Rule Changes, Proposals Could Prove Significant For 2012 Underground Market

Annual Regulatory Outlook
By Stephen Barlas, Washington Editor | February 2012, Vol. 67 No. 2

The pipeline bill does require PHMSA to do a report on the remaining exemptions to One Call systems and their impact, and send that report to Congress within two years. Andy Black, president and CEO of the Association of Oil Pipelines, says, "Exemptions from One-Call requirements generally threaten pipelines, the public and the environment with excavation damage, and should be eliminated. AOPL hopes the report will motivate Congress and PHMSA to disallow remaining One-Call exemptions in the future."

Stepping up excavation enforcement
While the pipeline bill's provisions are significant, what will cause even more impact is a PHMSA proposed rule laying out the conditions states must meet if they want to prevent federal enforcement of state excavation damage laws, which would result in civil penalties against excavators. State enforcement is notably lax. The federal government was empowered to bring civil penalties in the states by the Pipeline Inspection, Protection, Enforcement, and Safety Act of 2006 (PIPES Act). However, the PHMSA has been slow to conduct the necessary rulemaking, issuing an advanced notice of proposed rulemaking in 2009 and nothing thereafter.

After dragging its feet, sources say PHMSA will issue a proposed rule this winter. The PIPES Act allows PHMSA to legally pursue excavators who "damage a pipeline" when they:

• Fail to use a One-Call system before excavating;
• Fail to regard the location information or markings established by a pipeline facility operator; and/or
• Cause damage to a pipeline facility that may endanger life or cause serious bodily harm or damage to property; and fail to promptly report the damage and fail to call 911 if the damage results in a release of pipeline products.

The AGC's Berry says: "We believe the threat of federal takeover of the enforcement programs may be sufficient incentive for many states to re-examine their One-Call laws and begin the process to update them."

Shale wastewater disposal
States are moving more quickly to update laws surrounding shale gas exploration than they are on excavation damage, given the elevated profile of that issue. The big issue now is the trucking of shale wastewater to publicly-owned treatment works (POTWs). Shale wastewater from wells in Oklahoma and Texas has been either reinjected or recycled for the past 30 years without much of a problem; that recycling and reinjection is regulated federally by the Safe Drinking Water Act.