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Texas Watchdog: More Pipeline Oversight Needed

Texas Watchdog: More Pipeline Oversight Needed

The industry-friendly Texas Railroad Commission would do a better job of determining the fees the energy companies pay into the state's Oilfield Cleanup Fund --- but it needs to beef up its role in regulating pipelines --- according to a report by the Texas Sunset Advisory Commission. Some of the criticisms noted are expected to be corrected in pending proposals at TRC.

The Sunset commission, which watchdogs all of the state's administrative departments and then forwards its findings to the Texas Legislature for action, found that "state regulation of pipelines does not adequately protect the public," and that "the Railroad Commission does not have a clear process for determining which pipelines outside its scope of jurisdiction need safety regulation" The report noted that the Sunset commission's special investigation of Texas pipelines and gathering lines found 427 safety problems, of which 262 were in unregulated lines. Flow lines and rural gathering lines generally are exempt.

Key recommendations include requiring TRC to find a way to bring pipelines outside its jurisdiction under regulation; requiring operators to submit an assessment or testing plan; and improve its enforcement.

Texas has 280,000 miles of pipelines transporting natural gas, hazardous liquids and crude oil. Within TRC, 28 inspectors spend nearly 85% of their time inspecting natural gas lines and 15% on hazardous liquids lines, all which are supposed to be inspected every "one to three years." But because "22 persons have died and 175 have been injured" because of pipeline accidents, the report recommended that TRC use special investigations to determine pipe conditions.

"Other state agencies have developed processes to ensure compliance and enforcement consistency," said the report. However, as of November 2000, the TRC's administrative penalty schedule to determine fines for violations was only for "guidance" and not set in statute, "potentially resulting in holding some pipeline operators or owners to a different standard of accountability than others."

Earlier this year, the three TRC commissioners unanimously approved Chairman Michael Williams' pipeline proposals, which will require more integrity management of pipelines, enforcement and specialized safety audits. The proposals have not yet been enacted.

At the time, Williams said that "safety must be our number one priority." He said TRC's proposal will "raise the bar for pipeline safety," with more inspections and more stringent enforcement.

In other findings, the review determined that Texas law does not "effectively ensure the financial assurance of oil and gas operators and producers, potentially leaving the state liable for pollution and abandoned wells." Also, TRC is limited in its ability to plug abandoned wells and clean oil field sites. The report suggested two things: don't allow any more abandoned wells, and second, devote more resources to cleaning up the ones already there.

The Sunset staff, comprised of government, industry and academic representatives, had been pressured by citizens groups and legislators to consider reducing TRC's power by consolidating or transferring some of its functions to other departments. While the report noted that "opportunities exist," each of the options has drawbacks. "As a result, the agency and its programs continue to perform essential functions and should be continued."

Overall, the report was favorable toward the TRC, recommending that it continue for another 12 years in its mission, which is "to protect the state's natural resources, the environment and public safety through the regulation of the oil and gas industry, pipeline transporters, natural gas utilities, rail safety and surface mining."

Public hearings on the report are scheduled for Dec. 12 and 13 in Austin. To access the report or to learn more about the public hearings, visit www.sunset.state.tx.us, or call the Sunset Advisory Commission at (512) 463-1300.

Carolyn Davis, Houston

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