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Texas Gas Association Transmission Roundtable November 14, 2013

Texas Gas Association Transmission Roundtable November 14, 2013. Railroad Commission of Texas Pipeline Safety Division Update. The Railroad Commission in the 83 rd Texas Legislature.

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Texas Gas Association Transmission Roundtable November 14, 2013

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  1. Texas Gas AssociationTransmission RoundtableNovember 14, 2013 Railroad Commission of Texas Pipeline Safety Division Update

  2. The Railroad Commissionin the 83rd Texas Legislature The Legislature reauthorized the Railroad Commission for another four years, and approved funding for the Commission in the state’s budget, which includes funds for an overhaul of the Information Technology department. Additional funding for the Information Technology basics includes: • Equipment Replacements and Upgrades; • Personal Computing Office Leasing; • Toughbook Computing for Field Inspectors; and • Software Licenses and Services.

  3. The Railroad Commissionin the 83rd Texas Legislature The Legislature also approved funding for four major programming projects: • Commission-Wide Regulated Operator Internet Portal; • Gas Services Division Online Filing; • Pipeline Online Permitting; and • Liquefied Petroleum Gas Section Online Reporting. Additional funding was granted to the Office of General Counsel for three new Legal Enforcement attorney positions.

  4. Pipeline Online Permitting The issuance of pipeline permits provides a starting point for operators to report organizational and pipeline information. Currently, the pipeline permit application forms (Form T-4) provide the central connection hub for: • Mapping • Pipeline classifications • common carrier • utility • private line • interstate • intrastate • Links to other pipeline information, e.g. jurisdictional status for field evaluations • New construction information • Activities in other divisions • Public inquiries

  5. Pipeline Online Permitting Online permit filing will: • Be user-friendly • Allow operators to file or amend permits to operate and to submit yearly renewals on line • Reduce incomplete information and data that conflicts with existing information • Reduce paper waste, postage, and employee-hours required to maintain permit records • Enhance the existing archiving process to enable it to cross-reference pipeline and operator information • Enable use of GIS data as the entry point, along with cross-referenced permit data, to achieve greater transparency for • inspection reports • enforcement actions • compliance information, particularly for incidents and accidents By moving to an online filing system, the Commission will be able to receive and analyze information about its own work and to report that information in a timely manner with confidence in its accuracy.

  6. Pipeline Safety Issuesin the 83rd Texas Legislature Three Main Commission Issues: • Statutory Penalty Amounts • Definition of “Hazardous Liquids” • Exceptional Item for Staffing And a fourth issue that came up during the session: safety regulation of Class 1 and rural gathering.

  7. Pipeline Safety Issuesin the 83rd Texas Legislature Three Main Commission Issues: • Statutory Penalty Amounts • Definition of “Hazardous Liquids” • Exceptional Item for Staffing And a fourth issue that came up during the session: safety regulation of Class 1 and rural gathering.

  8. Pipeline Safety Penalties • Senate Bill 900 amends the statutory administrative, civil, and criminal penalties for violation of certain statutes under the jurisdiction of, rules or orders adopted by, or licenses, permits, or certificates issued by the Railroad Commission of Texas. • The penalty amounts for these violations has not been changed since 1983, and currently are a maximum of $10,000 per day. Each day a violation continued is a separate violation; there is no cap. • Under Senate Bill 900, the maximum penalty is $200,000 per day, with each day a violation continues being a separate violation. There is a cap of $2 million for a related series of violations. This matches the penalty provisions in the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011.The bill takes effect on September 1, 2013.

  9. Definition of “Hazardous Liquid” • Senate Bill 901 amends the definition of the term “Hazardous Liquid” in State law to match the definition of that term in the federal Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011. • The amended definition includes “nonpetroleum fuel, including biofuel, that is flammable, toxic, or corrosive or would be harmful to the environment if released in significant quantities.”

  10. Exceptional Item for Staffing Senate Bill 1, the general appropriations act, approved the Commission’s request for 20 additional positions in the Pipeline Safety Division, beginning September 1, 2013. • 14 Regional Field Inspectors • 4 Damage Prevention Technical Staff • 2 Compliance Support Staff

  11. Exceptional Item for Staffing Funding the General Revenue portion of the appropriation for the exceptional item was contingent upon the Commission increasing the Pipeline Safety and Regulatory Fee from its current rate of $0.75 per service line per year to the statutory maximum of $1.00 per service line per year. • The Commission adopted the proposal to increase the fee at the open meeting on October 22, 2013. • The new rule will become effective on November 11, 2013, for remittance on March 15, 2014.

  12. Class 1 and Rural Gathering House Bill 2982, 83rd Texas Legislature, expressly directs the Railroad Commission to regulate Class 1 and rural gathering lines based on risk. Until September 1, 2015, however, the Commission may exercise this regulatory authority only to:             (1) provide a process for the commission to investigate an accident, an incident, a threat to public safety, or a complaint related to operational safety and to require an operator to submit a plan to remediate an accident, incident, threat, or complaint;             (2) require reports necessary to allow the commission to investigate an accident, an incident, a threat to public safety, or a complaint related to operational safety; or             (3) require operators to provide information to the commission that the commission determines is necessary to determine the risks presented to the public safety by:                        (A) the intrastate transportation of hazardous liquids and carbon dioxide by gathering pipeline facilities in rural locations and intrastate hazardous liquid and carbon dioxide gathering pipeline facilities in rural locations; and                         (B) gas gathering facilities and transportation activities in Class 1 locations, as defined by 49 C.F.R. Section 192.5.

  13. Class 1 and Rural Gathering To implement House Bill 2982, the Pipeline Safety Division has held two meetings with industry representatives to discuss such issues as: • General industry awareness of the legislation; • What information is needed to determine “risk” of Class 1 and rural gathering pipelines, and what is the best way to obtain it; • Should there be a “baseline” of regulation that applies to all pipelines, such as • cathodic protection • line markers • pressure control • applicability of damage prevention requirements • obligation to conduct community and emergency response liaison meetings • incident/accident reporting to the Commission

  14. Class 1 and Rural Gathering Preliminary steps in the implementation of House Bill 2982. • Strip-Out and website information • Regional meetings, beginning in January. Suggested sites: • Corpus Christi and/or San Antonio • Midland/Big Spring/Abilene • Houston • Kilgore • Fort Worth • Amarillo • Initial Survey

  15. Texas Pipeline Miles 1. Natural Gas Distribution 100,404 2. Natural Gas Master Meters 419 3. LP-Gas Distribution 164 4. Natural Gas Transmission & Storage 33,739 5. Natural Gas Gathering 4,029 6. Hazardous Liquids Transmission & Storage 29,768 7. Hazardous Liquids Gathering 1,041 8. Total Regulated Intrastate Miles (sum of 1 through 7) 168,564 9. Intra-State Production and Gathering Lines Leaving Lease 159,604 10. Total Intra-State Pipeline Miles in Texas (regulated and non-regulated; sum of 8 and 9) 328,168 11. Inter-State Natural Gas Transmission Pipelines 21,724 12. Inter-State Hazardous Liquids Transmission Pipelines 24,426 13. Total Regulated Inter-State Miles (sum of 11 and 12) 46,150 14. Total Regulated Miles (intra-state and inter-state; sum of 8 and 13) 214,714 15. Total Pipeline Miles in Texas (inter-state and intra-state, regulated and non-regulated; sum of 10 and 13) 374,318

  16. Texas Pipeline Miles

  17. Chapter 18 Amendments • Pipeline Safety Division staff draft submitted to the Office of General Counsel • Time Line for Project presented to Commission management today • If approved, the proposed rules will be presented at conference on December 18, 2013, for approval to publish in the Texas Register • Publication expected on January 3, 2014 • Comment period will likely include a public comment hearing sometime in February 2014 • Anticipate presenting a recommendation on adoption on April 22, 2014 • Rules become effective May 12, 2014

  18. Questions?

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