Prices Ease as 700 MMcf/d Resumes Flow on El Paso's South Line

Less than two weeks after the deadly explosion on El Paso Natural Gas' system in southeastern New Mexico, the pipeline on Friday had more than 700 MMcf/d of capacity restored to its South Mainline, which is designed to feed a total of 1.1 Bcf/d to markets between Texas and California.

At mid-day Friday (Mountain time), El Paso said it began running about 260 MMcf/d through Line 1100 after it received the go-ahead from the federal Office of Pipeline Safety (OPS), according to company spokeswoman Kim Wallace. El Paso was able to re-start partial service on the 26-inch line after it built a 16-inch temporary connector line between Line 1110 and Line 1100, which was approved by OPS.

The temporary connector was installed just east of the Pecos River explosion site, about 30 miles from Carlsbad, NM. Wallace said Line 1100 would carry the gas from Eunice, NM, just Northeast of the Pecos River Compressor Station, to the connector with Line 1110, which then would transport it westward across the Pecos River Bridge where it would meet up with Line 1100 further downstream. Meanwhile, Wallace said El Paso submitted to OPS last week the test results and a preliminary return-to-service plan for Line 1100.

Three days prior, the OPS had given El Paso permission to restore service to parallel Line 1110 from the Keystone Station through the Pecos River Compressor Station at a reduced level. The pipeline re-opened the line at about 400 MMcf/d, and gradually increased it to 480 MMcf/d by Friday. This is "still within the limits it [OPS] set" for Line 1110, Wallace said.

The OPS restricted El Paso's Line 1110 to 80% of the operating pressure of Line 1103 at the time it ruptured, according to Department of Transportation Spokeswoman Debbie Hinz. She said this put the line at a pressure of about 538 pounds per square inch.

The OPS-ordered shutdown of Line 1110 lasted 10 days, during which the agency ordered El Paso to conduct extensive hydrostatic, ultrasound and X-ray tests to determine their safety, and to submit a plan for restoring service to the line.

As for the future of Line 1103, which is the line that ruptured, Wallace said repairs on it would not begin until after the investigation of the explosion is completed, which will "probably be nine to 12 months."

The restoration of service couldn't come soon enough for El Paso customers who have been scrambling for transportation capacity ever since federal investigators and regulators closed down the three lines that make up El Paso's South Main leg in the wake of the blast that killed 11 people and critically injured one. El Paso and some of its California customers have been using gas from storage to meet their gas needs during the service interruption. The Department of Energy has set up a task force to evaluate the effects of the explosion and shutdown on the gas market.

As service was being re-started on the disabled lines, California border prices began falling last week. When the OPS first announced the shutdown of the three lines on El Paso South Mainline in late August, Southern California border basis got as high as plus 260-65, putting some fixed prices in the $7.20s. But with the resumption of partial service on Line 1110 last week, the price slid back down. NGI's Southern California Border Index for September was $6.31/MMBtu.

Meanwhile, the fallout from the deadly Aug. 19 explosion last week was building nationwide and is likely to intensify.

All eyes will be on Congress this week as it returns from its August recess to see what it will do with the pipeline safety reauthorization bills pending before it. Many observers, including pipeline officials, believe lawmakers will move to put even more teeth in the legislation in the wake of what is being called the deadliest gas pipeline explosion in more than a decade, and will pass a bill before they adjourn for the year.

Last week, the OPS issued an industry-wide bulletin advising operators and owners of gas transmission pipelines to review their monitoring programs and operations for detecting the presence of internal corrosion on their systems. The OPS took this action after it and the National Transportation Safety Board (NTSB) said they had found corrosion inside the El Paso South Mainline pipeline (Line 1103) that ruptured.

Also, the first civil lawsuit was brought against El Paso Natural Gas last week, accusing the pipeline of negligence in failing to properly maintain and operate its system. The suit seeks undetermined damages.

As for the advisory bulletin, the OPS said its review of incident reports and inspections "indicated that better industry guidance is needed to determine the best practices for monitoring the potential for internal corrosion in operator pipelines."

It advised gas pipelines to refer to the recommended corrosion-monitoring practices of the national consensus standards organizations, including the American Petroleum Institute, the National Association of Corrosion Engineers, and the Gas Piping Technology Committee (GPTC). The OPS said that the GPTC is considering modifying its "Guide for Gas Transmission and Distribution Piping Systems" to address design considerations, corrective measures and detection techniques for internal corrosion.

It recommended that gas pipelines give "special attention" to a number of specific conditions, including flow characteristics, pipe location (especially drips, deadlegs and sags, which are on-line segments that are not cleaned by pigging or other methods), fittings and/or "stabbed" connections which could affect gas flow, operating temperature and pressure, water content, carbon dioxide and hydrogen sulfide content, carbon dioxide partial pressure, presence of oxygen and/or bacteria, and sediment deposits.

The OPS further urged gas pipelines to focus their review on segments downstream of gas production and storage fields, where it said corrosive elements most often accumulate. Also, "review conditions in pipeline segments with low spots, sharp bends, sudden diameter changes, and fittings that restrict flow or velocity, and segments in unusual terrain. These features can contribute to the formation of internal corrosion by allowing condensates to settle of the gas stream."

But industry downplayed the incidence of internal corrosion in pipelines. Internal corrosion on large-diameter, long-distance pipelines is rare, according to an "Analysis of Internal Corrosion Incidents" issued by the Interstate Natural Gas Association of America (INGAA).

The consulting firm Kiefner & Associates reports that of 1,376 total incidents on transmission and gathering pipelines filed with the OPS since July 1984, only 180 incidents (13.1%) were caused by internal corrosion, the INGAA analysis said. Of those, 18 (1.3%) occurred on long-distance pipelines of 24 inches or more in diameter, and there were no injuries or fatalities.

El Paso has had 40 ruptures on its pipeline system since 1984, many of which were due to third-party damage and only a few to corrosion, according to DOT's Hinz. Prior to 1984, an explosion in 1975 on El Paso led to three fatalities, and another fatality was reported in a 1973 incident, she said. The cause of the 1975 incident was internal corrosion, according to DOT, while the 1973 blast was due to a leak in a valve.

Last Tuesday, Jennifer Smith, a Carlsbad, NM, resident, filed a wrongful death lawsuit in U.S. District Court in Albuquerque on behalf of her husband, Bobby Earl Smith, who died two days after the Aug. 19 blast in a Lubbock, TX, hospital.

Others who died as a result of the explosion on El Paso's South Mainline were Bobby Smith's two adult children, a son-in-law, five grandchildren and his daughter-in-law's parents. The sole survivor is his daughter-in-law, Amanda Smith, 25. She remains in critical condition at the University Medical Center in Lubbock. Funerals for the dead were held last weekend.

The 11 victims were "picnicking, fishing and recreating in a lawful manner in an area adjacent to the El Paso pipeline" when one of three lines that make up El Paso's South Mainline ruptured, causing the explosion and fireball, the lawsuit said.

The lawsuit seeks undetermined damages for "personal injury and wrongful death," and punitive damages from "El Paso, their agents, employees and representatives" for their "willful, wanton and careless conduct and utter disregard and utter indifference in this matter," and to "deter and punish the defendant in the future."

Although the lawsuit names El Paso as the sole defendant now, it could be expanded in the future. "I think as the investigation proceeds and further acts of negligence are uncovered, that certainly could open the door for additional defendants to be named, and those defendants might be corporate defendants," said a lawyer close to the lawsuit.

There is no criminal investigation into the accident at this time. "I think that is very preliminary.....There could be circumstances which one would personally feel that criminal actions might be necessary. I don't know if it would be appropriate under the law, and I certainly don't think it's appropriate at this time. But when something this horrible happens.....you really think along those lines," the lawyer noted.

Nor is OPS considering a fine against El Paso at this time, as it did with Olympic Pipeline in the Bellingham, WA, explosion that killed three. "I have not heard a word about it. That doesn't mean it would never happen," said DOT's Hinz.

Specifically, the civil lawsuit accuses El Paso of failing to "properly comply with state and federal rules, regulations, opinions and orders while operating an interstate gas transmission line" at or near Carlsbad.

Moreover, it said El Paso "was negligent in failing to properly inspect, maintain and operate their interstate gas transmission line at all times." The transmission of natural gas "is an ultra-hazardous activity and undertaking," the lawsuit noted, adding that El Paso's failure to provide "the highest degree of care and.....safety" to persons in the vicinity of its system makes it "strictly liable" to Bobby Smith and the others who died or were injured as a result of the explosion.

The lawsuit is being handled by two law firms: The Branch Law Firm in Albuquerque, NM, and Baker, Brown & Dixon in Arlington, TX.

Susan Parker

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