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Congress Passes New Bill Aimed at Pipeline Safety

After nearly a year of discussions in both chambers, the U.S. Congress passed the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011 (HR 2845) and presented it to the President on Dec. 23, 2011. The proposed changes would greatly increase the review and oversight of pipeline systems and pipeline safety requirements. Some of the major provisions include:

  • Additional requirements imposed on pipeline owners and operators:

    • The Act requires pipeline owners/operators to verify records for accurate contents relating to physical and operational characteristics and to confirm the maximum allowable operating pressure (MAOP) for pipes located in High Consequence Areas as well as Class 3 and Class 4 areas. In situations where the pipeline records are inadequate to confirm the MAOP, the owner or operator must “reconfirm a maximum allowable operating pressure as expeditiously as economically feasible; and . . . determine what actions are appropriate for the pipeline owner or operator to take to maintain safety until a maximum allowable operating pressure is confirmed.” 49 U.S.C. § 60139(c). This process can be costly. In addition, all exceedances of the MAOP in each segment of a pipeline must be reported to the appropriate authority within five days after the exceedance occurred.

    • The Act extends to FY2015 the authorization of the Pipeline Safety Improvement Act of 2002. The fees collected under 49 U.S.C § 60301 (pipeline user fees) totaled $90.7 Million. The Act also establishes a Pipeline Safety Design Review Fund in the Treasury.

    • Applicants seeking a waiver of a pipeline safety requirement under 49 U.S.C. § 60118(c) or (d) are no longer entitled to judicial review of a waiver denial.

    • Within two years of enactment, regulations are to require the use of automatic or remote controlled shut-off valves for new transmission pipelines “where economically, technically, and operationally feasible.”

  • Increases the penalties for violations of pipeline safety requirements:

    • Civil penalties for violating pipeline safety rules were increased from $100,000 per day/$1 million maximum for a series of violations to $200,000 per day/$2 million maximum for a series of violations. The Act defines a “major consequence violation” to be an incident resulting in one or more deaths or injuries or illnesses requiring hospitalizations and environmental harm exceeding $250,000 in damages.

    • The administrative penalty caps which limit the amount of civil penalties that can be sought in administrative enforcement proceedings are not applicable to civil penalties issued under 49 U.S.C. § 60120 for pipeline transportation and pipeline facility safety violations.

    • USDOT has authority to seek civil penalties against persons that interfere and/or obstruct an inspection or investigation.

  • Requires pipeline safety-related studies:

    • PHMSA must conduct a study on the status of cast iron pipe replacement every other year.

    • PHMSA must conduct a study on the impacts pipeline safety has on damages experienced by third parties.

    • PHMSA is to analyze whether integrity management programs should be expanded beyond high consequence areas and whether the expansion of the integrity management programs would reduce the need for class location requirements.

    • The Secretary of Transportation is to review and report on the sufficiency of safety regulations for gas and hazardous liquid gathering lines both onshore and offshore, including the inlets of the Gulf of Mexico, within two years of the effective date of the Act.

    • PHMSA must conduct a study on the technical limitations of current leak detections systems, with an emphasis on the ability to detect ruptures and small leaks for high consequence areas.

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About this Author

Fredric Andes Environmental Attorney
Partner

Fredric P. Andes is a partner in the Chicago and Washington, D.C., offices of Barnes & Thornburg and the leader of the firm's water team. Fred is involved in counseling and litigation on issues arising under various federal and state environmental laws, with a special emphasis on Clean Water Act matters.

Fred is involved in clean water issues on the national and state levels. He was selected by the EPA to serve on the Federal Advisory Committee on the Total Maximum Daily Load (TMDL) Program. He is serving as coordinator for the Federal Water Quality Coalition, which is a group...

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Paul Drucker Environmental Attorney
Partner

Clients call on Paul Drucker to handle high-profile litigation and appeals, complex internal investigations concerning environmental incidents, environmental due diligence for corporate and real estate transactions, and regulatory compliance matters and settlements.

Paul is adept at helping clients develop comprehensive legal strategies that take into account their business operations, their commercial interests and their desire to be in compliance with applicable statutes and regulations. Paul’s ability to analyze and streamline complex problems and develop understandable and practical solutions is highly valued by the firms’ clients.

As a member of the firm’s nationally recognized Environmental Law department and its Water Law, Litigation and Appellate teams, Paul represents corporate clients in complex commercial and environmental litigation and arbitration. Paul’s substantial experience in motion practice includes dispositive motion writing and oral argument in state and federal courts throughout the country. He has resolved a wide array of contract, product liability, fraud, toxic tort and related matters, as well as cases involving CERCLA, RCRA, CWA, CAA and other federal and state statutes. Paul also works with municipal wastewater treatment plants in various jurisdictions on complicated compliance and litigation issues.

He regularly drafts federal appellate briefs involving complex environmental issues and was the principal author of a Petition for Writ of Certiorari to the U.S. Supreme Court concerning Clean Water Act issues that received national media attention.

As the founder and leader of the firm’s Pipeline practice team, Paul advises major oil companies and pipeline operators regarding pipeline siting and installation, integrity management issues, pipeline safety regulations, leak response, crisis management, environmental remediation and investigations into pipeline and refinery incidents. He interacts with PHMSA, USCG, EPA and other state and federal regulatory authorities regarding response activities, legal claims, and environmental impacts arising from pipeline and refinery releases.

In addition, Paul counsels major corporations on environmental, health and safety issues in regional, national and international business transactions, including mergers, acquisitions, stock purchase agreements, divestitures and real estate transactions. He frequently manages environmental due diligence, oversees environmental investigations and negotiates environmental provisions in transaction documents. Paul has been involved in a number of high-profile multimillion and multibillion dollar transactions and M&A deals.

Prior to joining Barnes & Thornburg, Paul practiced environmental law and complex commercial litigation at Mayer Brown LLP in Chicago.

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Tammy Helminski, Barnes Thornburg Law Firm, Grand Rapids, Environmental Law Attorney
Associate

Tammy L. Helminski is an associate in the Grand Rapids office of Barnes & Thornburg, and a member of the firm’s Environmental Law Department. Ms. Helminski has experience with environmental due diligence and risk evaluation, project management of large-scale remediation sites involving numerous parties, and assisting manufacturing and developer clients with environmental auditing and compliance. Her litigation experience includes representing clients in cases involving CERCLA, NEPA, RCRA and NREPA, as well as product liability, mold, asbestos, construction and contract litigation...

616-742-3926