The natural gas pipeline integrity rule, which would require interstate and intrastate pipes to periodically inspect their systems using smart pig technology, could cause large portions of the transportation grid to be down in the years ahead and would further “aggravate” what is shaping up to be a tight gas supply situation, said a top official of the Interstate Natural Gas Association of America (INGAA).

It will require a “significant amount of work to accommodate [pipeline] systems” for smart-pig inspections, said Terry Boss, INGAA senior vice president of environment and safety. “This is unprecedented,” he noted, adding that the mandated inspections of both interstate and intrastate gas pipelines will “probably aggravate” the supply-demand imbalance.

Some inspections are being done right now, and “we are seeing the affects on daily spot prices,” Boss told NGI. This “will be accelerating at a high rate” in the months and years ahead. Most affected will be industrial, commercial and power generation customers, he believes.

The pipeline safety integrity rule, which the Department of Transportation Office of Pipeline Safety (OPS) is expected to finalize next December, would require pipelines located in high-population density areas to do initial inspections by 2012, and then re-inspect their systems within seven years.

Boss said the amount of pipes covered by the rule (located in high-population density areas) makes up 5% of the entire U.S. gas interstate and intrastate transmission grid. But because that 5% is scattered throughout the entire grid, in order to inspect those pipes with smart pigs or other in-line technology could require similar inspections for up 60-80% of the grid. He noted that only 25% of the U.S. pipeline grid currently has the capability to conduct in-line inspections.

He foresees a reduction in pipeline capacity availability as a result of the mandated inspections, particularly in the first 10 years of the OPS program.

Making matters worse, Boss believes, is the fact that the pipeline inspections “will probably not” be coordinated to avoid a number of pipeline systems being down at the same time. Pipelines are “precluded from doing a lot of [advance] communication” with their competitors to prevent such a situation, he said.

There also is a “heavy controversy” between gas pipelines and the Research & Special Programs Administration (RSPA), which oversees the OPS, over the required timing for pipe inspections under the new pipe-safety law. Pipes have interpreted the law to mean they must have initial inspections completed by 2012, and re-inspections done by 2019. But the RSPA believes that if a pipeline does an inspection, for example in 2004, it then should complete its re-inspection by 2011 at the latest, Boss said.

The RSPA refused to allow a federal advisory group to the OPS, the Technical Pipeline Safety Committee, to settle the dispute over the so-called “overlap” issue because it believes it involves a legal issue, according to Boss. The advisory group, however, recently did accept a “significant amount of positions we had taken” that will lead to a “considerable reduction” in costs for pipeline operators and consumers, he said.

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