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Pipeliners Podcast host Russel Treat hosts an informative episode dissecting the new Gas Gathering Rule that is advancing through the PHMSA rulemaking process.

Find out what you need to know about the rulemaking timeline, what is covered under the new rule, the types of lines that will be brought under the new rule, the importance of area classification, and the effect of the U.S. government shutdown on the rulemaking process.

Gas Gathering Rule: Show Notes, Links, and Insider Terms

  • PHMSA (Pipeline and Hazardous Materials Safety Administration) ensures the safe transportation of energy and hazardous materials.
    • The Control Room Management (CRM) Rule includes two parts: PHSMA rule 49 CFR 192 that pertains to the transportation of natural and other gas by pipeline and PHSMA rule 49 CFR 195 that pertains to the transportation of hazardous liquids by pipeline.
  • The Gas Gathering Rule (Safety of Gas Transmission and Gathering Pipelines) was initiated in 2016 when PHMSA issued a notice seeking comments on changes to the pipeline safety regulations for gas transmission and gathering pipelines. The proposed rule has advanced through various stages to expected issuance in March 2019.
    • NPRM (Notice of Potential Rulemaking) invites stakeholders to submit comments and feedback on a proposed rule.
    • ANPRM (Advance Notice of Proposed Rulemaking) is a federal agency’s method to deliver their proposed rule change following a period of commentary and feedback from stakeholders.
    • NARM (Notice of Approved Rulemaking) is the approved final rule that will be rolled out in a series of phases.
  • GPAC (Gas Pipeline Advisory Committee) is organized by PHMSA to review their proposed regulatory initiatives to assure the technical feasibility, reasonableness, cost-effectiveness, and practicability of each proposal.
  • NAPSR (National Association of Pipeline Safety Representatives) is a national association that represents U.S. state pipeline safety personnel through a partnership with the U.S. Department of Transportation. NAPSR members have oversight responsibilities for the safe and reliable transportation of natural gas and hazardous liquids through pipelines.
  • MAOP (maximum allowable operating pressure) was included in a bulletin issued by PHSMA informing owners and operators of gas transmission pipelines that if the pipeline pressure exceeds MAOP plus the build-up allowed for operation of pressure-limiting or control devices, the owner or operator must report the exceedance to PHMSA on or before the fifth day following the date on which the exceedance occurs. If the pipeline is subject to the regulatory authority of one of PHMSA’s State Pipeline Safety Partners, the exceedance must also be reported to the applicable state agency.
  • SMYS (Specified Minimum Yield Strength) is a measurement of a pipe’s strength, as determined by the manufacturing specifications of the pipe.
  • Gathering Line types include Type A and Type B.
    • Type A: Metallic and the MAOP is more than 20% of SYMS, or non-metallic and MAOP is more than 125 psig.
    • Type B: Metallic and the MAOP is less than 20% of SYMS, or non-metallic and MAOP is less than 125 psig.
  • Integrity Management (Pipeline Integrity Management) is a systematic approach to operate and manage pipelines in a safe manner that complies with PHMSA regulations.
  • PIR (Potential Impact Radius) is defined by PHMSA (49 CFR subpart 192.903) as the radius of a circle within which the potential failure of a pipeline could have significant impact on people or property.
  • Class location is an onshore area that extends 220 yards on either side of any continuous 1 mile of pipeline. Also, each unit in a multi-unit building is counted as a separate building. [View this detailed presentation on how to determine class location.]
    • Class 1: Offshore, or has 10 or fewer buildings for human occupancy (e.g., rural).
    • Class 2: More than 10 buildings, but less than 46.
    • Class 3: More than 46 buildings; or an area where the pipeline lies within 100 yards of a place where people gather (20 or more people, at least 5 days a week for 10 weeks in any 12 month period).
    • Class 4: Buildings with 4 or more stories above ground are prevalent.
  • The new Gas Gathering Rule covers the following classifications:
    • Type A in Class 2, 3, or 4.
    • Type B in Class 3 or 4.
    • Original: Type A in Class 1 — diameter greater than or equal to 8.625.
    • In discussion: Type A, Class 1 diameter > 12.75 and at least one dwelling, or Class 1, and greater than 16”.
  • The Pipeline Safety Trust (PST) is a public charity promoting pipeline safety through education and advocacy by increasing access to information, and by building partnerships with residents, safety advocates, government, and industry.
  • GAO (Government Accountability Office) is a legislative branch government agency that provides auditing, evaluation, and investigative services for the United States Congress.
  • IPAA (Independent Petroleum Association of America) is a national trade association in Washington, D.C. that serves as an informed voice for the exploration and production segment of the oil and gas industry. IPAA advocates member views before the United States Congress, The White House, and federal agencies.

Gas Gathering Rule: Full Episode Transcript

Russel Treat:  Welcome to the Pipeliners Podcast, episode 64, sponsored by EnerSys Corporation, providers of POEMS, the Pipeline Operations Excellence Management System, compliance, and operation software for the pipeline control center. Find out more about POEMS at enersyscorp.com.

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Announcer:  The Pipeliners Podcast, where professionals, Bubba geeks, and industry insiders share their knowledge and experience about technology, projects, and pipeline operations. And now, your host, Russel Treat.

Russel:  Thanks for listening to the Pipeliners Podcast. Appreciate you taking the time. To show that appreciation, we’re giving away a customized YETI tumbler to one listener each episode. This week, our winner is Jon Sosa, with Jayhawk Pipeline. Congratulations, Jon, your YETI is on the way.

In this week’s episode of the Pipeliners Podcast, I’m actually going to put together a little bit of my homework and a podcast. Let me tell you what that means. I’m having to do some work, to do some research, and get up to speed on the gas gathering rule that’s making its way through the PHMSA rulemaking process.

As I was going through this, I thought it was something that might be interesting to the listeners. Because of that, I decided it would be a good idea to just do the research, organize my thoughts, and pull together a podcast.

Hopefully, this will be something that’s interesting and useful to the listeners. I want to start with just talking a little bit about PHMSA and how it goes through its rulemaking process. Generally, rulemaking is initiated by some kind of event, something like a pipeline accident, or other type of thing that gathers enough public interest to get itself elevated to the rulemaking level.

The gathering rule has been coming for some time. To some degree, it’s coming out of some work done by the general accounting office. The bottom line is, this rule’s making its way through the process. When a rule originally gets proposed, PHMSA issues an Advance Notice of Proposed Rulemaking.

If you’re going through PHMSA stuff, you’ll see that by its acronym, which is ANPRM. Then after a period of public commentary, and to discern if there’s enough support and if PHMSA has the appropriate authority, then that advance notice will become a Notice of Proposed Rulemaking.

Once something is a Notice of Proposed Rulemaking, it’s put out in the federal register. You can get to it through the web and read it. Then there’s a period of time for people to make comments about that. We’re through all of that process as it relates to the gathering rule.

Typically, what PHMSA will do is, once it has a Notice of Proposed Rulemaking, and it’s been through the commentary process, the last thing that it does is, it takes these rules to their technical advisory committee.

PHMSA has two technical advisory committees. There’s one for natural gas pipelines, and there’s another for liquid pipelines. They have the opportunity to provide commentary and actually vote on the rules.

What this does is it gives industry and the public an opportunity to be involved in the rulemaking process. It’s part of how our government actually works. The gas gathering rule was originally scheduled to be in front of the Gas Pipeline Advisory Committee in January.

The government shutdown caused it to be pushed out. The documents that were prepared for presentation in January have already been pushed out on the PHMSA website, so we have an opportunity.. that normally only happens a week or two before one of these advisory committee meetings. We have an opportunity to actually grab that documentation, look at it, and get some idea of where is the rule, and where might it land?

I’m not going to talk about all the requirements and the specifics of the requirements that are in the rule for gathering lines. I’m going to talk more about what lines are going to be brought in underneath the rule.

I’ll leave it for the listeners to make up what this means. Bottom line is, for these rules that get brought into the gathering rule, they’re going to fall under all the requirements that the gathering lines have historically fallen into.

There’s a bunch of requirements in here where they’re going to run these lines more like transmission lines. What’s the basis for this? If you think about what a gas gathering line looks like, in terms of its pressure and size, even 10 years ago, before the shale boom took off, versus what it looks like now, it’s a very different animal.

In the shale places, particularly the Utica and the Marcellus, what you’re seeing gathering lines that are 16 inches and larger, and operating pressures that are in the 1,200, 1,400, and larger operating pressures.

Those kinds of pipelines are not your historical low pressure, under 125 PSI kind of gathering lines. Consequently, there’s a lot of interest in regulating those more in line with transmission lines, which would operate under similar kinds of sizes and pressures.

That’s the background for this rule and how it’s come about. A couple of definitions. One of the definitions in the gathering rule is there’s two types of lines, type A and type B. A type A line is a metal line, where the MAOP is more than 20 percent SMYS.

Again, I got to do some definitions. MAOP, most people know what that is. Maximum allowable operating pressure. SMYS is specified minimum yield strength. That will be either specified based on the way the pipe is manufactured, or calculated under some guidance that’s provided in the rule.

We’re going to just think of that as 20 percent of the designed or delivered yield strength of the pipe. Type A is more than 20 percent of SMYS, or it’s any kind of non-metallic line where the MAOP is more than 125 PSIG.

It’d be plastic pipe that’s being operated at greater than 125 PSIG. That’s currently what’s defined as a gathering line. Type B would be anything that’s not type A. It’s metallic with a MAOP of less than 20 percent of SMYS, or it’s non-metallic or plastic, and an operating MAOP less than 125 PSIG.

That’s one thing that’s really key to understand as you’re walking through this rule. That’s what I was doing this morning as I was having my coffee here at the house on a Saturday morning, as I was going through this rule, and trying to make sure that I had these things clear in my mind.

The other definition that’s important to this is area classification. Area classifications are, there’s class one, two, three, and four area classes in the rule. They’re applied to multiple kinds of situations. Transmission lines, gathering lines, liquid lines, etc.

What’s important about a class area is really, how close is the pipeline to people? Said another way, if you had an incident, how likely is it that people will be impacted? The way these class areas are written is a class one is offshore, or it’s onshore, and it has less than 10 or fewer buildings in an area.

Again, another definition. An area, or a class location unit is the way it’s described in the rule, is 220 yards on either side of any continuous one mile of the pipeline. If you think about this, and again, this is a simplification.

I’m trying to share this in a way that it’s easy to understand. Basically, if I take a line that’s perpendicular to the pipeline, and I run it out two football fields in length, then I make that one mile rectangle that’s 440 yards perpendicular to the pipeline, with the pipeline in the center and one mile long, I start moving that down the pipeline.

I look to see what’s in that area. If I have 10 or fewer buildings per which humans would occupy, then that’s a class one. You can think of that as rural. Class two would be more than 10, but less than 46 buildings.

Class three would be more than 46, or where the pipeline’s 100 yards from where people gather. The definition of this “where people gather” is where you have a group of 20 or more people, at least five days a week, for 10 weeks in any 12 month period.

This would be schools, parks, gymnasiums, churches, that type of thing, where there’s a gathering of a large group of people on a regular basis. Then class four is an area where there’s four story buildings or greater prevalently within that class location unit.

To think of this simplistically, class one is rural, and class four is city. You can think of that as inner city, where I’ve got a lot of multi-story buildings. That allows me to set a basis for talking about, what does this new gathering rule mean in terms of coverage?

At present, gathering lines are those lines that are 8.625 inches or larger, and they’re type A, and class two, three, or four. Right now, there’s no coverage of a line in a class one area, or a rural area. Likewise, type B’s also covered if it’s in class three or four.

What’s different about the coverage requirements of the new gas gathering rule, what originally was proposed in the rule is that type A would include class one. That means type A would include all rural lines, if they had a diameter greater or equal to 8.625 inches.

When you think about that, and there’s some documentation from PHMSA that gives you an idea of how much additional line is gathered up into this new requirement. I’ll link those up in the show notes. That’s impacting a lot of gathering operators.

If you read through the discussion and notes that came back from industry — this would include the AGA and some producer associations and so forth — there’s a fairly large pushback saying, “You know what? We ought to only be doing this for lines greater than 16 inch.”

What’s in discussion, and if you read through the presentation that were to be presented at the January advisory committee, what it’s looking like is where this is going to land…I say “looking like” — I’m not rendering a forecast; I’m just telling you my interpretation of what I’m reading in the presentations — is that at the end of the day, we’re going to be including everything that’s greater than 16 inches, and is type A. If it’s metal, if it’s operated at more than 20 percent of SMYS, and it’s greater than 16 inch, it’s covered. I should say 16 inches or greater, it’s covered.

There’s also — and I don’t know where this will land — discussion in these presentations about including anything 12.75 inches or greater, and where there’s at least one dwelling in the class location unit. This is a big deal, particularly for those operators that are operating in these gas shale places, where they have a lot of this kind of pipe.

I’m going to go through a few of the specific charts and talk about them. I think this’ll be helpful to the listeners to hear this and understand. If you look at PHMSA’s basis that’s laid out in the presentations, they’re posing the question, should the safety of gas gathering be treated any differently than the safety for gas transmission and distribution?

If you look at what PHMSA has recorded as significant incidents in the timeframe of 2008 to 2017, you’re looking at a leading cause of incidents being corrosion, with 63 percent of incidents, the primary factor being corrosion.

The next is 17 percent, with some type of material weld or equipment failure. Then, all other causes is eight percent. It certainly raises the question of, should the integrity management part of 192 be getting applied to a greater portion of these gathering lines, particularly these larger gathering lines?

The kinds of things that are going to get brought into coverage in a new way is design, installation, construction, inspection, and testing. Corrosion control, damage prevention, public awareness. You can think about that as notifying people that are in dwellings located near the pipeline.

Deliberateness in establishing maximum allowable operating pressure, line markage, leakage surveys, repairs, and emergency plans and implementation. This is all stuff that the transmission guys and the liquid guys are all doing already.

It’s just bringing more of it into the gathering lines. One of the things, I think, that’s material — and I’m not exactly sure how this is going to land — but, currently, API recommended practice 80 is incorporated by reference into the rule for determining what is or is not a gathering line.

We could do a whole conversation, a whole podcast, just on all the various considerations as to what is and is not gathering, given what RP 80 says. It’s relatively short.

One of the things that was in the original recommendation is that API RP 80 be removed from being incorporated by reference. I don’t think, based on the way I’m interpreting what’s in these presentations, that’s where we’re going to land. But, API recommended practice 80 is currently undergoing revision. PHMSA is keeping a close look at that process, keeping a close eye on that process. Currently, regulated gas gathering is about 18,000 miles, based on the 2017 PHMSA reports.

Only regulated gas gathering has to comply with the reporting requirements in part 191. The other thing — and this is more with what we do in our businesses around the control room — is that only regulated lines are governed by the control room management rule.

For companies, and this is probably a big deal for production companies that are operating gathering, and they’re not really operating it…They’re operating it as a gathering system, they’re not operating it as a pipeline system, this is probably a very big consideration.

There’s an additional almost 27,000 miles of gathering line that are probably going to be brought under regulatory governance by PHMSA as a result of this rule. Obviously, that’s something that the industry has a lot of interest in.

One of the things that PHMSA did as part of the rulemaking process is they conducted a study and gathered information from a very broad, diverse group of pipeline safety stakeholders. I say “pipeline safety stakeholders.”

I think what the listeners should understand about that comment is that the stakeholders are obviously the regulatory authority and the operators, but the kinds of things that we don’t often think about is local governments, first responders, public advocacy groups, like the Pipeline Safety Trust and others.

All of these are people who have an interest in pipeline safety. They’re soliciting comments back. The results of that study was published in May 2015. We’ll actually link up this report that was a report to Congress on the study.

It’s a pretty substantial document, but I’ll link it up for those of you that have an interest in reading such things. They did a comprehensive review of the existing regulations for not only gas, but gas and liquid gathering lines.

Gas was the place that probably is most affected by that review. A couple of key outcomes or conclusions that were drawn in the report talked about this already. Many gathering lines are as large or larger than transmission pipelines, and operate at similar, or even higher, stress levels.

One of the outcomes is that the GAO (the Government Accounting Office) has recommended that PHMSA collect data on gathering lines, comparable to the data collected for transmission lines. PHMSA proposed to do this for all gathering lines, regulated or not, or governed or not by the regulatory requirements. That’s a process that’s ongoing.

One of the things that PHMSA proposed in this rule was to remove the reference to API RP 80 as a means for defining endpoints of gas gathering lines, and to replace that with four standalone definitions for gathering lines, including clarification on incidental gathering lines, gas processing plant, gas treatment facility, and onshore production facility.

The API and the Independent Petroleum Association of America both strongly recommended against, or suggest that PHMSA reconsider abandoning API RP 80. There’s a lot of concern about creating confusion.

Here the statement in the chart. “PHMSA acknowledges a change to the definition of gas gathering lines is a complicated and consequential change. After the publishing of the Notice of Proposed Rulemaking, API established a working group to consider revisions to API RP 80 to address the issues that led to the proposed changes in the rulemaking.”

So, there’s now a working group, and they’re making progress to address definition. PHMSA’s monitoring that working group. It’s also looking at API RP 1182, which is risk assessment for larger diameter gas gathering lines, or safety provisions for onshore gas gathering lines.

What I think you’re going to see is a fairly significant uplift of RP 80 and an alignment of RP 80 with this rulemaking. That’ll be interesting to watch, see where that goes. It looks like the rulemaking will withdraw the recommendation to eliminate RP 80 from the rule, but they’re going to monitor the API working group.

There could be additional rulemaking in the future, once that all settles out. That’s taking a contentious issue and taking it off the table, in order that these other things that are agreed to can move forward. The other thing about the scope was the rule originally came out, offering six months to get into compliance.

The public comment is that operators should be allowed two years to identify these new lines that are going to be subject to regulation. For some guys, this is going to be a fairly large undertaking to do a review, and to determine which of their pipelines are, or are not, covered.

As a last comment about all this, I think one of the challenges for operators, in terms of understanding their SMYS, is depending on when the pipe was installed, or the nature of the material of the pipe, they may not know their SMYS.

The rule contemplates this, and subpart C provides calculations for determining SMYS. That could be a fairly big undertaking, I think, for a number of operators. It’s not clear exactly how that’s going to shake out. We’ll certainly be keeping an eye on that.

I’m going to wrap this up, and just say that for operators of gas gathering systems, where you have pipe that is 12.75 inches or greater, and is being above 20 percent of SMYS, or where the MAOP is above 20 percent of SMYS, you’re going to be impacted by this rulemaking.

If you’re not already doing it, it’s probably a good idea to take a look. I would suspect most operators are aware of this, and see it coming down the road. The Pipeline Advisory Council meeting is in June of this year. It’s been rescheduled.

I know that, at least based on the things I was looking at in the second half of last year, PHMSA’s under a lot of pressure from the Senate and from the House to move this regulation forward. I think there’s a lot of support for this regulation from the public.

It’s coming like a freight train, would be the way one of my friends would say it. Hopefully, for those of you that are listening, this will help you understand the impacts and start looking at it. If you have questions, please go to the show notes page. We’re going to link up these resources.

If you’d like to reach out to me directly, and have any conversations about this, I’d certainly be open to doing that. Thank you very much for listening to this episode, and I hope you found it helpful.

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Russel:  If you have questions, ideas, or topics that you’d be interested in learning about, please let us know on the Contact Us page at pipelinerspodcast.com, or reach out to me directly on LinkedIn. Thanks for listening. I’ll talk to you next week.

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