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Franks Plans New Pipeline Rules

Franks Plans New Pipeline Rules

Despite his promise to the gas industry last year that he wouldn't change the Pipeline Safety Act of 1995 (see Daily GPI, March 19, 1999), Congressman Bob Franks (R-NJ), chairman of the House Transportation and Infrastructure Subcommittee --- who also is running for a Senate seat in his home state --- introduced a bill last week that would do just that. His legislation joined a growing stack of pipeline safety bills that have been introduced this session.

With the Pipeline Safety Act due to expire in September and the Bellingham, WA, liquids pipeline explosion, which killed two 10-year-old boys and a young man, fresh in the minds of lawmakers, pipeline safety has become a significant concern this year. The Edison, NJ, explosion of the 36-inch diameter Texas Eastern natural gas pipeline in 1994 also appears to still be fresh in the minds of some New Jersey congressmen.

The Franks bill, titled the Pipeline Safety Improvement Act (H.R. 4849), would significantly change and increase the safety procedures for pipelines, including adding requirements that pipelines conduct regular pigging and hydrostatic testing. The bill also would give much greater power to the states in overseeing the construction of new pipes and the operation of existing pipes. In addition, it would raise sharply the penalties for any violations.

The Franks bill is similar to another piece of legislation introduced in the Senate last month by Sen. John McCain (R-AZ) (S 2438). McCain's bill already has been voted out of committee. There are several other pieces of pipeline safety legislation, including the Clinton Administration's own bill (see NGI, April 17; May 15; and June 19). It appears quite possible that pipeline safety legislation will be passed during the current Congressional session, pipeline industry officials admit.

Pipeline representatives aren't too pleased, however, with the situation. They would much rather see a simple reauthorization of the existing Pipeline Safety Act. But they believe they are making progress on the new bills and expect to see a version of the Franks and McCain bills passed.

"Probably the most important thing about this bill," said one pipeline official, referring to the Franks legislation, "is that it has a bias in favor of mandating the use of smart pigs or hydrostatic testing with respect to inspecting pipelines. We're concerned about mandating specific techniques over others. Only about 30% of our pipeline mileage can accommodate smart pigs. With hydrostatic testing, you have to take the line out of service for a while, and then you run the risk of weakening the pipeline and causing further problems down the road. It's potentially a destructive test on the pipeline, and some of the problems that you could create may not manifest themselves for a while."

The second issue pipeline officials are concerned about is having to consult with state and local officials in developing pipeline integrity plans. That requirement is in the Franks and McCain bills and is part of a new rule being drafted at the Department of Transportation. Each pipeline would have to create its own pipeline integrity program. The bill essentially would require the pipelines to consult with all the state and local governments with jurisdiction over the land they cross, which could shut down many project entirely.

"When you have several thousand political subdivisions that you have to deal with and each one wants A,B,C, and D and they are not necessarily compatible, it's a real recipe for a mess," the pipeline official noted. "What we're saying is there ought to be some process where the interests of state and local governments can be involved through an interview with the Secretary of Transportation on a specific project. That doesn't require the operator to get everybody to sign off. If everyone had to sign off, it would ensure that these things drag on forever. I think the goal should be to get these integrity plans put in place."

The bill as currently drafted also suggests that states could create their own unique pipeline oversight methods. "We're not exactly sure what that means, but it doesn't sound good," the industry official said. "If you have individual states requiring different things, it creates problems in managing the pipelines and may actually create deliverability problems as well and conflict between the states. We don't have a problem with the states being responsible for inspections where those states get permission from DOT to do that and operate under the federal guidelines. Allowing states to go beyond the federal guidelines or outside of federal oversight would cause problems."

What's worse for pipelines, particularly those cited for violations, is the bill's proposed increase in civil penalties. Certain penalties would be doubled to $1 million and others would increase to $500,000 from only $25,000 depending on the violation.

"We haven't really heard any good justification for increasing the civil penalties. We're not crazy about it but it's not a priority issue for us," the pipeline official said.

The legislation also provides an additional $500,000 in funding to expand and improve state one-call programs as well as other public awareness efforts that are aimed at preventing damage from outside forces.

The bill is co-sponsored by nine other congressmen. It has been referred to the House Commerce Committee.

Rocco Canonica

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