Pipeline Citing Bill Passes House; Tough Senate Battle Lies Ahead

January 2014, Vol. 69 No. 1

Gas transmission companies are trying to convince federal regulators to use integrity management guidelines to determine when pipe needs to be replaced outside high consequence areas (HCAs). The 2011 pipeline safety law requires the Pipeline and Hazardous Materials Safety Administration (PHMSA) to decide whether an expansion of the integrity management (IM) program beyond high consequence areas would eliminate the need for the class location system.

The PHMSA issued a proposed rule last August, and extended the comment deadline once. It is now chewing over input from operators, customers and public interest groups. The proposed rule raised a number of inter-related issues: 1) whether the IM program should be extended beyond HCAs, 2) if so, should new HCAs be designated based on IM principles or class location, 3) if class locations are to remain, should transmission companies be given new leeway to maintain pipe even if the class location in an area increases.

The 2002 IM program specifies inspection, repair and reporting requirements for pipeline segments in high population areas. Operators use a calculation – called the pipeline impact radius (PIR) – to establish which segments are in HCAs. That calculation is dependent on the maximum allowable operating pressure (MAOP) of the pipeline and its diameter.

The class location system divides areas on each side of a pipeline up to 660 feet into four classes (1-4), depending on population density, and prescribes operating pressures and pipeline thicknesses within each category to provide a margin of safety. As population inside the class increases, pipelines may have to reduce pressure or replace pipe.

The pipeline industry believes the class location requirement to replace pipe is often unjustified. Class location does not rely on the operating character of the pipeline. That can overestimate or underestimate the consequences of a pipeline accident, according to the Interstate Natural Gas Association of America (INGAA). PIR adjusts as pipeline pressure and size change.

The industry is also concerned that PHMSA is using class locations to qualify what it is calling “moderate consequence areas” governed by a new Integrity Verification Process (IVP). Companies would have to verify characteristics such as maximum allowable operating pressure (MAOP) and construction materials for what are called "grandfathered" pipelines – i.e. those pre-1970 for whom MAOP was never established.