Low-Stress Hazardous Liquid Pipelines Serving Plants and Terminals

DEPARTMENT OF TRANSPORTATION

Research and Special Programs Administration

49 CFR Part 195

[Docket No. PS-117; Amdt. 195-57]

RIN 2137-AC87

Low-Stress Hazardous Liquid Pipelines Serving Plants and

Terminals

AGENCY: Research and Special Programs Administration (RSPA), DOT.

ACTION: Direct final rule.

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SUMMARY: This final rule excludes from RSPA's safety regulations for

hazardous liquid 1 pipelines (1) low-stress pipelines

2 regulated for safety by the U.S. Coast Guard; and (2) low-

stress pipelines less than 1 mile long that serve certain plants and

transportation terminals without crossing an offshore area or a

waterway currently used for commercial navigation. RSPA previously

stayed enforcement of the regulations against these pipelines to

mitigate compliance difficulties that did not appear warranted by risk.

The rule change conforms the regulations with this enforcement policy.

\1\ ``Hazardous liquid'' means petroleum, petroleum products, or

anhydrous ammonia.

\2\ ``Low-stress pipeline'' means a hazardous liquid pipeline

that is operated in its entirety at a stress level of 20 percent or

less of the specified minimum yield strength (SMYS) of the line

pipe.

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DATES: This direct final rule is effective October 7, 1997. If RSPA

does not receive any adverse comment or notice

[[Page 31365]]

of intent to file an adverse comment by August 8, 1997 the rule will

become effective on the date specified. RSPA will issue a subsequent

notice in the Federal Register by September 8, 1997 after the close of

the comment period to confirm that fact and reiterate the effective

date. If an adverse comment or notice of intent to file an adverse

comment is received, RSPA will issue a timely notice in the Federal

Register to confirm that fact and RSPA would withdraw the direct final

rule in whole or in part. RSPA may then incorporate the adverse comment

into a subsequent direct final rule or may publish a notice of proposed

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rulemaking.

ADDRESSES: Send comments in duplicate to the Dockets Unit, Room 8421,

Research and Special Programs Administration, U. S. Department of

Transportation, 400 Seventh Street, SW, Washington, DC 20590. Identify

the docket and notice number stated in the heading of this notice. All

comments and docketed material will be available for inspection and

copying in Room 8421 between 8:30 a.m. and 5 p.m. each business day.

FOR FURTHER INFORMATION CONTACT: L. M. Furrow, (202)366-4559, regarding

the subject matter of this notice. Contact the Dockets Unit, (202) 366-

5046, for copies of this notice or other material in the docket.

SUPPLEMENTARY INFORMATION:

I. Background

When RSPA's safety regulations for hazardous liquid pipelines (49

CFR part 195) were first published, the regulations did not apply to

low-stress pipelines (34 FR 15473, Oct. 4, 1969). Because of their

generally low operating pressures, low-stress hazardous liquid

pipelines were thought to pose little risk to public safety.

In recent years, however, during a time of increased environmental

awareness, critical accidents involving low-stress pipelines led

Congress to restrict DOT's discretion to except these lines from

regulation. The most prominent accident was the January 1990 spill of

approximately 500,000 gallons of heating oil from an underwater Exxon

pipeline into the Arthur Kill, a navigable waterway that separates

Staten Island from New Jersey. Three years earlier, a 5,000-gallon

spill of jet fuel on the Kinley pipeline in Iowa threatened the

Missouri River. Both pipelines would have been covered by part 195 had

there not been the low-stress exception. So, in an amendment to the

pipeline safety laws, Congress directed the Secretary of Transportation

not to provide an exception from regulation for a hazardous liquid

pipeline facility only because the facility operates at low internal

stress (49 U.S.C. 60102(k)).

In response to this change in the law, RSPA extended the part 195

regulations to cover certain low-stress pipelines of higher risk

(Docket No. PS-117; 59 FR 35465, July 12, 1994). Except for onshore

rural gathering lines and gravity-powered lines, the following

categories of low-stress pipelines were brought under the regulations:

Pipelines that transport highly volatile liquids, pipelines located

onshore and outside rural areas, pipelines located offshore, and

pipelines located in waterways that are currently used for commercial

navigation (Sec. 195.1(b)(3)). Because the rulemaking record showed

that many low-stress pipelines probably were not operated and

maintained consistent with part 195 requirements, operators were

allowed to delay compliance of their existing lines until July 12, 1996

(Sec. 195.1(c)).

II. Interfacility Transfer Lines

A. Description

The largest proportion of low-stress pipelines brought under part

195 consisted of interfacility transfer lines (about two-thirds of the

pipelines and one-third of the overall mileage). The remainder included

trunk lines and certain gathering lines.

Interfacility transfer lines move hazardous liquids locally between

facilities such as truck, rail, and vessel transportation terminals,

manufacturing plants, petrochemical plants, and oil refineries, or

between these facilities and associated storage or long-distance

pipeline transportation.3 The lines usually are short,

averaging about a mile in length. Typically they are operated in

association with other transfer piping on the grounds of the plants and

terminals they serve. However, some interfacility transfer lines that

deliver hazardous liquids to plants or terminals from long-distance

pipelines may be operated by the long-distance pipeline operators.

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\3\ The interfacility transfer lines did not include piping that

connect high-stress pipelines with surge tanks located at plants and

terminals. This piping was already subject to the part 195

regulations as part of the pipeline systems for which the tanks

relieve surges.

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B. Related Federal Regulations

Segments of interfacility transfer lines located on the grounds of

industrial plants and transportation terminals are subject to the

Process Safety Management regulations of the Occupational Safety and

Health Administration (OSHA) (29 CFR 1910.119). These regulations,

which involve hazard analysis and control, operating and maintenance

procedures, and personnel training, are intended to reduce the risk of

fires and explosions caused by the escape of hazardous chemicals from

facility processes.

Although on-grounds segments of interfacility transfer lines

generally are excepted from part 195 (Sec. 195.1(b) (6) and

(7)),4 the on-grounds segment and regulated off-grounds

segment of a line function together as a unit. Thus, OSHA's Process

Safety Management regulations, though applicable only to on-grounds

segments, affect the operation of off-grounds segments. And, similarly,

compliance with part 195 for off-grounds segments affects operation of

the unregulated on-grounds segments.

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\4\ Segments of interfacility transfer lines on plant or

terminal grounds are subject to part 195 if the segment connects a

regulated pipeline (including off-grounds segments of interfacility

transfer lines) to a surge tank or other device necessary to control

the operating pressure of the regulated pipeline.

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In addition, transfer lines between vessels and marine

transportation-related facilities are subject to safety regulations of

the U.S. Coast Guard (33 CFR parts 154 and 156). The Coast Guard

applies these regulations to transfers of hazardous liquid from the

dock loading arm or manifold up to the first valve after the line

enters the Spill Prevention Control and Countermeasure (SPCC)

containment or secondary containment if the facilities are not

protected by SPCC plans.

C. Compliance Difficulties and Risk

Information we received in response to Notice 1 of Docket PS-117

(55 FR 45822, Oct. 31, 1990) showed that bringing interfacility

transfer lines into full compliance with part 195 would be difficult

for many operators. The primary difficulty is that their lines are not

installed and operated on the basis of Part 195 standards. For example,

considering the short length and low operating stress of the lines,

additional pipe wall thickness is often used instead of cathodic

protection to resist expected corrosion. But, regardless of this

feature, under part 195, cathodic protection systems would have to be

developed and installed as required. Other part 195 requirements that

may not bring commensurate benefits for short, low-stress transfer

lines involve modification of operations and maintenance manuals,

installation of pressure control equipment, and establishment of

programs to carry out drug and alcohol rules under 49 CFR part 199.

Also, operating personnel would have to be trained to carry out part

195 requirements.

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After publication of the Final Rule in Docket PS-117, we learned

about another significant compliance difficulty. Transfer line

operators and their representatives said that coping with the separate

federal regulatory regimes of RSPA, OSHA, and the Coast Guard over

transfer lines was a strain on resources. As explained above, OSHA's

Process Safety Management regulations and RSPA's Part 195 standards

have an overlapping effect on operation of interfacility transfer

lines. This overlap results in analogous administrative costs for

records, procedures, and manuals. Worse yet it creates opportunities

for mistakes when operating personnel have to meet different

requirements with similar objectives.

For transfers between vessels and marine transportation-related

facilities, the Coast Guard safety regulations compound the RSPA-OSHA

overlap problem. Moreover, application of part 195 to these marine

terminal transfer lines duplicates agency efforts within DOT. It also

leaves the industry uncertain which DOT safety standards apply to

particular facilities. So the upshot of these separate regulatory

regimes of RSPA, OSHA, and the Coast Guard is not only the added costs

of meeting separate requirements directed at similar safety objectives,

but also possible confusion of operating personnel.

The low-stress pipeline regulations also present RSPA and its

cooperating State agencies with related compliance difficulties.

Carrying out adequate compliance inspections on interfacility transfer

lines would require a significant increase in resources. We estimate

that about 11,000 miles of low-stress pipelines are now under part 195,

with over a third of the mileage composed of short interfacility

transfer lines. Just the job of finding and educating the many

operators of these short lines would likely be a major, protracted

effort.

We weighed these industry and government compliance difficulties

against the need for risk reduction on low-stress interfacility

transfer lines. Our conclusion: The potential benefits of complying

with part 195 do not justify the compliance difficulties if the line is

short and does not cross an offshore area or a commercially navigable

waterway, or if the line is regulated by the Coast Guard. There were

several reasons for this decision. First, RSPA's pipeline safety data

do not show that short interfacility transfer lines have been a source

of significant safety problems. Another reason was that the low

operating hoop stress of interfacility transfer lines is itself a

safeguard against several accident causes. And, from the consequence

perspective, a short length means the potential spill volume would be

limited should an accident occur. Also, public exposure is typically

limited in the industrial areas where most low-stress transfer lines

are located. For marine transfer lines, the risk is reduced even

further by the Coast Guard regulations and inspection force. At the

same time, except for Coast Guard regulated lines, the potential of

transfer lines located offshore or in commercially navigable waterways

to cause environmental harm tipped the scale toward continued

compliance with part 195.

D. Stay of Enforcement

In view of the above considerations, we became concerned that the

continued application of part 195 to Coast Guard regulated lines and

other short interfacility transfer lines not crossing an offshore area

or a navigable waterway was not in the public interest. Consequently,

we announced a stay of enforcement of part 195 against these lines (61

FR 24245; May 14, 1996). The stay applies to low-stress pipelines that

are regulated by the Coast Guard or that extend less than 1 mile

outside plant or terminal grounds without crossing an offshore area or

any waterway currently used for commercial navigation. The stay will

remain in effect until modified or until the part 195 regulations are

finally revised as a result of the present action.

Since announcement of the stay, we have not received any request to

lift it. More important, last year we explained this new enforcement

policy at two public meetings of the Technical Hazardous Liquid

Pipeline Safety Advisory Committee, a statutory panel that reviews

RSPA's pipeline safety program. We also explained our plan to revise

the part 195 regulations to match the new policy. Neither the Committee

members nor the public attendees raised any objection to the

enforcement policy or planned rule change. Further, State agencies who

cooperate with RSPA in enforcing safety standards over interfacility

transfer lines have not objected to the stay.

E. The Rule Change

The present rulemaking action removes from the application of part

195 those low-stress interfacility transfer lines that are covered by

the stay of enforcement. This rule change is achieved by revising

Sec. 195.1(b)(3) as set forth below. Besides the low-stress pipelines

covered by the stay, revised Sec. 195.1(b)(3) continues to exclude from

part 195 the low-stress pipelines that were already excluded before the

present action.

To make this rule change, rather than first publish a notice of

proposed rulemaking as contemplated in the stay of enforcement, we are

using the direct final rule procedure under 49 CFR 190.339. This new

rulemaking procedure was not yet in effect when the stay was announced.

Although this procedure does not provide for prior public notice and

opportunity for comment, interested persons may participate as

explained above under the ``Effective date'' heading. A direct final

rule is appropriate in this case because, based on the history of the

stay of enforcement, we believe the rule change is not controversial,

is in the public interest, and is not likely to draw adverse comment.

III. Regulatory Analyses and Notices

A. Executive Order 12866 and DOT Policies and Procedures

The Office of Management and Budget (OMB) does not consider this

action to be a significant regulatory action under section 3(f) of

Executive Order 12866 (58 FR 51735; October 4, 1993). Therefore, OMB

has not reviewed this final rule document. DOT does not consider this

action significant under its regulatory policies and procedures (44 FR

11034; February 26, 1979).

RSPA prepared a study of the costs and benefits of the Final Rule

that extended part 195 to cover certain low-stress pipelines (Final

Regulatory Evaluation, Docket No. PS-117). That study, which

encompassed short or Coast Guard regulated interfacility transfer

lines, showed that the Final Rule would result in net benefits to

society, with a benefit to cost ratio of 1.5.

The Final Regulatory Evaluation determined costs and benefits of

the Final Rule on a mileage basis. But while costs were evenly

distributed, most of the expected benefits were projected from accident

data that did not involve short or Coast Guard regulated interfacility

transfer lines. So, since the present action affects only these lines,

it is reasonable to believe the action will reduce more costs than

benefits. Thus, the present action should enhance the net benefits of

the Final Rule. Because of this likely economic effect, a further

regulatory evaluation of the Final Rule in Docket No. PS-117 or of the

present action is not warranted.

B. Regulatory Flexibility Act

Low stress interfacility transfer lines covered by the present

action are associated primarily with the operation

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of refineries, petrochemical and other industrial plants, and materials

transportation terminals. In general, these facilities are not operated

by small entities. Nonetheless, even if small entities operate low-

stress interfacility transfer lines, their costs will be lower because

this action reduces compliance burdens. Therefore, based on the facts

available about the anticipated impact of this rulemaking action, I

certify, pursuant to section 605 of the Regulatory Flexibility Act (5

U.S.C. 605), that this rulemaking action will not have a significant

economic impact on a substantial number of small entities.

C. Executive Order 12612

RSPA has analyzed this action in accordance with the principles and

criteria contained in Executive Order 12612 (52 FR 41685). RSPA has

determined that the action does not have sufficient federalism

implications to warrant preparation of a Federalism Assessment.

D. Paperwork Reduction Act

This action reduces the pipeline mileage and number of operators

subject to part 195. Consequently, it reduces the information

collection burden of part 195 that is subject to review by OMB under

the Paperwork Reduction Act of 1995. OMB has approved the information

collection requirements of part 195 through May 31, 1999 (OMB No. 2137-

0047).

List of Subjects in 49 CFR Part 195

Ammonia, Carbon dioxide, Petroleum, Pipeline safety, Reporting and

recordkeeping requirements.

In consideration of the foregoing, RSPA amends 49 CFR part 195 as

follows:

PART 195--[AMENDED]

1. The authority citation for part 195 continues to read as

follows:

Authority: 49 U.S.C. 5103, 60102, 60104, 60108, 60109, 60118;

and 49 CFR 1.53.

2. In Sec. 195.1, the introductory text of paragraph (b) is

republished, and paragraph (b)(3) is revised to read as follows:

Sec. 195.1 Applicability.

* * * * *

(b) This part does not apply to--

* * * * *

(3) Transportation through the following low-stress pipelines:

(i) An onshore pipeline or pipeline segment that--

(A) Does not transport HVL;

(B) Is located in a rural area; and

(C) Is located outside a waterway currently used for commercial

navigation;

(ii) A pipeline subject to safety regulations of the U.S. Coast

Guard; and

(iii) A pipeline that serves refining, manufacturing, or truck,

rail, or vessel terminal facilities, if the pipeline is less than 1

mile long (measured outside facility grounds) and does not cross an

offshore area or a waterway currently used for commercial navigation;

* * * * *

Issued in Washington, D.C., on June 4, 1997.

Kelley S. Coyner,

Deputy Administrator.

[FR Doc. 97-14999 Filed 6-6-97; 8:45 am]

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