Lower Prices, Consumption, Near-Term Construction Lessens 2010 Spending Levels

By Rita Tubb, Managing Editor | February 2010 Vol. 65 No. 2
VESTAMID PA12 pipe ends are shown being jointed using heat fusion.

Respondents reporting costs for finding and repairing leaky mains consistently said that costs varied widely depending on location, street vs. lawn. While 43 percent of those surveyed cited surface location as a major cost factor, 33 percent of these same respondents gave $1,500 as an average finding and repair cost while the remaining 10 percent gave $2,000 as an average cost.

Of those reporting finding and repair costs per occurrence, regardless of size, the following were given as the highest costs: $855 to $2,850. Those reporting costs by size provided the following: 2-inch $1,000 - $2,420; and 4-inch, $1,800 to $2,500.
One gas utility with 100,000 customers indicated that most of its gas leaks occurred in 2 to 4-inch coated cast iron pipe that was located under pavement. They placed finding and repair costs as averaging $1,800 per leak.

Annual Mileage for Natural Gas Distribution Pipelines. Historical totals may change as PHMSA receives supplemental information. Source: PHMSA/Office of Pipeline Safety.

A small gas utility with 6,000 customers that provided costs by pipe diameter provided the following as its average finding and repair costs for leaking mains: 2¼ to 2½-inch $1,300 per leak; and 4-inch, $1,500 per leak.

Integrity management
Response to this question clearly illustrates the uncertainty the LDC feels regarding PHMSA’s proposed rule to establish integrity management for gas distribution pipeline systems. More than 75 percent of those surveyed said they expected the rule to be far more costly for the LDCs and ultimately the customer than the PHMSA has suggested.

Several LDCs indicated they did not expect increased costs in the field, but they did anticipate added costs to prepare extensive documentation, plus the potential for software and hardware upgrades and additional administrative personnel.

A sizeable portion of this year’s recipients indicate that contractors continue to provide a major portion of new distribution construction to install gas utilities. Figures indicate that 85 percent rely on contractors to carry out 85-100 percent of all new construction on projects, while 10 percent indicate they relied on contractors to perform 20-70 percent of this work. Of the remaining 5 percent, 3 percent indicated they didn’t use contractors at all and the remaining 2 percent reported using contractors to perform 20-35 percent of their work.