High Consequence Areas & Pipeline Assessment Intervals –Is there a need for change?

1. High Consequence Areas & Pipeline Assessment Intervals –Is there a need for change? Terry Boss Sr. VP Environment Safety and Operations Interstate Natural Gas Association of America

2. Outline • Natural Gas and Transportation • Management of Public Risk • Results of the IMP Program • Requesting Flexibility in IMP Program Schedule • Ongoing Initiatives to Improve Performance

3. Natural Gas and Transportation • Primarily Methane – Hydrogen with some Carbon • Swamp Gas • Lower Density of Energy – Gaseous • Locations of Supply is Diverse • Locations of Market is Diverse • Transportation by Pipelines is Most Feasible • “Bridge” Fuel • Primary Risk is Fire • Lighter than Air • Limited Ignition Range • Heat Radiation based on Quantity

4. Market and Population is Dispersed

5. The Natural Gas Industry Marketers Storage Commercial Residential Industrial & Utilities • Producers • Majors • Independents Gathering Storage 30 Major Interstate Pipelines 272,500 Gas Wells 1200 Distributors

6. Interstate Natural Gas Pipelines

7. More Interstate Natural Gas Pipeline Informationwww.ingaa.org

8. Managing Public RiskNatural Gas Transmission Pipeline Safety Development

9. Pipeline Safety - Layers of Protection Example Regulations OPS 49 CFR 192/5 Codes ASME B31.4/8 Standards NACE RP-0169 & RP-0502 API RP-1163 Practices Close Internal Survey Direct Current Voltage Gradient Hydrotesting Inline Inspection Programs Integrity Management Mfg Const Internal SCC Research & Development External Corrosion Threat

10. Natural Gas Transmission Pipeline Risk Management biased by Population Density • Design • Design Classes • Materials • Strength of Pipe • Construction • Construction Techniques • Operation • Operating pressures and Practices • Inspection • Frequency and Type of Inspection • Maintenance

11. Example “High Consequence Area”

12. Worst Case Consequence Analysis

13. 660 ft. 660 ft. Constant Consequence Concept Pipeline diameter “d” (inches) = 36” MAOP 1650 psig: PIR = 1000 ft Pipeline diameter “d” (inches) = 18” MAOP 600 psig: PIR = 304 ft Pipeline diameter “d” (inches) = 30” MAOP 1000 psig: PIR = 655 ft r = 1009 ft. 20 houses within circle PIR = 0.69 pd2

14. Pictorial of a High Consequence Area for Natural Gas Overlaid on the Class Location System Houses Class 3 660 ft HCA 30” Pipeline 1010 psig 14

15. Results of the IMP Program (PHMSA) Carlsbad Number of Significant Incidents Number of Fatalities Number of Injuries Hurricanes Property Damage

16. Ongoing Performance Metrics -PHMSA

17. INGAA Foundation Report

18. Probability of Failure

19. Types Failures Static Anomalies Detrimental Non - Detrimental Time Independent Defects Excavation Damage Weather Terrorist Time Dependent Defects Corrosion Cracking

20. Manage Time Dependent Defects Manage Time Dependent Effects Inline Inspection Pressure Test Direct Assessment Other Approved Methods

21. Integrity Assessment Technology Split

22. GAO Report (Sept 2006)

23. Timeline For IMP

24. Interaction of Baseline and Continuing Assessments

25. Condition of gas transmission pipelines are better than original public perception

26. GAO concludes that 7 year reassessment period is conservative

27. Requesting Flexibility in IMP Program Schedule

28. Public Workshop to gather comments on Special Permit and Criteria Discussion for 7-year Reassessments Location: Arlington, Virginia Jan 18, 2008

29. Congressional Testimony - March 2008

30. Number of Reportable Incidents

31. Number of Immediate Repairs

32. Number of Scheduled Repairs

34. Ongoing Initiatives to Improve Performance • Tools • Processes • Procedures • Implementation

35. Cased Pipeline Integrity Assessment Workshop

36. Anomaly Assessment and Repair Workshop - October 22, 2008

37. Conclusions • Natural Gas is a Very Important Energy Source • Flexible and Readily Available • Bridge Fuel for Climate Change • Energy Security • Public Risk Can and Is Being Managed • Flexibility in the IMP Program is Very Desirable • Commitment to Ongoing Improvement

38. Background Material • COMPARISON OF INTEGRITY MANAGEMENT ASSESSMENT TECHNIQUES FOR NATURAL GAS TRANSMISSION PIPELINES • www.ingaa.org • F-2007-09 • NATURAL GAS PIPELINE SAFETY Risk-Based Standards Should Allow Operators to Better Tailor Reassessments to Pipeline Threats • www.gao.gov • GAO-06-945 • Integrity Management Plan Metrics http://primis.phmsa.dot.gov/gasimp/PerformanceMeasures.htm • PHMSA Workshops • Public Workshop to gather comments on Special Permit and Criteria Discussion for 7-year Reassessments http://www.phmsa.dot.gov/portal/site/PHMSA/menuitem.ebdc7a8a7e39f2e55cf2031050248a0c/?vgnextoid=4aeb8defc8de6110VgnVCM1000001ecb7898RCRD&vgnextchannel=5296519d7e818110VgnVCM1000009ed07898RCRD&vgnextfmt=print • Cased Pipeline Integrity Assessment Workshop https://primis.phmsa.dot.gov/meetings/MtgHome.mtg?mtg=54 • Anomaly Assessment and Repair Workshop https://primis.phmsa.dot.gov/meetings/MtgHome.mtg?mtg=55 • Congressional Hearing • The Pipeline Inspection, Protection, Enforcement, and Safety Act of 2006: Implementation Review and Discussion of Safety Reassessment Intervals for Natural Gas Pipelines; Subcommittee on Energy and Air Quality Wednesday, March 12, 2008 http://energycommerce.house.gov/cmte_mtgs/110-eaq-hrg.031208.PIPE.shtml