Darin Burk Pipeline Safety Program Manager

1. Darin BurkPipeline Safety Program Manager Illinois Commerce Commission

2. Significant Change • September 9, 2010 – San Bruno, CA • 30” Transmission Pipeline Rupture • Produced Crater 72’ x 26’ • 47.6 million cubic feet of gas released • Ignition Occurred • 8 fatalities • Numerous Injuries • 38 Homes Destroyed and 70 Homes Damaged

3. Crater and Pipe – San Bruno, CA

4. San Bruno, CA

5. Findings and Fallout • Substandard pipe had been installed in 1956 • Welding standards had not been met • The seam weld failed • PG&E had inadequate emergency response procedures • PG&E Public Awareness Program was inadequate • California Public Utility Commission was not performing adequate inspections

6. Recommendations • Pipeline operators need to share operation and emergency response information with Emergency Responders. • Require Post-incident Anti-drug and Alcohol Tests • Spike Tests on all pre-1970 transmission lines • Enhance Integrity Management Programs • Modify Transmission Lines for In-line Inspection (Smart Pigs)

7. Consequences • PHMSA is under scrutiny of Congress and Public • Office of Inspector General (“OIG”) is conducting audits of PHMSA and State Pipeline Safety Programs • PHMSA – Are states doing their job • OIG – Is PHMSA doing it’s job • OIG will report to Secretary of Transportation and Congress

8. Revised Pipeline Safety Act • Pipeline Safety, Regulatory Certainty and Job Creation Act of 2011 has resulted in: • Advisory Notice regarding mandate leak and valve study • Study to determine if remote leak detection and remote shut-off valves should be required on pipelines • Proposal to revise the Transmission Annual and Incident Report data reporting requirements regarding MAOP verification • Would eliminate the “Grandfather” clause regarding the MAOP of transmission pipelines and require hydro testing on that any transmission line that has not been previously hydro tested

9. Revised Pipeline Safety Act • What’s Coming? • Maximum penalties moving from $100,000 per day to $200,00 per violation • Reduction in funding of states with inadequate Damage Prevention Programs • Study to determine if IMP inspection criteria for transmission pipelines should be expanded beyond HCAs • Requirement to promotes awareness of the NPMS • Monitoring of cast iron replacement programs • Setting of specific time limits to report an incident – 1 hour from time of discovery

10. Revised Pipeline Safety Act • What Coming? • Review of regulations regarding gathering lines • Study to determine feasibility of expanded use of excess flow valves • Limitations regarding incorporation of industry standards by the CFR • Study regarding the use of minority and woman owned businesses associated with the operation and maintenance of pipeline facilities

11. “Weak State” • Term being used in D.C. • How will PHMSA determine a “Weak State” • Minimum Staffing Levels • Inspection Day Quota • Enforcement Actions • PHMSA will: • Issue a warning to the State • Reduce funding to State Program • Decertify State Program

12. Is Illinois A “Weak State” • Illinois: • Meets minimum staffing level • Conducts the required inspections • Takes Enforcement Actions • Issues Civil Penalties • Illinois will: • Enhance Inspection Activities • Issues Civil Penalties • Post Inspection Results

13. ICC Initiatives • Conduct comprehensive reviews of all required plans and procedures • Issue NOAs or NOPVs regarding inadequate plans and procedures • Initiate civil penalties for failure to modify the plans and procedures • Initiate civil penalties for code violations that result in an reportable incident • Initiate civil penalties for failure to respond to our notices

14. Impact On Operators • Enhanced Inspection Activity • PA Plans • DIMP Plans • OQ Plans • Anti-D&A Plans • Enhance Enforcement Procedures • Zero tolerance regarding Code Compliance • More Stringent Enforcement • Enhanced Use of Civil Penalties

15. How Should Operators Prepare? • Review all Plans and Procedures to: • Ensure they address all code requirements • Are applicable to your system • Ensure that all operator personnel are familiar with the required activities, processes and procedures included in the Plans • Follow the Code and Plan Requirements • Keep Accurate and Complete Records

16. Known Weaknesses • Knowledge of Plan Requirements • Operators need to know what is in their plans! • Failure to implement Code and Plan Requirements • Operators frequently fail to implement their own procedures • Failure to maintain Accurate and Complete Records • Some Operators fail to use their own forms

17. Known Weaknesses • Training and Qualification • Operator personnel need to be effectively trained and qualified • Lack of Resources • Skilled personnel need assistance with scheduling and paperwork • “The Job Isn’t Finished Until the Paperwork Is Done”

18. Enforcement Data 2009 • Probable violations found in 2009 = 135 • Probable violations corrected in 2009 = 53 • Probable violations at the end of 2009 = 120 • Compliance Actions taken in 2009 = 43 • Civil Penalties assessed in 2009 = 0 • Dollars assessed in 2009 = 0 • Civil Penalties collected in 2009 = 0 • Dollars collected in 2009 = 0

19. Enforcement Data 2010 • Probable violations found in 2010 = 138 • Probable violations corrected in 2010 = 177 • Probable violations at the end of 2010 = 81 • Compliance Actions taken in 2010 = 37 • Civil Penalties assessed in 2010 = 0 • Dollars assessed in 2010 = $0.00 • Civil Penalties collected in 2010 = 0 • Dollars collected in 2010 = $0.00

20. Enforcement Data 2011 • Probable violations found in 2011 = 59 • Probable violations corrected in 2011 = 64 • Probable violations at the end of 2011 = 76 • Compliance Actions taken in 2011 = 22 • Civil Penalties assessed in 2011 = 2 • Dollars assessed in 2011 = 800,000 • Civil Penalties collected in 2011 = 2 • Dollars collected in 2011 = 800,000

21. Information Resources • http://www.icc.illinois.gov/PipelineSafety/ • Enforcement Data • Links to the CFR Parts 191, 192, 193, 199 and Part 40 • Code Updates • Advisory Notices • Proposed Rules • Link to Operator Registry – Validation Deadline 09/30/2012 • Links to PHMSA Sites • Link to Emergency Responder Training

22. http://primis.phmsa.dot.gov/comm/reports/operator/Operatorlist.html?nocache=7941http://primis.phmsa.dot.gov/comm/reports/operator/Operatorlist.html?nocache=7941 • Operator Information • Emergency Responder Training • Damage Prevention information • Pipeline Regulations • Link to National Pipeline Mapping System • Community Assistance & Technical Services • Link to Common Ground Alliance • Emergency Planning Information

23. Questions?