U. S. Department of Transportation Pipeline and Hazardous Materials Safety Administration

1. U. S. Department of Transportation Pipeline and Hazardous Materials Safety Administration www.dot.gov

2. PIPES Act of 2006: PHMSA’sTop 10 Priorities Arkansas PSCPHMSA T&Q UpdateLittle Rock, ARJune 20, 2007Presented by John A. Jacobi, P.E.Community Assistance & Technical Services ManagerSouthwest Region

3. Outline • Mission Statements • List of Top 10 (+1) • Item-by-Item Description (as of 2/20/07) • The 11th Item • Bonus Information

4. OPS Mission Statement “To ensure the safe, reliable, and environmentally sound operation of the Nation’s pipeline transportation system.”

5. CATS MissionStatement “To advance public safety, environmental protection and pipeline reliability by facilitating clear communications among all pipeline stakeholders, including the public, the operators and government officials.”

6. List of Ranked Priorities • (§25) Gas Integrity Management Reassessment Interval • (§6) Enforcement Transparency • (§5) Information Grants to Communities • (§4) Low Stress Pipelines • (§22) Hazardous Liquids (HL) Internal Corrosion Control Regulations

7. List of Ranked Priorities(continued) • Three Items: • (§9) Distribution Integrity Management & Emergency Flow Valves • (§12) Control Room Management • (§19) SCADA Standards • (§16) Executive signature of Integrity Management Performance Reports

8. List of Ranked Priorities(continued) • (§21) Leak Detection Technology Study and Report to Congress • (§8) Hazardous Liquid Pipeline Capacity and Regulatory Adequacy Study (“Market Study”) • (§17) Cost Recovery – LNG Design Review • (§2) State One-Call/Damage Prevention Programs

9. 1. Gas Integrity Management Reassessment Interval • Review/comment on GAO report. Send to Congress legislative recommendations for implementing report conclusions. • Statutory deadline and stakeholder interest by INGAA drive the urgency. We have the authority to issue waivers and are prepared to do so, and are streamlining the process by bundling waivers by topic. • Draft Prepared – goal to finish by end of March

10. 2. Enforcement Transparency • Post monthly summary of pipeline enforcement actions for the public to include identification of operators involved in enforcement actions, the types of alleged violations, and any penalties or proposed penalties. Also requires mechanism for operators to make responsive information available to the public. • Underway. Will use website. Meeting with Stakeholders. Will seek public comment. Complete by end of 2007.

11. 3. Information Grants to Communities • Grants to local communities, including three $25,000 demonstration grants, to promote local community awareness and understanding of pipeline safety activities in their area. • Working on criteria. Pilot in Alaska. Create partnerships between operators & communities. Improve understanding of company performance by using well chosen broadbased metrics that are transparent and close to real time. No specific deadline.

12. 4. Low Stress Pipelines • Issue regulations– Two Phases: (I) High Consequence Areas [HCAs] and (II) non-HCAs • PHMSA’s top regulatory priority. Get protection to highest risk areas (HCAs) first, and will likely take a phased approach to bringing in the rest of the low stress (non-HCA) pipelines. HCA lines by end of 2007 – no specific schedule for remaining lines.

13. 5. Hazardous Liquids (HL) Internal Corrosion Control Regulations • Review adequacy of 49 CFR Part 195 (HL) internal corrosion control regulations. Submit report to Congress containing results of the review and modify regulations if necessary/appropriate • Complete prior to completing the low stress rulemaking - second phase, so that any improvements in regulation, for example, cleaning and continuous monitoring, are defined prior to the final rule on the low stress pipelines outside high risk areas. SW Region – complete by end of 2007.

14. 6A. Distribution IMP • Prescribe minimum standards for distribution IMP. Require gas distribution pipeline operators to develop/follow a written plans to include evaluation of systems, identification of threats potentially affecting the system, implementation of measures to mitigate risks, and ongoing performance monitoring. • Largely based on findings from the DIMP team of stakeholders. Proposed rulemaking by end of 2007.

15. 6A. Excess Flow Valves • Develop regulations to require gas distribution operators to install EFVs in certain circumstances and annual reporting on the number of installed EFVs. • The new EFV requirement (PIPES 2006) has necessitated changes in previous thinking, but the proposed rulemaking should be published this summer to take effect about a year later.

16. 6B. Control Room Management • Issue regulations requiring operators to develop/implement and submit for approval a human factors management plan, including a maximum limit on hours of service for controllers.

17. 6B. Control Room Management • This newly required plan to may be appended to the existing Part 192 IMP requirements – pipeline infrastructure, people and plans and procedures are what make up integrity management– this element is part of the system of Prevention through People. PHMSA will have discussions with stakeholders on concept soon, as next step.

18. 6C. SCADA Standards • Issue standards implementing three NTSB recommendations on the operation of Supervisory Control and Data Acquisition systems (SCADA), including: (1) use of graphics on SCADA; (2) review and audit of alarms on monitoring equipment; and (3) pipeline controller training. • Will be addressed with 6B. Control Room Management, above.

19. 7. Executive Signature of IMP Reports • Establish procedures requiring certification of pipeline IM performance reports filed by a senior executive officer of the company. • Will be implemented by an Advisory Bulletin. Rulemaking not required. Should be done quickly.

20. 8. Leak Detection Technology Study and Report to Congress • Study the effectiveness of leak detection systems utilized by operators of hazardous liquid pipelines. Provide report toCongress. • This study will be primarily based on assessment of IMP inspections and will include recent research findings.Shooting for end of 2007.

21. 9. “Market Study” • Requires PHMSA and DOE to perform periodic analyses of hazardous liquid pipeline transportation to identify capacity restrictions that could cause shortages of petroleum products or price disruptions in the event of pipeline failures. Report to Congress. • Meetings with DOE have begun, but this project may be delayed until FY08 due to the CR.Finish by June 2008.

22. 10. Cost Recovery- LNG Design Review • Authorizes recovery of staff costs associated with performing a design review for a proposed LNG facility project directly from the project applicant. • PHMSA is beginning to look at implementation options to collect fees from operators with designs of facilities for us to review this year and next. No set deadline.

23. 11. State One-Call/Damage Prevention Programs • Did not make the “Top 10” but nonetheless very significant to some stakeholders • §2 of PIPES requires excavators to “call-before-you-dig”, observe pipeline markings, report damage to the operators of pipelines and use 911 if there is a leak or fire. • Most states do not have effective enforcement of damage prevention laws

24. 11. State One-Call/Damage Prevention Programs • §2(f) of PIPES requires PHMSA to develop and issue through rulemaking criteria for “determining inadequate State enforcement of penalties.” • A draft white paper based on CGA Compliance Best Practices has been developed and circulated internally within PHMSA • An ad hoc team is rumored to be in the works. This team will include many stakeholders. No set schedule

25. Bonus Information The best place to get most recent 49 CFR Parts 190 – 199 and 49 CFR Part 40 (Alcohol & Drug Abuse Regulations) is http://ops.dot.gov/training/index.htm • click on “Regulatory Information” • click on the part you want

26. Questions ???Thank You!! john.jacobi@dot.gov 281-685-7128 (cell) 713-272-2839