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National Rules For NatGas Storage Coming in Wake of SoCalGas Leak, PHMSA Head Says

A federal interim rule setting national standards for natural gas storage facilities will be released before the end of the year, the head of the U.S. Department of Transportation's (DOT) Pipeline and Hazardous Materials Safety Administration (PHMSA) said on Tuesday as part of the release of a national task force report undertaken after a four-month storage well leak in Southern California (see Daily GPI, Feb. 18).

The Department of Energy (DOE) and PHMSA published a task force report outlining the lessons learned from Southern California Gas Co.'s (SoCalGas) Aliso Canyon facility storage well leak and making 44 recommendations for industry, federal, state and local regulators/governments to reduce the chances of the same thing happening at one of the other more than 400 similar storage facilities nationwide.

Co-chaired by Franklin Orr, DOE undersecretary for science and energy, and Marie-Therese Dominguez, PHMSA administrator, the task force found that while the Aliso Canyon-scale incidents "are rare," the potential consequences from similar incidents "can be significant," requiring additional actions to ensure safe, reliable operations over the long term.

Among the recommendations are three categories of steps to be taken to ensure: well integrity, public health and environmental safeguards, and energy reliability. A key area is avoiding what are called "single points of failure design" in the storage wells as was the case with the SoCalGas well that leaked over the prolonged period.

Except under limited circumstances, facility operators are urged to phase out the single-point-of-failure designs that contributed to the inability to swiftly control and repair the Aliso Canyon leak, Orr said.

Orr and Dominguez underscored the task force report's conclusion that natural gas "plays an important role in the nation's energy landscape" and that ensuring the reliability and safety of the nation's gas infrastructure is crucial.

Dominguez noted that currently gas storage is regulated by the states and through a series of industry written standards by the American Petroleum Institute (API) identified as standard practices 1170 and 1171. The task force report and these existing standards will be taken into consideration in PHMSA's upcoming interim rule for storage, she said.

"These will set national standards for underground gas storage," Dominguez said. "Right now, a lot of work has been done by API and it is very specific to the states and industry operations."

Commenting on the report, American Gas Association (AGA) COO Lori Traweek said, “Natural gas storage is fundamental to our nation’s energy use -- today and into the future. Natural gas storage regulations must recognize this irrefutable fact. We are pleased to see the Interagency Task Force recognize that gas storage cannot be discontinued or replaced without significantly compromising reliability.”

Traweek acknowledged that the report finds that “while incidents at U.S. underground natural gas storage facilities are rare, the potential consequences of those incidents can be significant and require additional actions to ensure safe and reliable operation over the long term.”

“We share that goal,” she said. “Natural gas operators remain focused on enhancing the safety of their underground storage operations.”

Traweek said representatives from AGA, the Interstate Natural Gas Association of America and the American Petroleum Institute met with Dominguez and Orr to discuss the findings of the report. AGA and its members are reviewing the recommendations and will continue to collaborate with federal agencies on data-gathering initiatives. They also will provide technical information on what operators are doing to ensure the integrity of their underground storage wells.

“Beyond federal and state regulation, industry has taken the initiative to work with external stakeholders to develop two recommended practices (RP) -- accredited by the American National Standards Institute -- for underground storage,” she said. “RP 1170 and 1171 provide guidance to operators on how to design, operate, and ensure the integrity of underground storage for natural gas.”

INGAA CEO Don Santa questioned the timing before the root-cause analysis on the Aliso Canyon leak was completed and the task force's call for double barriers in storage wells, while noting the national pipeline operators' association is still evaluating the recommendations and "strongly supports" storage safety advancements.

Separately, a Washington, DC-based API spokesperson also said his organization is reviewing the interagency task force recommendations, which he characterized as recognizing underground gas storage's "critical role in meeting the nation's demands for natural gas."

Environmental Defense Fund (EDF) officials supported the need for federal rules for the more than 400 underground gas storage facilities spread over about 30 states, but they also urged that the Federal Energy Regulatory Commission consider various market reforms for the electricity and gas grids that would "reduce future dependence on natural gas and gas storage."

In the midst of the Aliso Canyon leak last January, EDF's Mark Brownstein, vice president for climate and energy programs, called for federal regulators to "get involved," by establishing tighter requirements for inspecting and maintaining the nation's gas storage facilities, and longer term, for policymakers to rethink the role of natural gas in the nation's energy mix (see Daily GPI, Jan. 11).

Singled out in the report are 12 major storage facilities nationwide, including Aliso Canyon, that the task force determined have the potential to greatly impact electricity generation over wide sections of the nation, recommending that the industry, federal and state officials look for ways to "strengthen the planning and coordination efforts to decrease the impacts from any prolonged disruption to the gas storage infrastructure."

In response to a question on the webinar, Orr noted that two of the dozen facilities are in California -- Aliso and Pacific Gas and Electric Co.'s (PG&E) McDonald Island facility in the north -- with the rest clustered mostly in the Gulf of Mexico coastal region, and each facility had impacts individually on up to 2 GW of power generation. "Those are big enough to have a significant effect on the power grid," he said.

"We think that we need to have a better resolution of the kind of data that explains how those facilities [mostly larger, salt dome storage in the Gulf] are connected to power plants," said Orr, adding that the task force report calls for obtaining data that will allow for more detailed analysis of possible vulnerabilities for the grid.

In response to another question, Orr talked about the single-point-of-design issue inherent in many of the nation's more than 12,000 gas storage wells. It refers to the use of a single casing in the wells, and the report is recommending that each well have additional tubing so there is a second barrier if the injection/withdrawal piping springs a leak.

"A significant fraction of the storage wells use just the casing as the primary barrier," he said. "We're recommending moving away from those designs so there is a secondary containment."

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