PHMSA Western Region Updates

Western Regional Gas Conference Tempe, Arizona August 26, 2015

OST

PHMSA

HMT OPS

OIG

FHWA

FRA

FAA

SLSDC

NHTSA

MARAD

FMCSA

FTA STB

Pipeline and Hazardous Materials Administration

U. S. Department of Transportation (DOT)

Office of Pipeline Safety

Policy and Programs

Program Development Standards and

Rulemaking Engineering and

Research State Programs Enforcement Training and

Qualifications

Field Operations

Emergency Support and

Security Response

Regional Offices – Eastern – Southern – Central – Southwest – Western

PHMSA Regional Offices - 4 -

Our Mission

To protect people and the environment from the risks inherent in transportation of hazardous materials – by pipeline and other modes of transportation.

Underlying Principles

• PHMSA has regulatory oversight only of transportation-related pipelines.

• It is the responsibility of pipeline operators to understand and

manage the risks associated with their pipelines

• PHMSA’s primary role is to establish minimum safety standards (defined by required risk control practices) and to ensure that operators perform to these standards

• PHMSA also strives to impact operator performance beyond mere compliance with the regulations

What We are Trying to Prevent

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What We Regulate Pipeline Miles by System Types

System Type Miles %Total # Operators

Hazardous Liquid 192,396 7% 441

Gas Transmission 302,825 11% 990

Gas Gathering 17,429 1% 356

Gas Distribution

(Mains & Services ) 2,148,519 81% 1,358

Total 2,644,341 Some Operators

have multiple

System Types

Liquefied Natural Gas 133 Plants 203 Tanks 83

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What does PHMSA/Pipeline Safety do?

Develop inspection and enforcement standards for

design, construction, operations, and maintenance

of pipelines carrying hazardous gas and liquids

Conduct risk based inspections of these

regulations.

Response and investigation of pipeline accidents.

Educate system operators, emergency responders

and the general public

Conduct research on promising technologies and

knowledge needed to improve standards

Provide grants to states in support of their pipeline

safety programs – inspection/enforcement, damage

prevention, public education

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Not In it Alone • We partner with our States to enforce the

Federal regulations.

• 10 of the 12 States in the PHMSA Western Region have pipeline safety programs – AZ, CA, CO, ID, MT, NV, OR, UT, WA, and WY

inspect INTRAstate natural gas pipelines

– AZ, CA, and WA inspect INTRAstate petroleum pipelines

– AZ and WA inspect INTERstate pipelines

• States can add additional regulations for INTRAstate pipelines

PHMSA Supports these State Pipeline Programs

• PHMSA provides up to 80% funding of any State’s pipeline safety program

– Based on an annual Federal Audit of the program (Procedures, Field, and Records)

– The last year the average grant funding was approximately 74% of total program costs

• There is approximately $53 Million in Grant Money for 2015

Strategic Goals: Pipeline Safety

Reduce risk of serious pipeline incidents through use of

strong risk-based integrity management approach

Sharpen focus on key risks using data

Develop solutions to detect/characterize these risks

Promote systematic management of risk through

standards

Inspect and enforce integrity management standards

Build capacity of communities to carry out their

respective roles in living safely with the energy pipelines

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0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1986 1990 1994 1998 2002 2006 2010 2014

Index (1988 = 1)

Calendar Year

Pipeline Safety with Context Measures (1988-2013)

Nat. GasConsumption

PetroleumProductConsumption

PipelineMileage

U.S. population

Spills withenvironmentalconsequences

Incidentsw/death ormajor injury

Prepared by PHMSA with data from Energy Information Administration, Census Bureau, PHMSA Annual Report Data, PHMSA Incident Data - as of March 11, 2014

PHMSA Region Updates

• Another High Profile Release into the Yellowstone River

• High Profile Release into the Pacific Ocean near Santa Barbara/Goleta, CA

• Switch to Integrated Inspection Process (II) Yields Fewer Cases

• Used the Integrated Inspection Assistant Tool (IA) with more efficiency but it is still clunky.

• Construction Bakken, WY and NE Colorado tailing off

• Became PHMSA’s II and IA lead in February 2015

PHMSA Region Contacts & SMEs

• Chris Hoidal – Director of Western Region

• Bryn Karaus – Western Region Counsel

• Huy Nguyen, Jeff Gilliam, Terry Larson– Supervisors

• Peter Katchmar – Accident Coordinator

• Ross Reineke – Construction Coordinator

• Tom Finch and David Mulligan – Community Assistance and

Technical Services (CATS)

• David Mulligan - Inspection Assistant Power User

• Dustin Hubbard - PDM and Mapping Issues

• Jerry Kenerson – Safety Related Condition Follow-up

Western Region Offices

Western Region Office –

16 Engineers

12300 West Dakota Avenue, Suite 110

Lakewood, CO 80228

720-963-3160

Satellite offices in:

Cheyenne, WY (Accident Investigator)

Billings, MT (1 engineer)

Reno, NV (1 engineer)

Ontario, CA (4 engineers)

Anchorage, AK (7 engineers)

One Regional Attorney – DC

New Openings – 12 Engineers and 2 Auditors (Lakewood, Ontario, Montana, Salt Lake City, and Anchorage): Repeating announcement until filled

Western Region Priorities 2015 and 2016

– Hire and train new inspectors.

– Continue to build relationships with State and other Federal agencies prior to, during, and after spills.

– Continue to focus on IMP implementation – companies are not making continual improvement.

– Expand river and stream crossing surveys beyond Montana, Idaho, Northern Wyoming, and Northeastern Colorado.

– Get Better at II and IA - Revamp process, Fix User Interface, reword and slim down question sets, and provide training. Balance with more frequent specialized inspections.

Accidents – High Profile

Recent Accidents:

• 5/19/15 - Plains Pipeline L.P. Line 901 Crude Oil Release Santa Barbara, CA

• 1/17/15 – Bridger Pipeline’s Poplar Pipeline spills crude oil into the Yellowstone River near Glendive, MT

• 3/31/14 – Plymouth, WA LNG Plant –WUTC (lead) and PHMSA investigated, rebuild, and restart

Summary of PHMSA-Western Region Hazardous Liquid Incidents 2014-Present

Operator ID Operator Name Incident Date Significant Incident Flag

Summary of Incident # of Injuries # of Fatalities Barrels Spilled

300 PLAINS PIPELINE, L.P. 05/19/2015 Yes Crude oil spill through a culvert into the Pacific Ocean.

0 0 2400

39043 TALLGRASS PONY EXPRESS PIPELINE, LLC 03/12/2015 Yes Employee attempted to fix a threaded fitting which caused an oil release through 2” orifice.

0 0 300.0

18092 SFPP, LP 02/23/2015 Yes A leak from the bottom of the leak created a stain on the soil, 4.7 gallons spilled.

0 0 0.1

31056 ASIG - HONOLULU 01/21/2015 Yes Failure due to corrosion on the bottom of the tank floor.

0 0 1,000.0

31878 BRIDGER PIPELINE LLC 01/17/2015 Yes Crude oil spill into the Yellowstone River.

0 0 729.0

18092 SFPP, LP 12/09/2014 Yes Leak from under the tank chime. 0 0 0.0

39043 TALLGRASS PONY EXPRESS PIPELINE, LLC 11/17/2014 Yes Improper valve operation at location of Pig launcher.

0 0 119.1

30781 OLYMPIC PIPE LINE COMPANY 11/10/2014 Yes Leak from the pump discharge valve.

0 0 7.5

39043 TALLGRASS PONY EXPRESS PIPELINE, LLC 08/31/2014 Yes Oil leak on the ground in the vicinity of the pump.

0 0 200.0

31720 EXPRESS HOLDINGS (USA), LLC 08/07/2014 Yes Lightning strike damaged a section of pipe causing a small pinhole at the 2:30 position.

0 0 2.0

30826 WILLIAMS FIELD SERVICES 07/21/2014 Yes Valve failure due to a defective fitting.

0 0 1.0

Poplar Pipeline

Overview

The Release • The Poplar Pipeline ruptured on Saturday January 17,

2015, spilling approximately 30,000 gallons of crude oil into the Yellowstone River.

• The pipeline is 12 inches in diameter and 0.500w.t. seamless pipe in the area where it crosses under the Yellowstone River ~6 miles upstream from Glendive.

• The breach in the line occurred between two block valves approximately 6,800 feet apart where the line crosses the river.

• Findings show that the pipeline was exposed in the river following an ice dam event in 2014, exposure went undetected, and line failed due to water induced forces & vibrations.

Yellowstone River Response Workers recovered a total of 1,722 gallons/41 BBLs of oil from the iced over river.

PHMSA Response

• PHMSA Billings Inspector on scene before Operator to ensure isolation and begin field investigation

• CATS Manager (Mulligan) Responded soon after to provide support and to liaison with Local, State, and other Federal Officials at Unified Command

• Western Region personnel went to the SCADA Control Center in Casper, WY in order to gather pertinent operational data.

• Western Region issued CAO within days after the release.

• Accident investigation proceeding but based on pipe removal on April 8, 2015 it appears to be rupture at girth weld caused by bending coupled with vibration.

Yellowstone River Near Glendive, MT

Recovered Pipe April 8, 2015

PHMSA’s Focus (for MT River Crossings)

Prior to Spill Helped but ……..

1. Petroleum pipelines (crude oil and refined products)

2. Major river crossings (greater than 100 feet)

3. Located in Montana and rivers flowing into Montana

4. Constructed with open-trench technology

5. Exposed or lack of depth-of-cover

6. River history & characteristics

7. Follow-up on mitigation measures recommended by Operators consultants

Montana River Crossings Operator Major River

Crossings

(> 100 feet)

Installed by

Open Cut

Installed by

HDD

Installed above

water (bridge)

Bridger Pipeline 3 2 (shut down and

to be HDD per

2015 DOT Order)

1

CHS 9 2 (3) 6 (5) 1

ExxonMobil 4 1 (4) 3 (0)

Hiland (2014) 1 (0) 1 (0)

Marathon (WY)

- Affects MT waters

6 3 3

ONEOK 3 (HVL/NGL) 1 (HVL) 2 (NGL)

Phillips 66 (80 feet

or greater)

26 12 (22) 14 (4)

Plains 1 1

Spectra Energy 10 (3 in WY) 4 6

Tesoro 1 1

TOTALS 64 (63) 25 (39) 38 (24) 1

* Numbers in red represent crossing type before July, 2011

Poplar Pipeline Lesson Learned

• Need to push operators to monitor environmental conditions on pipeline right of way.

• Current regulations for water crossings are inadequate – Must consider probability of river scour and channel migration, not just depth of cover.

• Advisory Bulletin (April 9, 2015) should be considered when assessing the condition of operator’s water crossings.

• Companies must consider land movement & water crossings in their IMP preventative and mitigative measures.

Plains Pipeline L.P. May 19, 2015 Crude Oil Release

Santa Barbara, CA

• Estimated spill size 2400 barrels.

• Intense media coverage, and numerous oversight agencies at the Unified Command

• Preliminary findings show extensive corrosion under insulation, inaccurate ILI assessment, and no leak detection by control room

• Line is shut down & filled with Nitrogen

Plains Pipeline, L.P.

Line 901 (Las Flores to Gaviota)

** Not to Scale

Pacific Ocean

Santa

Barbara

El Capitan

State Beach

Refugio

State Beach

Gaviota

State Park

Hwy 101

Gaviota

Pump Station

Las Flores

Pump Station

Affected Segment

(~10.7 Miles)

To Bakersfield

Hwy 101

Shoreline

Failure Location

Spill Path

MOV 1 Refugio Creek

and Check Valve

Line 903 (127

Miles)

MOV2 Gaviota

Creek 1st Anomaly dig

(temporary clamp)

2nd and 3rd Anomaly digs

w/n 50’ of each other

Temporary dual clamp and recoat

MOV 208

(~ MP .04 in station)

MOV 109

(~ MP 10.7 in station)

Flow Direction

Offshore Platforms:

Hildago, Harvest, Hermosa

(Freeport McMoRan)

Offshore Platform – Holly

(Venoco)

Offshore Platforms:

Hondo, Harmony, Heritage

(ExxonMobil)

Created by: Dave Mulligan

4th Anomaly dig

(Composite sleeve)

Venoco Tie-In

Sisquoc

Pump Station

Plains Pipeline, L.P.

Line 901 (Las Flores to Gaviota)

** Not to Scale

Pacific Ocean

Santa

Barbara

El Capitan

State Beach

Refugio

State Beach

Gaviota

State Park

Hwy 101

Gaviota

Pump Station

Las Flores

Pump Station

Affected Segment

(~10.7 Miles)

To Bakersfield

Hwy 101

Shoreline

Failure Location

Spill Path

MOV 1 Refugio Creek

and Check Valve

Line 903 (127

Miles)

MOV2 Gaviota

Creek 1st Anomaly dig

(temporary clamp)

2nd and 3rd Anomaly digs

w/n 50’ of each other

Temporary dual clamp and recoat

MOV 208

(~ MP .04 in station)

MOV 109

(~ MP 10.7 in station)

Flow Direction

Offshore Platforms:

Hildago, Harvest, Hermosa

(Freeport McMoRan)

Offshore Platform – Holly

(Venoco)

Offshore Platforms:

Hondo, Harmony, Heritage

(ExxonMobil)

Created by: Dave Mulligan

4th Anomaly dig

(Composite sleeve)

Venoco Tie-In

Sisquoc

Pump Station

Release Site (~25 feet from Culvert)

Culvert Under Highway and RR Tracks to Ocean

Construction – The Good & the Bad

• Tailing off. New, smaller, less sophisticated players however some are being sold and operated by bigger companies.

• Larger HVL lines and crude oil lines coming south out of Bakken, WY, and CO, and on towards Gulf, Cushing, or Bushton, KS are wrapping up.

• Recently we are seeing the construction of oil train loading facilities in Wyoming and North Dakota

• Having problems during start up. Have had repeated problems with poor filling and start up plans.

Integrated Inspections

• System approach – contiguous, same vintage, same risks, one or more inspection units

• Heavy focus on Preparation to determine what to ask prior to inspections

• Tap multiple experts

• Data driven approach to determine where we focus our inspection resources

• Are beginning to find common precursors to recent incidents, e.g. hydraulic changes, parallel structures, AC interference, type of assessment

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Integrated Inspection

• Time consuming and labor intensive – taking 6 to 15 months from start to finish (Our case numbers and case severity dropped in 2014)

• Teams are hard to assemble and coordinate

• Operators are complaining about time to conduct

• Staff committed to inspections for months – lose management ability to re deploy staff

• Concerns that if we wait too long to conduct periodic inspections that operator will backslide

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7

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Enforcement Cases 1/2014 to 4/2015

Types of Enforcement Cases

Letter of Concern 11

Warning Letter 27

Notice of Amendment 7

Proposed Compliance Order 5

Proposed Civil Penalty 4

Safety Order 1

Corrective Action Order 1

Totals 2014 to Date 56

Civil Penalties Paid

TransColorado Pipeline $33,100

El Paso Natural Gas $27,500

ExxonMobil Pipeline Company $1,045,000

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8

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Total $1,1005,600

Recap Inspection Priorities

• Focus on Change

– New operator or new employees

– Change in assets, e.g. compressor stations, pump stations, commodities.

– Change in environmental condition – ground movement, flooding, nearby construction

– Requires more frequent visits to supplement our current risk based approach to Integrated Inspections

Questions?

Thank You! Tom Finch and Dave Mulligan

Western Region CATS Managers

U.S. DOT/PHMSA/Office of Pipeline Safety

12300 West Dakota Avenue, Suite 110

Lakewood, CO 80228

720-963-3160

thomas.finch@dot.gov

and

david.mulligan@dot.gov