccurring while also closely monitoring PHMSA incident data and creating initiatives to help reduce the specific incidents, as well as the overall number of incidents.
On Sept. 10, 2018, Texas-based Energy Transfer LP’s (ET) Revolution Pipeline withstood a landslide in Center Township, Beaver County, Pa., separating a section of the pipeline and releasing methane gas. The gas ignited, causing a fire that burned several acres of forested areas, destroyed a single-family home, a barn, and numerous vehicles; nearby residents were evacuated, and six high-voltage electric transmission towers collapsed.
Eventually, early in 2020, the Pennsylvania Department of Environmental Protection (DEP) issued a consent order and agreement and fined ET $30.6 million.
Last fall, ET’s pipeline unit in western Pennsylvania informed DEP that it intended to put the Revolution Pipeline into service but did not identify when gas would be placed into the pipeline. DEP objected to putting both gas and liquids into what it considered still unstable portions of the pipeline. Subsequently, DEP issued an order to prevent ETC Northeast Pipeline, LLC (ETC) from putting gas in unstable sections in four counties.
‘Unstable Slopes’
“There are currently numerous unstable slopes along the pipeline route, although ET received approval to permanently stabilize several of these areas beginning in April 2020,” a DEP spokesperson said. “If another landslide or landslides were to occur, it could displace and separate the Revolution Pipeline, and the impacts could be worse than the explosion in 2018, because the pipeline’s contents would be more explosive with the addition of natural gas liquids. This would cause a significant pollution event and pose a great danger to human health, safety and the environment.”
As one of its strategic research areas, PRCI’s researchers identify geohazards like landslides and other ground displacement events as a “significant threat” to the safe operation of oil/gas pipelines. Both existing assets and new construction can be at risk, particularly in geotechnically active areas.
As an emerging area of focus, the field of geohazard management has recently yielded numerous publications on identifying, evaluating and mitigating geohazards along with numerous case histories, according to PRCI. The documents can be useful to experts in the field and focus on aspects that could form part of an effective geohazard management program.
As was discussed in a Gas Machinery Conference presentation last fall, regulation for pipelines is much broader than PHMSA or state energy agency jurisdictions. Operations share compliance responsibility, and it is a moving target as regulatory coverage broadens, emission targets become more stringent and reporting obligations grow, according to Jim McCarthy, an executive with Innovative Environmental Solutions Inc., in Cary, Ill.
“Air quality data management and integration with company systems continue to evolve, despite ongoing challenges as rules evolve for air emissions related to pipeline infrastructure,” McCarthy told the industry conference.
McCarthy’s world of pipeline air quality regulations is decidedly multistate, meaning that some rules differ along a given interstate pipeline.
“Grandfathered” equipment is common, and its regulatory status is changing as new control requirements are developed for existing infrastructure over the next five to 10 years, he said, noting that nitrogen oxides (NOx) and formaldehyde are primary emissions of concern as are byproducts of natural gas combustion.
Pipelines and compressors along a pipeline are both subject to new source performance standards (NSPS) and national emission standards for hazardous air pollutants (NESHAP). All of this adds up to an increasingly broad definition of safety for the pipeline space. PRCI has recognized this trend with its designation of GHG emissions as one of its strategic pipeline research areas of focus.
Win for Enbridge
After six years of regulatory starts and stops, success came to Canadian-based Enbridge in mid-November when Minnesota agencies awarded permits for a 340-mile leg across the state in its long-proposed Line 3 oil export pipe replacement project. Enbridge executives called it “an important step toward long-sought construction [which began in December].”
Minnesota’s Pollution Control Agency (MPCA) granted water quality certification for stream and wetland crossings, and the state Department of Natural Resources gave its final eight permits for other aspects of the state’s $2.6 billion share of the project. In early December, construction started on the long-delayed portion in Minnesota.
After overcoming various environmental and Native American tribal opposition, all other legs of the $9 billion, 1,031-mile pipe replacement project have been completed in Canada, North Dakota and Wisconsin. Minnesota permits enabled final U.S. federal approval by the U.S. Army Corps of Engineers.
Replacement pipelines like Line 3 and a 56-mile, $550 million in-state capacity expansion pipeline by Consumers Energy Co. in Michigan can be just as important as greenfield work in upgrading the overall safety of the North American pipeline network. Consumers Energy’s replacement of a 70-year-old, 20-inch pipeline is aimed at enhancing its overall system resilience and removing a gas supply bottleneck in the smaller pipeline points near Lansing to a terminus west of Ann Arbor, Mich
In approving the project, state regulators said that the 36-inch replacement pipeline will address “corrosion issues and seam weld and other anomalies on the pipeline, remove the bottleneck and otherwise provide a more resilient and flexible natural gas system.” And the CMS Energy utility proposed rerouting portions of the pipeline to avoid more densely populated areas.
While the exact sums spent on safety and regulatory compliance are hard to pin down, industry officials agree it is in the billions of dollars. API puts out an annual environmental expenditures report, which tracks how much the industry spends to reduce its environmental footprint and tracks the data by segment and medium, such as air, water and waste. Between 2009 and 2018, expenditures rose by 267%, from $669 million to $2.5 billion.
Aside from government regulations, API has several standards that range from loading and transporting pipe, to pipeline construction, to maintaining the pipeline once it is installed. These best practices are meant to provide a guide for operators on the safe installation and operation of their pipelines. “Proper construction techniques can help improve operational safety. If incorrectly installed, or if the pipeline is damaged during construction, anomalies can form over time and lead to a potential incident,” according to API.
PRCI researchers acknowledge that industry has devoted a significant amount of time and resources to managing cracks as a pipeline integrity threat, but even with all of that investment, there have still been high-profile failures, and that’s where better management can make a difference. “A key priority for PRCI is to close the gaps on mechanical damage [MD] research and produce a comprehensive set of guidelines and engineering assessment tools for managing the threat of MD that are aligned with current inline inspection and nondestructive examination technologies,” Johnson said.
API and PRCI are collaborating more closely as pipeline safety becomes more of a team sport in the industry. While API works closely with PRCI, it also stresses the importance of collaboration between the industry and the regulators. This collaboration will effectively allocate private and federal research funds while avoiding duplicative research.
In a joint report by API and the Association of Oil Pipelines (AOPL), collaborating with PHMSA, pipeline incidents were recorded as decreasing 36% while infrastructure build-out grew by 10% over the last five years. PHMSA provided the performance data used by API and AOPL each year to aid in creating their strategic plans for pipeline safety improvement.
Industry-wide goals in their 2020-2022 Strategic Plan include promoting organizational excellence, improving safety through technology and innovation, increasing stakeholder awareness and involvement, and enhancing emergency response preparedness.
API’s joint 2019 Pipeline Safety Excellence Performance Report was issued along with the 2020-2022 Strategic Plan for the pipeline industry. Researchers found that total pipeline incidents decreased 17% for the year. Additionally, pipeline incidents affecting people or the environment caused by corrosion, cracking or weld failure fell 50%, while incidents caused by equipment failure were down 15%.
Relatively Small
In 2019, most pipeline incidents were relatively small (5-50 bbl) and large incidents (500 bbl or more) occurred only 5% of the time. The API and AOPL report also highlighted that liquid pipeline mileage increased by under 10% over the 2015-2019 period. This included a 20% increase in crude oil pipelines and a 35% increase in total barrels delivered.
Also, in 2019, the U.S. Department of Transportation’s (DOT) PHMSA issued three final rules targeting the safety of onshore natural gas transmission and hazardous liquid pipelines, while expanding PHMSA’s authority to issue emergency orders covering unsafe conditions or hazards that pose imminent threats to pipeline safety.
DOT Secretary Elaine Chao called the new rules “significant revisions to federal pipeline safety laws.”
The Interstate Natural Gas Association of America (INGAA) supported the PHMSA rules and its CEO at the time, Don Santa, said the regulations embraced “new safety technologies and engineering practices.”
Throughout the months leading to the new rules, INGAA and several other energy trade associations joined pipeline safety groups in supporting enhanced gas transmission pipeline safety rules by PHMSA.
Under the new rules, pipelines have updated standards to meet, such as risk-based integrity management requirements, stronger procedures to protect infrastructure from extreme weather events and requirements for greater oversight of pipelines. These new rules address congressional mandates from the Pipeline Safety Act of 2011 and recommendations from the National Transportation Safety Board.
Climate change also is impacting the pipeline space, if not directly, indirectly through the push for electrification in the energy sector. The global power industry is in a state of transformation and needs to accelerate the path to net zero as many companies, communities and stakeholders forge ahead with commitments to lower carbon emissions. This means even more rigorous demands on the midstream pipeline space from industry and regulators alike.
Increasing Focus
To address the challenge of maintaining grid reliability while reducing GHG emissions, B&V for the past decade has been increasing its focus on advancing renewable energy and energy storage technologies, as well as furthering the deployment of hydrogen as a carbon-free fuel and advanced technologies for carbon capture.
All of these require highly efficient and safe pipeline and related infrastructure equipment. One of PRCI’s identified strategic research areas is “emerging fuels,” which includes the increased future use of hydrogen and renewable natural gas in parts of the existing North American energy pipeline network.
Aside from the various layers of regulation, congressional oversight can play a role as evidenced in late November when a Maryland Democrat in the House of Representatives questioned the Federal Energy Regulatory Commission’s (FERC) handling of landowner rights regarding the controversial Mountain View Pipeline out of the Marcellus Shale gas play in West Virginia. The issue centered on FERC’s ability to resolve disputes between landowners and gas pipeline developers.
Rep. Jamie Raskin (D-MD), chair of the Civil Rights and Civil Liberties subcommittee, specifically raised questions relating to certificate extensions, restoration delays, dispute resolution and “disposition of property for canceled projects.”
He cited the recent two-year extension granted to the five-party joint venture, 303-mile Mountain Valley Pipeline, necessary in large part because of legal challenges brought by project opponents.
As the industry enters a new year, the impact of the COVID-19 pandemic cannot be overlooked because its destruction of global supply and demand for energy affects producers, pipelines and utility distribution companies alike. “The first round of lockdown measures impacted industrial demand and LNG exports more than other sectors of U.S. natural gas demand,” said a November energy market report from Colorado-based BTU Analytics.
“With second wave lockdown measures expanding [at the end of 2020], it is time to examine any warning signals for impending natural gas demand destruction.” The report compared the magnitude of demand destruction from earlier lockdown measures on U.S. industrial demand to a potential sequel lockdown wave in late 2020-early 2021.
“BTU Analytics has revised its industrial demand forecast downward for the remainder of 2020, but how much of the recent stagnating momentum will carry forward into 2021? Our Henry Hub Outlook addresses revisions to industrial demand and LNG exports. Changes to these sources of demand could drive changes to the end-of-season gas storage outlook if a mild winter fails to drive natural gas demand.”
According to GlobalData, North American pipelines and LNG export projects have been the most impacted by the pandemic as their CapEx requirements are generally higher. The United States has the highest number of impacted projects in North America.
Oil and gas Analyst Haseeb Ahmed added, “The sector has undergone significant losses, pushing companies to take desperate measures such as reducing CapEx or delaying final investment decisions (FIDs). However, these can only be short-term solutions, and, to be able to ensure future business sustainability, midstream companies need to work on long-term strategies to tackle any such future challenge.”
Knowledge workers in the industry at B&V, PRCI and API seem to have fully embraced what Ahmed is suggesting. They are focused on the longer-term future, broadening the touchstones needed for a state-of-the-art approach to pipeline safety. In the midst of the pandemic and economic recovery, optimism seems high in this part of the oil/gas sector.
Richard Nemec is a regular contributor to P&GJ based in Los Angeles. He can be reached at rnemec@ca.rr.com.
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