# Hilcorp Alaska, LLC — Pipeline Special Permit **Citation:** PHMSA-2017-0091 **Type / status:** permit / current **Agency:** Pipeline and Hazardous Materials Safety Administration **Effective:** 2019-04-29 **Published:** 2019-04-29 PHMSA-2017-0091, issued 2019-04-29 for Hilcorp Alaska, LLC's hazardous liquid system. ## Document text PHMSA pipeline special permit PHMSA-2017-0091. Operator: Hilcorp Alaska, LLC. System: Hazardous Liquid. Issue date: 2019-04-29. <<>> 0 U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 1200 New Jersey Avenue, SE Washington, D.C. 20590 APR 292019 Mr. David S. Wilkins Senior Vice President Hilcorp Alaska, LLC 3800 Centerpoint Drive, Suite 1400 Anchorage, AK 99503 Docket No. PHMSA-2017-0091 Dear Mr. Wilkins: On March 24, 2017, Hilcorp Alaska, LLC (HilcOrp) wrote to the Pipeline and Hazardous Materials Safety Administration (PHMSA) requesting a special permit to waive compliance from the pipeline safety regulations in 49 Code of Federal Regulations (CFR) 195.563 and 195.573 for the proposed Liberty Pipeline. The proposed Liberty Pipeline will be approximately 7.25 miles in length, and will be located in the Foggy Island Bay of the Beaufort Sea Outer Continental Shelf and State of Alaska waters. The Liberty Pipeline will come ashore in Alaska and traverse approximately 1.5 miles above ground and tie into the existing Badami Pipeline. The regulations in 49 CFR 195.563 and 195.573 require hazardous liquid pipeline operators to maintain cathodic protection currents on steel pipelines, and to monitor the level of cathodic protection currents to prevent external corrosion or metal loss on pipelines. The Liberty Pipeline is planned to be a 12.75-inch diameter carrier pipe placed inside a 16-inch diameter casing pipe (pipe-in-pipe or PIP) for approximately 5.68 miles. Cathodic protection currents will be unable to reach and protect the 12.75-inch diameter carrier pipe from corrosion, and Hilcorp will be unable to monitor cathodic protection currents based on their planned design. The purpose of the Liberty Pipeline special permit with conditions, is to assure safety and environmental protection are maintained in lieu of compliance with these cathodic protection Federal regulations. PHMSA is granting this special permit (enclosed) which will allow Hilcorp to operate the Liberty Pipeline at a maximum operating pressure (MOP) of 1,480 pounds per square inch gauge (psig), and without monitoring cathodic protection currents, or the cathodic protection currents reaching the 12.75-inch carrier pipeline. This special permit provides relief from the Federal pipeline safety regulations for a segment of the Liberty Pipeline, but requires Hilcorp to comply with certain conditions and limitations designed to maintain pipeline safety and to protect the environment. <<>> My staff would be pleased to discuss this matter or any other regulatory matter with you. Mr. John Gale, Director, Standards and Rulemaking Division may be contacted at 202-366-0434, on regulatory matters, and Mr. Max Kieba, Acting Director, Engineering and Research Division, may be contacted at 202-493-0595, on technical matters specific to this special permit grant. Sincerely, LA4.Alan K. Mayberry Associate Administrator for Pipeline Safety Enclosure: Special Permit- PHMSA-2017-0091 PHMSA-2017-0091- Hilcorp- Liberty Pipeline- Letter of Decision Page 2 of 2 <<>> U.S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION SPECIAL PERMIT Special Permit Information: Docket Number: Requested By: Operator ID#: Original Date Requested: Original Issuance Date: Effective Dates: Code Sections: PHMSA-20 17-0091 Hilcorp Alaska, LLC 32645 March 24, 2017 April 29, 2019 April 29, 2019-April 29, 2029 49 CFR 195.563 and 195.573 Grant of Special Permit: By this order, subject to the tenns and conditions set forth below, the United States Department of Transportation (DOT), Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),' grants this special permit to Hilcorp Alaska, LLC (Hilcorp),2 owner and operator ofthe proposed Liberty Sales Oil Pipeline (Liberty Pipeline). This special permit waives compliance from various sections of 49 CFR Part 195. Specifically, the Liberty Pipeline special permit waives compliance with 49 CFR 195.563 and 195.573. The Liberty Pipeline will originate on the Liberty Drilling and Production Island (LDPI), an artificial island located in federal waters. The submerged pipeline will extend southwards for approximately 5.68 miles through the Foggy Island Bay of the Beaufort Sea Outer Continental Shelf (OCS) and State of Alaska waters. The Liberty Pipeline will then come ashore, traverse approximately 1.5 miles above ground, and tie into the existing Badami pipeline. The Liberty Pipeline consists of a 12.75- 1 Throughout this special permit, the usage of"PHMSA" or "PHIMSA UPS,' means the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration, Office ofPipeline Safety. 2 Hilcorp Alaska, LLC is a wholly-owned, operating subsidiary of Hilcorp. The Liberty Project partners include Hilcorp Alaska, LLC, BP Exploration (Alaska) Inc., and ASRC Exploration, LLC. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 1 of 44 <<>> inch diameter pipeline3 approximately 7.25 miles in length. The 7.25-mile route includes approximately 5.68 miles of submerged, buried pipe which will be located in offshore waters. The submerged portion of the Liberty Pipeline will utilize a pipe-in-pipe (PIP) design. The maximum water depth along the route is 19 feet at the LPDI. The Liberty Pipeline will transport crude oil. The 12.75-inch diameter carrier pipeline will be installed in 16-inch diameter casing pipe in the submerged offshore sections. The carrier pipeline and casing pipe will be bundled together with a 4.5 -inch diameter utility pipeline and a fiber optic communication cable during construction prior to placement in the seafloor, see Figure 1- Pipeline Bundle Cross Section, Page 36 of 44. Purpose and Need: Hilcorp's request for a special permit is for its planned Liberty Pipeline, specifically, the submerged PIP segments, and proposes waiving compliance from the following corrosion control sections of the Federal Pipeline Safety Regulations: 1) 49 CFR 195.563, Which pipelines must have cathodic protection? and 2) 49 CFR 195.573, What must I do to monitor external corrosion control? These Federal Pipeline Safety Regulations require hazardous liquid pipeline operators to have cathodic protection (CP) to prevent external corrosion and monitor the level of external corrosion control to ensure adequate protection of the pipeline. While PIP4 design is intended to prevent the creation of a corrosive environment, ifthere is a failure of either one ofthe pipes, a corrosive environment will occur and compliance with these federal corrosion regulations would not be possible. Furthermore, the PIP design and operating temperature differentials introduce atypical loads and strains to the pipeline, and presents pipeline condition assessment challenges that must be addressed to stay in full compliance. The purpose of the Liberty Pipeline special permit is to assure safety and environmental protection in lieu of compliance with these Federal Pipeline Safety Regulations. The 12.75-inch diameter pipeline may be referenced as "carrier pipe" or "carrier pipeline" throughout this document. The PIP reference means the 12.75inch diameter carrier pipe installed within the annulus ofthe 16-inch diameter casing pipe in the specialpermit segment. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 2 of 44 <<>> The special permit conditions are necessary to ensure the design, construction, and operation and maintenance (O&M) activities of the Liberty Pipeline are consistent with pipeline safety, specifically 49 CFR Part 195. The Liberty Pipeline will consist of a 12.75-inch diameter pipeline surrounded by an outer 16-inch diameter casing pipe. This PIP design creates a dry annulus that protects the carrier 12.75-inch diameter pipeline from exposure to electrolytes, such as sea water, saturated thermal insulation, or saturated soils. The special permit conditions apply to the design, construction, and O&M ofthe PIP system. Specifically, the special permit conditions address the possible introduction of an electrolyte around the carrier pipe, which could create an environment allowing corrosion to occur. Further, the special permit conditions provide a means for assessing the condition of the carrier pipe to ensure its integrity is maintained ifthe PIP system is compromised. Finally, the special permit conditions are necessary to allow Hilcorp to safely operate the specialpermit segment at a maximum operating pressure (MOP) of 1,480 pounds per square inch gauge (psig) and a maximum operating temperature of 150 degrees Fahrenheit (°F). I. Special Permit Segment: Beaufort Sea and North Slope Borouth, Alaska The Liberty Pipeline starts at the LDPI (an artificial island) and travels across Foggy Island Bay of the Beaufort Sea OCS, to the northern Alaskan coast line located west ofthe Kadleroshilik River Delta. The proposed Liberty Pipeline route and location can be reviewed on Figures 3 and 4 on pages 37 and 38 of 44. The Liberty Pipeline specialpermit segment includes the approximately 5.68 miles of 12.75-inch diameter carrier pipeline installed within a 16-inch casing pipe, the two (2) casing to carrier pipe "bulkhead" connections located on each end of the PIP segment, the 16-inch diameter casing pipe, and the connecting 12.75-inch diameter carrier pipeline from the 16-inch diameter casing pipe to the in-line inspection (ILl) tool launcher and receiver from approximate Milepost (MP) 0.02 and MP 7.25. The 16-inch diameter casing pipeline will create a sealed annular space between the casing pipe and carrier pipe using welded "bulkhead" connections located on each end of the PIP segment. The "Liberty Pipeline" refers to the entire approximately 7.25 miles of pipeline and supporting facilities that are jurisdictional to 49 CFR Part 195 PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 3 of 44 <<>> The special permit conditions require installation and operation of an ILl tool calibration spool, remote operated mainline valves located at MP 0.02 and MP 7.25, and ILl launchers and receivers. At the shore, the pipeline will transition to a single-wall, aboveground pipeline supported on vertical support members (VSMs) and continue south to tie into the existing Badami Pipeline. Product (crude oil) will be transported from the Liberty Pipeline through the Badami and Endicott Pipelines to the Trans Alaska Pipeline System (TAPS). PHMSA grants this special permit based on the findings set forth in the "Special Permit Analysis and Findings" document, which can be read in its entirety in Docket No. PHMSA- 2017-0091 in the Federal Docket Management System (FDMS) located on the internet at www.regulations.gov. The draft environmental assessment (DEA), which includes a plain-language explanation ofthe safety conditions, is included in the Docket at www.regulations.gov. II. Conditions: PHMSA grants this special permit for the specialpermit segment and the Liberty Pipeline6 subject to Hilcorp implementing the following conditions: General: 1) Applicable Regulations: The specialpermit segment and the Liberty Pipeline must be designed, constructed, operated and maintained in accordance with these special permit conditions and 49 CFR Part 195, with the exceptions of 49 CFR 195.563 and 195.573. In the event of a conflict between these special permit conditions and the applicable requirements under 49 CFR Part 195, the special permit conditions control. 2) Maximum Operating- Pressure, Temperature, Strain and Stress Limits for the Pipeline: Hilcorp must design, construct, and operate the specialpermit segment to meet the maximum operating conditions in Table 1: Liberty Pipeline- 12.75-inch Diameter Carrier Pipe Design Properties. The Liberty Pipeline specialpermit segment carrier pipeline MOP must not exceed 1,480 psig, including any surge pressures, and maximum temperatures must not exceed 150 °F in operating procedures and actual operations. 6 The special permit conditions are applicable to the O&M ofthe Liberty Pipeline that can affect the specialpermit segment. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 4 of 44 <<>> Table 1: Liberty Pipeline- 12.75-inch Diameter Carrier Pipe Design and Operating Properties Design and Operating Parameters Value Unit Flow Rate, maximum 70,000 barrels of oil per day (BOPD) ASME/ANSI Class Rating, minimum 600 n/a, rating is 1,480 psig MOP 1,480 psig Maximum/minimum Operating/Design Temperature -50 to 150 °F Normal Operating Pressure 0 to 1,000 psig Normal Operating Temperature 90 to 120 °F Maximum Allowable Combined Stress (Seq) 46,980 pounds per square inch (psi) Note: Liberty Pipeline specialpermit segment carrier pipe design must be based upon maximum operating conditions. Justification for any change in design and operating parameters in Table 1 must be provided to the PHMSA Western Region Director or Project Designee for review, and must receive a "no objection" letter prior to implementation. If Hilcorp does not receive a "no objection" letter from PHMSA within 90 days of the notification, Hilcorp may proceed. PUMSA will notify Hilcorp if additional review time is needed. 3) Integrity Management Program: Hilcorp must incorporate the specialpermit segment into its written integrity management program (IMP) as a "covered segment" in a "high consequence area (HCA)" or "could affect HCA" in accordance with 49 CFR 195.452. Design and Materials: 4) Design, Specifications and Procedures: Uilcorp must develop and implement design, construction, and O&M specifications and procedures in accordance with these special permit conditions and 49 CFR Part 195 for the specialpermit segment. These specifications and procedures must prevent stress7 and strain8 for the carrier pipe, carrier pipe girth welds, the casing pipe, and casing girth welds from exceeding the defined operational limits under the operational conditions for the specialpermit segment as outlined in Condition 2- Maximum Operating- Pressure, Temperature, Strain and Stress Limits for the Pipeline. Maximum allowable combined stresses are defmed in Table 1. 8 Strain is the longitudinal strain imposed on a pipeline by its surrounding environment (e.g., frost heave, thaw settlement, seismic, geologic fault areas, soil liquefaction areas, or soil movement areas). Strain is limited to the specific longitudinal strain value that cannot be exceeded, which for this special permit is 0.5% strain. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 5 of 44 <<>> 5) Pipe- Carrier:9 The Liberty Pipeline specialpermit segment carrier pipe must be manufactured per American Petroleum Institute Specification 5L (API 5L), Specification for Line Pipe,'° Grade X52 product specification level (PSL) 2, including supplementary requirements for offshore pipelines in API 5L Annexes J and K. The Liberty Pipeline special permit segment carrier pipe must be constructed of 12.75-inch diameter, 0.500-inch wall thickness, grade X52 or greater overall strength (wall thickness and grade combined), carbon steel pipeline. 6) Carrier Pipe Toughness: Charpy V-Notch (CVN) impact testing must be conducted on the carrier pipe in accordance with API 5L. Tests must be conducted on each carrier pipe steel heat and those test results must meet the following requirements: a) CVN impact test temperature must be negative 50 °F, and b) Minimum energy levels on full-size specimens must be 50 foot-pounds (ft-lb) average and 40 ft-lb minimum at negative 50 °F. Note: The pipe seam (weld centerline and heat affected zone) must be evaluated by C\TN impact tests if the pipe has a manufactured, longitudinal seam. 7) Carrier Pipeline Design Factor: The Liberty Pipeline specialpermit segment design must comply with 49 CFR 195.106, utilizing a design factor of 0.72 or more conservative for the carrier pipeline. The specialpermit segment bulkhead fitting and tie-in piping (2 pipe joints of each side of bulkhead for the 12.75-inch diameter carrier pipe) must be designed for a hoop stress design factor of 0.60 and a combined stress load design factor of 0.72; 8) Bends: The buried segments ofthe Liberty Pipeline specialpermit segment (carrier and casing) must not include manufactured or hot bent pipe bends. The transition segments at each end of the buried LSOP bundle (onshore transition segment and island transition segment) must gradually sweep to the surface. The directional changes of the pipeline must be designed to maintain combined stress levels within ASME B31.4-2016", section 403.3.1, Table 403.3.1-1 The Liberty Pipeline 12.75-inch diameter carrier pipe is used to transport crude oil and is subject to 49 CFR Part 195. The casing pipe is the 16-inch or larger diameter pipe that will be used as a double barrier to keep crude oil from getting into offshore waters ifthe carrier pipe leaks. 10 Hilcorp must use the edition noted for this standard that is incorporated by reference in 49 CFR 195.3. 1 Hilcorp may use the 2016 edition of ASME B3 1.4 as noted or may use the edition incorporated by reference in 49 CFR 195.3. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 6 of 44 <<>> allowable limits below 46,980 psi for API 5L X52 pipe12 (0.90 times the carrier pipeline minimum yield strength). 9) Flanges and Fittings: All flanges and fittings must comply with American Society of Mechanical Engineers (ASME)/American National Standards Institute (ANSI) B 16.5 and B l6.9,' respectively, for a ANSI Class 600 system and 1,480 psig or greater and must be designed based upon the maximum and minimum operating pressures and temperatures in Condition 2 and Table 1: Liberty Pipeline- 12.75-inch Diameter Carrier Pipe Design Properties. 10) CP- Carrier and Casing Pipe: The PIP portions of the Liberty Pipeline specialpermit segment will not have a CP system to protect the 12.75-inch diameter carrier pipe from corrosion. Corrosion protection is provided by the dual layer fusion bonded epoxy (FBE) coating and by maintaining a dry inert environment during construction and operations and the sealed 16-inch diameter casing (PIP seal) during operations. a) The 16-inch diameter casing must have a CP system that meets the requirements for a buried or submerged pipeline in 49 CFR 195.563. b) The CP system for the 16-inch diameter casing must be installed with a distributed galvanic anode system consisting of aluminum anodes spaced throughout the offshore subsea buried segment. c) The anodes must be connected to the 16-inch diameter casing and the weld area must be coated. d) The 16-inch casing must be externally coated for corrosion protection. The 16-inch diameter casing pipe must also be internally coated'4 with the exception of a short segment (less than 6-inches wide) at pipe girth welds. e) The 16-inch diameter casing must have equipment to monitor pressure and temperature of the PIP annulus at all times, except during equipment maintenance activities which must be completed within one 12-hour shift and with the knowledge of Liberty Pipeline controllers. 12 Carrier pipe must be manufactured in accordance with the incorporated by reference edition of API 5L specified in 49 CFR 195.3. 13 Hilcorp must use the editions noted for these standards that are incorporated by reference in 49 CFR 195.3. 14 The internal coating for the 16-inch diameter casing pipe must be a coating that protects against atmospheric corrosion such as Vaispar- Pipeclad Flowliner 93 OR. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 7 of 44 <<>> 11) PIP Design: The PIP design must have specifications and procedures implemented for the following: a) Casing isolators must be clamped to the 12.75-inch diameter carrier pipe to isolate it from the 16-inch diameter casing pipe. Spacing of the isolators must maintain separation between the 12.75-inch diameter carrier and 16-inch diameter casing pipe throughout the entire length of the PIP section. b) The PIP annulus'5 must be sealed at each end ofthe 16-inch diameter casing. c) The dew point'6 ofthe inert gas in the annulus must be sampled prior to commissioning of the PIP system. The dew pointofthe inert gas must be maintained at negative 10°F or lower at all times. d) The annulus must be filled with an inert gas, such as nitrogen or argon. e) The PIP annulus must be connected to a vacuum system to maintain the annular back- pressure. The annular space must be maintained below atmospheric pressure at negative 10 psig or less at all times. f) The vacuum system must be connected to the 16-inch diameter casing pipe at the LDPI. The vacuum system must include block valves, a pressure regulator, pressure relief valves, a vacuum pump, sample ports, and associated piping. The vacuum system must be operational at all times, except during maintenance activities which must be conducted during one 12-hour shift and with the knowledge of Liberty Pipeline controllers. g) The annulus must be monitored for pressure and temperature changes that would indicate changes in the gas composition in the annulus. h) Pressure transmitters to monitor pressures of fluids or gases in the annulus must be placed at each end of the PIP annulus system above ground at LDPI (MP 0.02) and above ground at the Alaska shoreline (MP 5.7) 15 "PIP annulus," "annulus," or "annular space" refers to the space between the carrier pipe and the casing pipe. 16 Typically, for corrosion to occur, it requires an electrolyte (such as water) and air to be present. The inert gas in the annulus significantly reduces the potential for external corrosion on the NPS 12 LSOP by removing the oxygen from the surface ofthe carrier pipe. The inert gas will also be unsaturated, or dry, with a dew point sufficient to keep any water from dropping out of the gas for all operating temperatures ofthe PIP system. Corrosion generally is inhibited when the relative humidity is maintained below 30%. To account for potential presence of hygroscopic dirt, a minimum relative humidity of 20% is recommended for this application. The PIP system will be installed in a subsea trench where the lowest ambient conditions are above 25 °F. The effective dew point at 20% relative humidity and 25°F is -7 °F. Therefore, a -10 °F dew point should be sufficient to prevent liquid drop out as low as 25 °F. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 8 of 44 <<>> i) Temperature transmitters to monitor temperature of the annular space must be placed at each end of the PIP annulus system, one (1) above ground at LDPI and one (1) adjacent to the onshore PIP transition. 12) PIP Bulkhead Design: Hilcorp plans to rigidly connect the 16-inch diameter casing pipe and the 12.75-inch carrier pipeline by means of a forged bulkhead, similar to what is presented in Figure 2 on page 36 of 44¯17 The bulkheads must be placed above grade where the alignment transitions from buried to aboveground installation. Installation of the bulkheads must create a sealed annulus between the 12.75 -inch diameter carrier pipeline and the 16-inch diameter casing pipe. a) The PIP bulkhead design must meet both 49 CFR 195.106, Internal Design Pressure, and ASME B3 1.4 -2016, Table A402.3.5-1, Design Factorsfor Offshore Pipeline Systems. The bulkhead design and connecting piping must be treated as piping on an offshore platform for determining hoop, circumferential, and combined stresses. b) The PIP bulkhead must be hydrostatically tested by the manufacturer in accordance with the Design Proof-Test requirements of the Manufacturers Standardization Society ofthe Valve and Fittings Industry, Inc., MSS SP-75-2014 High-Strength, Wrought, Butt-Welding Fittings or ASME B 16.9-2012 Factory-Made Wrought Butt-welding Fittings, in accordance with 49 CFR 195.118.18 The PIP bulkhead must be pressure tested with the pipeline after onsite iiistallation in accordance with 49 CFR 195.304 and 195.306. c) d) The PIP bulkhead fitting must be designed for: i) Loads: thermal force, pressure force, cap force, and friction force; ii) Design Safety Factor for all Combined Stress loads must not exceed: 0.72; iii) Design Factor for Hoop Stress must not exceed: 0.6; and iv) Minimum Factory Test Pressure: 5,700 psig for continuous 4-hours minimum. PIP bulkhead and pipeline loads must be analyzed using Finite Element Analysis (FEA) for the carrier pipeline, casing and bulkhead operating conditions, and design safety factors 17 Hilcorp may use another method of sealing the PIPdesign instead ofthe bulkhead outlined in Figure 2, but any design must meet 49 CFR Part 195 and these specialpermit conditions. Hilcorp must give PHMSA Western Region Director or Project Designee notice of any changes to the sealing method for the PIP design and must get a "no objection" letter from PHIvISA ofthe sealing method. If Hilcorp does not receive a "no objection" letter from PHIvISA within 90 days of the notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. 18 Hilcorp may use the editions noted for these standards (2014 and 2012) or may use the edition incorporated by reference in49CFR 195.3. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 9 0144 <<>> over the life span ofthe Liberty Pipeline specialpermit segment. The FEA must meet the design factors listed in Condition 12(c). 13) Bundle and Fiber Optic Cable: The offshore subsea buried specialpermit segment will be installed as a bundle. The bundle will consist of the PIP system, utility line, fiber optic cable, spacers and bundle straps. See Figure 1 on page 36 of 44 for a conceptual cross section of the Liberty Pipeline bundle. Note: The fiber. optic cable will be located outside ofthe PIP system. The fiber optic cable is not within the 16-inch diameter casing. a) The fiber optic cable must be installed with accurate distributed temperature sensing (DTS) capability to allow for the immediate identification of any areas experiencing changes in soil temperature. The fiber optic cable must be operational at the time the Liberty pipeline is placed into crude oil service. b) The fiber optic cable must be installed with DTS instrumentation, capable of detecting and locating temperature anomalies within five (5) feet.19 c) The DTS system must be able to sense all temperatures within the pipeline design capacity d) The temperature profile ofthe bundle must be transmitted to the supervisory control and data acquisition (SCADA) system for continuous monitoring and recording. e) The 4.5-inch utility line shown in Figure 1 is not part ofthe special permit or the special permit conditions. The 4-inch utility must comply with current Federal Pipeline Safety Regulations, and Hilcorp must notify PHMSA in accordance with 49 CFR 191.22(c) prior to placing it into 49 CFR Parts 192 or 195 service. f) The depth of cover for the bundle must be a minimum of seven (7) feet below the subsea mudline for the offshore subsea buried segment of the Liberty Pipeline specialpermit segment bundle; with the exception to the two (2) transition segments where the buried piping transitions to the surface. 14) Pipe- External Coating: Carrier and casing pipe must have an external coating system that consists of an external dual layer of Fusion Bonded Epoxy (FBE) coating. The dual layer FBE 19 Ifthe fiber optics cable should fail during the 12.75-inch diameter pipeline operational life, Hilcorp must develop and implement alternative operational procedures that maintain a similar level of safety and environmental protection. Hilcorp must submit these procedures and an implementation schedule to PHMSA Western Region Director or Project Designee and receive a response of "no objection" prior to implementation. If Hilcorp does not receive a "no Objection" letter from PHMSA within 90 days ofthe notification, Hilcorp may proceed. PHMSA will notiQj Hilcorp if additional review time is needed. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 10 of 44 <<>> consists of one (1) layer of standard FBE covered with a minimum of one (1) layer of an abrasion resistant overlay (ARO) to protect the primary FBE layer. The external pipe coating system must be applied to the Liberty Pipeline specialpermit segment in accordance with a coating. application specification that addresses: a) pipe surface cleanliness standards, b) blast cleaning, c) application temperature control, d) adhesion for coating to pipe, e) cathodic disbondment, f) moisture penneation, g) bending, h) minimum coating thickness, i) coating imperfection, and j) coating repair. 15) Monitoring System: The Liberty Pipeline specialpermit segment carrier pipe must be monitored for operating pressure, temperature, and flow rate, including the following requirements: a) Pressure transmitters must be placed at each end of the Liberty Pipeline, one (1) at LDPI and one (1) at the pipeline tie-in at the Badami Pipeline. b) Flow meters must be placed at each end ofthe Liberty Pipeline, one (1) at LDPI and one (1) at the pipeline tie-in at the Badami Pipeline. c) Temperature transmitters must be placed at each end ofthe Liberty Pipeline, one (1) at LDPI and one (1) at the pipeline tie-in at the onshore Badami Pipeline. d) Valves at LDPI and at the pipeline tie-in at the Badami Pipeline must be remote closure and have pressure monitoring on both sides of the valves. The actuation of the valves may not result in an overpressure event of the carrier pipeline, and closure rates must be substantiated by a hydraulic surge analysis. The remote closure valve status and adjacent pipeline pressures must be monitored at all times, except during scheduled equipment maintenance activities, which must be completed within a 12-hour shift and with the knowledge of Liberty pipeline controllers. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 11 of 44 <<>> 16) Casing Pipe- Design and Operating Properties: The 16-inch diameter casing design properties must be as shown in Table 2 below.20 Table 2: Liberty Pipeline- 16-inch Diameter Casing Design and Operating Properties Design and Operating Parameter Value Unit Minimum Design Pressure 1,480 psig DesignlOperating Temperature Range -50 to 150 °F Normal Operating Pressure -20 to 50 psig Normal Operating Temperature 60 to 90 °F Maximum Allowable Combined Stress (Seq) 46,980 psi Relief Valve- Annulus 25 to 50 psig a) The casing pipe must be a minimum of 16-inch diameter, 0.625-inch wall thickness, carbon steel pipeline manufactured per API Specification 5L, Specificationfor Line Pipe,2' Grade X52, PSL 2, including supplementary requirements for offshore pipelines (API 5L Annexes J and K). The casing pipe may be of a larger diameter, thicker wall thickness, or higher strength (grade) to maintain equivalent strength (a minimum design pressure of 1,480 psig). b) Charpy V-Notch (CVN) impact testing must be conducted on the casing pipe in accordance with API Specification 5L Annex G, with the following modifications: i) CVN impact test temperature must be negative 50 °F; and ii) Minimum energy levels on full-size specimens must be 50 ft-lb average and 40 ft-lb minimum. c) The 16-inch diameter casing must be coated with an external coating system. The coating system must be installed in accordance with Condition 17(b). d) The casing pipe overpressure relief valve data and/or annulus pressure data must be transmitted to the SCADA system to ensure timely pipeline shutdown should the annulus pressure exceed the established pressure thresholds in Table 2. Construction: 20 Justification for any change in the design and operating parameters in Table 2 must be provided to the Western Region Director or Project Designee for review, and must receive a "no objection" letter prior to implementation. IfHilcorp does not receive a "no objection" letter from PHMSA within 90 days ofthe notification, Hilcorp may proceed. PHMSA will notifi Hilcorp if additional review time is needed. 21 Hilcorp must use the API 5L edition incorporated by reference in 49 CFR 195.3. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 12 of 44 <<>> 17) Construction Quality Control: Hilcorp must develop and implement a right-of-way (ROW) construction monitoring program and a pipeline construction quality control program for the Liberty Pipeline specialpermit segment, as specified below: a) ROW Construction Monitoring Program: A ROW construction monitoring program must include procedures, personnel training, and be implemented for all construction phases of construction. The ROW construction monitoring program must include procedures for: i) Operator Qualification (00) Procedures: OQ Procedures must be developed and implemented for construction tasks that can affect pipeline integrity in compliance with 49 CFR 195.501. ii) Construction Quality Assurance Plan and Procedures: Hilcorp must develop a Construction Quality Assurance Plan and corresponding Procedures that establish the project quality objectives and personnel accountabilities to construct the pipeline system as designed. The Construction Quality Assurance Plan and Procedures, at a minimum, must include procedures, specifications, and personnel training for: 1) pipe inspection, 2) hauling and stringing pipe, 3) welding, 4) non-destructive examination of girth welds, 5) applying and testing field applied coating, 6) lowering the pipeline into the subsea trench, 7) backfilling, and 8) hydrostatic testing including dewatering and drying. iii) Subsea Trench Quality Plan and Procedure: Hilcorp must develop a Subsea Trench Quality Plan that provides quality objectives to ensure the pipeline system is placed in the subsea trench as designed. At a minimum, the Subsea Trench Quality Plan and Procedure must include quality assurance/control for: 1) periodic collection of samples oftrench spoils to test for chemical and electrical properties related to pipe corrosion, 2) trench depth monitoring, 3) trench bottom roughness profiling, and PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 13 of 44 <<>> 4) backfihling requirements. b) Carrier and Casing Pipe Construction Quality Control Programs: i) Coatings for Carrier and Casing Pipe: A coating application quality control specification must be developed, implemented, and personnel must be trained to ensure carrier and casing pipe surface cleanliness, application temperature control, adhesion quality, cathodic disbondment, moisture permeation, bending, and minimum coating thickness for girth weld and repair coatings. Both the carrier and casing pipe must be externally coated for corrosion protection. ii) Non-Shielding Coatings: Pipe, girth weld, and repair coatings must be non-shielding to CP. Shielding coatings such as tape or shrink sleeves must not be used. iii) Pipe Protection: Pipe end protection caps must be installed on the pipe joint weld bevels during the storage, handling, transport, and staging for all ofthe pipe included in the pipeline bundle to reduce the introduction of foreign materials including snow, ice, and water. 18) Carrier Pipeline Girth Welds: All girth welding procedures for the 12.75-inch carrier pipe must be in accordance with 49 CFR 195.2 14 that incorporates by reference, API Standard 1104.22 a) All pipeline girth welds must be non-destructively tested to meet 49 CFR 195.228, 195.230, and 195.234. b) All pipeline girth welds with any type crack must be cut-out prior to placing the carrier into service with crude oil. c) The 12.75-inch carrier pipe and coating must be protected from any weld splatter or other damage during welding of the 16-inch casing pipe. 19) Casing Pipe Girth Welds: All casing pipe girth welding procedures must be in accordance with 49 CFR 195.214 and API Standard 1104.23 a) All casing pipe girth welds must be non-destructively tested to meet 49 CFR 195.228, 195.230 and 195.234. 22 Hilcorp must use the API 1104 edition incorporated by reference in 49 CFR 195.3. 23 Hilcorp must use the API 1104 edition incorporated by reference in 49 CFR 195.3. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 14 of 44 <<>> b) All casing pipe girth welds with any type crack must be cut-out prior to placing the 12.75- inch diameter carrier pipe into operational service with crude oil. 20) Casing Isolators: The Liberty Pipeline specialpermit segment must be supported by casing isolators at regular intervals throughout the PIP portion of the specialpermit segment. A maximum casing isolator spacing interval of 10-feet or less must be used to minimize lateral deflection between isolators, prevent contact between the casing and carrier pipes, provide structural integrity ofthe PIP design during unexpected ground movement or creation of unsupported spans caused by localized seafloor scour, and to accommodate cyclic, thermally induced movement of the carrier pipe relative to the casing. The casing isolator spacing should facilitate installation of the carrier pipe within the casing. The casing isolators must consist of two high-density polyethylene half-shells with a continuous temperature rating of 225°F or greater so that the isolators will not lose structural integrity or degrade under loading or temperature conditions for the life of the pipeline. 21)Relief Storage Tank: The PIP annulus of the Liberty Pipeline specialpermit segment must be configured so that any excessive pressure (as monitored under Condition 11) resulting from either crude oil or seawater entering the annulus can be discharged from an annulus relief valve (see Table 2 for relief set pressure ranges) to either a "breakout tank, a portable tank, drum and flare system, or other pipeline" (relief storage tank) that operates at a pressure that is not higher than the 16-inch diameter casing maximum annulus relief valve pressure setting in Table 2. The relief storage tank must facilitate the removal of liquids from the annulus in an event the annulus relief valve discharges. The relief storage tank capacity must be based upon the time to shut-down and isolate the carrier pipeline and maximum flow volumes (see Condition 16(d). O&M: 22) O&M Procedures: In addition to the O&M procedures otherwise required by 49 CFR Part 195, Hilcorp must develop and implement O&M procedures for the specialpermit segment and the Liberty Pipeline, including the following: ¯ CP monitoring system on the 16-inch diameter casing pipe, ¯ PIP annulus monitoring, ¯ SCADA System for the Liberty Pipeline and PIP System, ¯ Integrity Management Plan for the 12.75-inch diameter pipeline and 16-inch diameter casing, and PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 15 of 44 <<>> a) b) c) . Data Integration Plan and Procedures to monitor and remediate any corrosion or excessive strains on the 12.75-inch diameter pipeline or 16-inch diameter casing pipe. O&M procedures for the specialpermit segment and the Liberty Pipeline must technically assess all operating parameters that have an effect on the implementation of, or compliance with, all ofthese specialpermit conditions; including, but not limited to: i) maximum and minimum pressures, ii) pipe corrosion, iii) oil and environmental (soil) temperatures, and iv) maximum and minimum operating temperatures ofthe carrier pipe and casing pipe. Procedures for the carrier pipeline in the specialpermit segment must be developed and implemented to ensure the following conditions are evaluated: i) the effects of corrosion anomalies (defects), ii) the effects of mechanical damage (such as dents and gouges), iii) the effects of cracking on the stress and strain capacity of the pipe, casing, and girth welds, iv) the effect oftensile and compressive strainlstress capacity on anomalies in assessing pipeline integrity and fitness for service, v) the effects of corrosion anomaly interaction criteria of a minimum of 6t (where t is the pipe wall thickness) must be used for longitudinal and circumferential wall loss,24 and vi) the determination ofthe nature, growth parameters, and location of all strain demand events (e.g., frost heave, thaw settlement, seismic, geologic fault areas, soil liquefaction areas, or soil movement areas). Develop and implement procedures for strain demand monitoring systems, including the scheduling and selection of ILl tools, as specified in Condition 23- Monitoring and Determination of Pipeline Strains, to verify the reliability and accuracy of these procedures. The strain demand monitoring procedures must: i) demonstrate that strain demand monitoring systems are technically justified for estimation of actual strain demand levels (tensile, compressive, and combined), 24 Other anomaly interaction criteria may be used if engineering analysis shows they are more conservative than the required criteria. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 16 of 44 <<>> ii) ensure strain demand from the monitoring systems have the comparable level of accuracy and resolution as the strain capacity so the strain demand can be compared consistently to the strain demand limit, and iii) include a requirement that when pipe strain magnitude greater than 0.5% is determined, the pipeline must be monitored or remediated in accordance with integrity remediation measures specified in Condition 23. d) Develop and implement material properties surveillance procedures for any time-dependent degradation mechanisms found during material testing, construction, or ongoing operations that may affect the specialpermit segment. 23) Monitoring and Determination of Pipeline Strains: The Liberty Pipeline specialpermit segment must be monitored for strain by evaluation of inline inspection tool data and as follows: a) b) c) d) Strain Monitoring Process and Devices: When locations of high strain25 are discovered after the Liberty Pipeline is placed into service, strain demand monitoring processes or devices must be installed and implemented. The processes or devices must be installed or implemented, as applicable, either during construction (e.g., fiber optical cable) or during operation (inertial measurement unit (IMU), ground surveys, and aerial surveys). Strain Monitoring Procedures: Hilcorp must create strain demand monitoring procedures that take into account the limitations, accuracy, strain demand seasonal and location variability, and measurement intervals of the strain measurement. If monitoring devices have directional or accuracy limitations that cannot be offset through tolerances and safety factors in the procedures, multiple devices or processes for monitoring must be used. Unless the ILl is performed during the time of year when the peak strain is expected, the procedures must also account for potential seasonal variation in strain demand. Strain Trending: Data acquisition and analysis must be performed frequently enough to ensure the strain demand limit is not exceeded before mitigation measures can be implemented. The frequency of monitoring may be adjusted based on procedures using site- specific strain growth rate calculations with safety factors. Site Specific Strain Data Requirements: Whenever high strain conditions are identified, Hilcorp must evaluate the site-specific strain. For the strain limit evaluation, the site-specific data must include actual pipe geometry, stress-strain data, yield strength to tensile strength 25 High strain is defined as a strain magnitude greater than the value corresponding to a longitudinal stress of 0.8 SMYS. PHMSA-2017-0091, Hhlcorp- Liberty Pipeline- Special Permit Page 17 of 44 <<>> (YIT) ratios, construction weld records, NDE results, and other recorded data that affects the strain capacity. e) Site-Specific Geotechnical Data Requirements: Whenever high strain conditions are identified, Hilcorp must evaluate and remediate, as necessary, the site-specific strain demand. For the strain demand evaluation, the site-specific geotecimical data must include burial depth, soil type, subsurface temperature infonnation, water table height, and other recorded data that contributes to the evaluation and understanding of strain demand and strain growth at this location. If site-specific geotechnical data is not available, engineering evaluations must be used to assess future strain demand growth.26 The site-specific strain demand model must be calibrated to the pipeline strain measured at the high-strain location. Hilcorp must request a "no objection" letter from PUMSA's Western Director or Project Designee for procedures using engineering evaluations rather than site-specific geotechnical data prior to implementation. If Hilcorp does not receive a "no objection" letter from PHMSA within 90 days of the notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. f) Geospatial Pipeline Mapping: Multi-dimensional geospatial pipeline mapping ILl (mapping ILl) tools must be run through the entire specialpermit segment. The mapping ILl tools (e.g. IMU) must be capable of mapping the pipeline location based upon its plan, elevation, and distance. The mapping ILl tools must be capable of mapping such features as pipeline alignment and the direction and orientation of horizontal and vertical with respect to angle, radius, direction, and location. To allow for accurate usage of engineering critical assessment (ECA) and to ensure O&M procedures for pipe and casing strains are capable of identifying and locating high-bending pipe and casing strain conditions, the mapping ILl tool must be able to meet the performance parameters listed in Table 3: Summary of Bending Strain IL! Tool Performance. Conditions that can cause additional stresses or strains on girth welds, but that are not measurable from mapping ILl tools, must be technically considered in the weld integrity evaluation. 26 Procedures using conservative values must receive a response of"no objection" from PHMSA's Western Director or Project Designee prior to implementation. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 18 of 44 <<>> Table 3 Summary of Bending Strain ILl Tool Performance Bending Strain"2 Detection Threshold- Probability of Detection (POD) 90% 0.1% maximum Accuracy +1- 0.05% ReportingThreshold 0.125% strain Notes: 1. All values given for 80% certainty. 2. For maximum reported strain values 2%. g) Alternative Strain Demand Monitoring Methods: Hilcorp must report and remediate high- strain conditions, as specified in Table 4: Pipeline Segment Strain Demand Monitoring. Alternatively, Hilcorp can propose a different strain-demand monitoring approach. The justification for any alternative strain demand monitoring approach must be sent by Hilcorp to an independent third-party engineering/expert firm for review and then to the PHMSA Western Region Director or Project Designee for review and Hilcorp must receive a response of "no objection" prior to implementation. If Hilcorp does not receive a "no objection" letter from PHMSA within 90 days of the notification, Hulcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 19 of 44 <<>> Table 4 Pipeline Segment Strain Demand Monitoring Strain Demand Magnitude that Triggers Action Action Required27 Level Strain Demand Greater than 0.16% but less than 0.37% Monitor longitudinal strain Greater than 0.37% but 2 less than 0.45% longitudinal strain Equal to or greater than 3 0.45% longitudinal strain Monitor, Report, and Develop a site-specific strain growth rate and corresponding remediation plan to ensure the strain demand limit is not reached durmg the pipe's operational life. A remediation plan must be developed within one (1) year of the date of discovery p prior to the date when the strain demand limit is expected to be exceeded, whichever is sooner. Report and Remediate strain findings to the PHMSA Western Regional Director or Project Designee within five (5) days of discovery. Develop a remediation plan and submit it to PI-IMSA within 30 days of discovery. The remediation plan is to be implemented within one (1) year ofthe date of discovery or 90 days prior to the date when the strain demand limit is expected to be exceeded, whichever is sooner. 24) Integrity Assessments: Pipeline integrity assessments must be performed along the entire Liberty Pipeline specialpermit segment using ILl tools as follows: a) Pre-Commissioning Assessment: A pre-commissioning assessment is required prior to placing the Liberty Pipeline into service or prior to raising the temperature above ambient temperature conditions. The commissioning assessment must include: 27Hi1corp must submit the Level 2 and 3 monitoring procedures and plans to the PHMSA Western Region Director or Project Designee and receive a response of"no objection" prior to implementation. PHIvISA may also require an independent third-party engineering expert/finn review. IfHilcorp does not receive a "no objection" letter from PHMSA within 90 days ofthe notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. Level 1 monitoring procedures and plans require no reporting to PHMSA Western Region Director or Project Designee. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 20 of 44 <<>> i) High Resolution Deformation (HR-Deformation) ILl survey utilizing deformation sensing fingers located outside the tool cups, ii) multi-dimensional geospatial pipeline mapping tool, and iii) confirmation that any anomalies defined in 49 CFR 195 .452(h) or other known injurious anomalies have been remediated prior to commissioning lacing crude into the pipeline) the Liberty Pipeline in accordance with 49 CFR 195.401(b), 195.422, 195.452(h), and 195.585. All specialpermit segment carrier pipe denting located in the PIP must be treated as a top side (above the 4 and 8 o'clock positions) dent for scheduling remediation as required in 49 CFR 195 .452(h).28 b) Baseline Assessment: Within one (1) calendar year, not to exceed 15 months, of placing the Liberty Pipeline into service, Hilcorp must perform a baseline assessment ofthe Liberty Pipeline specialpermit segment. The baseline assessment must use, at a minimum, the following ILl devices: i) High Resolution (HR) for Metal Loss, ii) HR-Deformation ILl survey utilizing deformation sensing fingers located outside the tool cups, and iii) multi-dimensional geospatial pipeline mapping tool. c) Second Assessment: A second ILl integrity assessment must be conducted within 36 months, not to exceed 39 months, after placing the pipeline into service. The second ILl assessment must use, at a minimum, the following ILl devices: i) an ultrasonic (UT) technology to determine metal loss and cracking,29 ii) a HR-deformation ILl survey utilizing deformation sensing fingers located outside the tool cups, and iii) Multi-dimensional geospatial pipeline mapping tool. d) Periodic Assessments: After the second ILl integrity assessment (Condition 24(c)), Hilcorp must perform ILl assessments at two (2) calendar year intervals. Hilcorp may conduct ILl assessments up to a maximum of three (3) calendar years, not to exceed 39 months. While the maximum interval between ILl assessments is three (3) calendar years, not to exceed 39 28 Specialpermit segment carrier pipe denting or other deformations in the cased pipeline, PIP, would indicate the presence of unanticipated integrity-threatening forces and strains. 29 UT ILl crack detection tool is not required for the 2nd Assessment Period unless the Baseline ILl tool runs detect denting (2 percent or greater) or the carrier pipe is touching the casing pipe. A UT ILl crack detection tool must be run during the 4th Assessment Period, if it has not been previously run. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 21 of44 <<>> e) f) months, a 3 -year interval should only be utilized if it is supported by existing ILl data, data integration results, and the Liberty Pipeline Comprehensive Risk Assessment (CRA). i) Hilcorp must use the CRA to determine ifthe ILl assessment interval can be extended from atwo (2) to a three year (3) assessment interval only ifthe CRA shows no increased risk through data integration and application of integrity management risk assessment models. ii) Each ILl assessment must include, at a minimum: 1) HR for Metal Loss, 2) HR-Deformation, and 3) Multi-dimensional geospatial pipeline mapping inspections. iii) In order to extend the ILl assessment interval longer than three (3) years, Hilcorp must receive a "letter of no objection" letter from the PHMSA Western Region Director or Project Designee. IfHilcorp does not receive a "no objection" letter from PHMSA within 90 days of the notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. ILl Tool Types: A UT ILl tool must be run at least every other integrity assessment. If any pipe cracking is found through ILl tool surveys, direct inspection or examination of the pipe, the subsequent ILl tool surveys must utilize an UT crack ILl tool. The pipeline operator may select an alternate tool technology as superior tools are made available through technology improvements, but must obtain a "no objection" letter from PHMSA Western Region Director or Project Designee. If Hilcorp does not receive a "no objection" letter from PHMSA within 90 days of the notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. Hilcorp Alaska must report the ILl tool used for integrity assessments in the annual report. Calibration Spool: Hilcorp must install a calibration spool (on the downstream side of the PIP) in the 12.75-inch diameter mainline carrier pipe to detect general corrosion, pitting, and cracks with known defects (type, length, width, and depth). This installation must be downstream of the PIP segment and near the pig receiver location. ILl calibration spools must replicate the conditions of the cased 12.75-inch diameter carrier pipe, and must include at least one insulator and a girth weld to ensure that the ILl tool inspection signals accurately portray the PIP conditions. Hilcorp must request a "no objection" letter prior to implementation of any pre-built, calibrated pipe segments and procedures from PHMSA's PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 22 of 44 <<>> Western Director or Project Designee. If Hilcorp does not receive a "no objection" letter from PHMSA within 90 days of the notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. g) Denting or Wrinkling Assessments: In the event of contact between the12.75-inch diameter carrier and 16-inch diameter casing pipe, Hilcorp must run an HR-deformation ILl tool and multi-dimensional geospatial pipeline mapping ILl tool to identify any denting or wrinkling. Hilcorp must perform an assessment ofthe findings (stress, strain, denting and movement) and respond in accordance with response and remediation procedures defined in this special permit. h) Anomaly Repair: Any anomalies defined in 49 CFR 195 .452(h) or other known injurious anomalies found during ILl tool runs or other O&M activities on the carrier pipeline must be remediated in accordance with 49 CFR 195.401(b), 195.422, 195.452(h), and 195.585 and must take into account surge pressures in determining any temporary pressure reductions. i) Hilcorp must treat as an immediate repair condition to meet 49 CFR 195 .452(h)(4)(i)(A) or (B) any 12.75-inch diameter carrier pipe specialpermit segment corrosion anomaly that has wall loss greater than 70% of nominal pipe wall thickness or has a failure pressure ratio that is below a pressure of 1.10 times "maximum operating pressure plus maximum surge pressure." ii) All specialpermit segment carrier pipe denting located in the PIP must be treated as a top side (above the 4 and 8 o'clock positions) dent for scheduling remediation as required in 49 CFR 195.452(h).3° iii) Hilcorp must evaluate corrosion anomalies found during ILl tool runs or other inspections and develop growth rates to ensure they are repaired prior to reaching "immediate" repair status as defined by this Condition 24(h). 25) Inline Inspection Tool Tolerance: In the specialpermit segment Hilcorp must account for ILl tool tolerance and corrosion growth rates in scheduled response times and repairs, and must document and justify the values used. a) Hilcorp must demonstrate ILl Tool tolerance accuracy for each ILl Tool run by usage of ° Specialpermit segment carrier pipe denting or other deformations in the cased pipeline, PIP, would indicate the presence of unanticipated integrity-threatening forces and strains. PHMSA-2017-0091, Hilcorp-Liberty Pipeline- Special Permit Page 23 of 44 <<>> calibration spools31 and unity plots that demonstrate ILl Tool accuracy to meet the tool accuracy specification provided by the vendor (typical for depth within +10% accuracy for 80% of the time). Hilcorp must incorporate ILl Tool accuracy by ensuring that each ILl Tool service provider determine the tolerance of each tool and includes that tolerance in determining the size of each anomaly feature reported to Hilcorp. Hilcorp must compare previous indications to current indications that are significantly different. If a trend is identified where the tool has been consistently overcalling or under-calling, the remaining ILl features must be re-graded accordingly. The unity plots must show the actual anomaly depth versus predicted depth. b) ILl Tool evaluations using high resolution magnetic flux leakage (HR-MFL) technology must be evaluated for metal loss using "6t x 6t"32 interaction criteria for determining anomaly failure pressures and response timing. c) Discovery date33 must be within 90 days of any ILl Tool run (e.g. HR-deformation ILl tools, high resolution HR-MFL ILl tools, or multi-dimensional geospatial pipeline mapping ILl tools). 26) Engineering Critical Assessment for Cracks: If cracks are found in the 12.75-inch diameter pipe, Hilcorp must evaluate the cracks using Appendix A- Engineering Critical Assessment for cracks up to 50% through wall thickness. Any crack over 50% wall thickness or with a failure pressure ratio34 less than 1.25 must be treated as an "immediate response" and all other cracks must be remediated based upon a 49 CFR 195.452(h) response times. 27) Leak Detection System: The leak detection system (LDS) for the Liberty Pipeline must include operational procedures and monitoring of the 12.75-inch diameter pipeline, the PIP annulus, and the fiber optic cable. included in the pipeline bundle. Leak detection methods must include a computational pipeline monitoring (CPM) LDS, in accordance with 49 CFR 195.444. The LDS 31 Calibration spools must have known dimensions of length, depth and width for anomaly features, such as general corrosion, pitting, cracks; gouges, and denting. Any pre-built, calibrated pipe segments and procedures used, Hilcorp must request and receive a "no objection" letter from PHMSA's Western Region Director or Project Designee prior to implementation. If Hilcorp does not receive a "no objection" letter from PHMSA within 90 days ofthe notification, Hilcorp may proceed. PHMSA will notiQ,' Hilcorp if additional review time is needed. 32 "6t" means pipe wall thickness times six. Discovery date is the day, month and year that Hilcorp receives the ILl Tool run results from the ILl Tool service provider. A failure pressure ratio is the anomaly failure pressure divided by the Liberty Pipeline MOP. PHMSA-2017-0091, llhlcorp- Liberty Pipeline- Speeial Permit Page 24 of 44 <<>> must include three (3) independent leak detection methods for the Liberty Pipeline: a mass balance system including flow meters at the LDPI and the BSOP tie-in; PIP annulus monitoring system; and temperature monitoring ofthe subsea bundle through the fiber optic cable. a) Mass Balance System: The primary leak detection method for the Liberty Pipeline must be a mass balance system monitoring pressure, temperature, and flow rates between metering stations. Pressure transmitters, temperature transmitters and flow meters must be located at each end of the Liberty Pipeline, above ground at the LDPI and above ground at the Badami Pipeline tie-in. i) Data from the transmitters must be transmitted to the SCADA system for analysis. b) PIP Annulus System Design for Secondary Leak Detection: The PIP aimulus pressure and temperature must be monitored for changes that would indicate loss of PIP containment whether through the 12.75-inch diameter carrier pipe or 16-inch diameter casing pipe. i) Annulus Pressure: The PIP annulus must be monitored for indications of rising interstitial pressure. Pressure transmitters must be installed on the 16-inch diameter casing at each end of the PIP annulus, above ground at LDPI, and above ground at the Alaska shoreline. i. Pressure transmitters, as described in Condition 11(h), must be monitored for changes in pressure that may indicate leakage of oil or seawater into the annulus, or leakage ofthe inert gas from the annulus. ii. Pressure measurements of the annulus must be transmitted to the SCADA system for real time monitoring and recording. ii) Annulus Temperature: The PIP annulus must be monitored for indications of changes in the interstitial temperature. i. Temperature transmitters, as described in Condition 11(i), must be installed on the 16-inch diameter casing at each end of the PIP annulus, above ground at LDPI, and above ground at the Alaska shoreline. ii. Temperature measurements of the annulus must be transmitted to the SCADA system for real time monitoring and recording. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 25 of 44 <<>> c) Fiber Optic Cable: A fiber optic cable must extend between the LDPI and the onshore Badami Pipeline tie-in. The fiber optic cable must transmit data from the multiple sensors and flow computers to the leak detection software of the SCADA system.35 The LDS must perform mass balance calculations and have remote operation of the tie-in pad valves capabilities. 28) Monitoring Systems- Carrier Pipe, Casing Pipe and PIP Annulus: Hilcorp must develop and implement monitoring systems and procedures for the 12.75-inch diameter carrier pipe, 16-inch diameter casing pipe and annulus for pressure, temperature, settlement, flow, and dew point monitoring, as follows: a) Carrier Pipe- Pressure, Temperature, Settlement, and Flow Rate Monitoring: i) Pressure monitoring equipment, as described in Condition 15(a), must transmit data to the SCADA system for real time monitoring and recording. ii) Temperature monitoring equipment, as described in Condition 15(c), must transmit data to the SCADA system for real time monitoring and recording. iii) A pipeline settlement protection system procedure must be developed and implemented to prevent the operating temperature from exceeding the design limit so thaw settlement limits are not exceeded. iv) Flow rate metering equipment, as described in Condition 15(b), must transmit data to the SCADA system for real time monitoring and recording. Flow and mass balance loss procedures must be developed and implemented to detect loss of crude oil from the carrier pipeline on a real time basis that is monitored through SCADA. b) Casing Pipe and PIP Annulus- Pressure, Temperature, and Dew Point Monitoring: i) Pressure monitoring equipment on the 16-inch diameter casing must transmit data to the SCADA system for real time monitoring and recording.36 The PIP annulus between the 16-inch diameter casing and 12-inch diameter carrier pipe In the event that the fiber optic leak detection cable fails after the Liberty Pipeline goes into service, alternative operational procedures and measures that maintain a similar level of safety must be developed and implemented. These alternative measures must similarly transmit data to the leak detection software or SCADA system. 36 Monitoring of the PIP annulus pressure provides a method of leak detection. In an event that the pressure increases, high pressure could indicate a leak in the 12.75-inch diameter carrier pipe, in the 16-inch diameter casing, or both. Additional information from the Liberty Pipeline Leak Detection System would help to determine the location of the leak on the Bundle and to determine ifthe leak is on the casing pipe or on the Liberty Pipeline. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 26 of 44 <<>> will be maintained below atmospheric pressure at negative 10 psig or less during nonnal operations, per Condition 11(e). ii) Hilcorp must investigate and respond to pressure changes based upon a delta of 5 psi over two (2) hours, or annulus must be in vacuum, or using O&M procedures that were developed based upon plotted operational knowns, which must receive a "no objection" letter from PHMSA's Western Region Director or Project Designee. If Hilcorp does not receive a "no objection" letter from PUMSA within 90 days of the notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. iii) Ifthe pressure excursion is greater than 5 psi and less than 10 psi, Hilcorp must flush the annulus with dry gas to achieve positive 10 psig. Hilcorp must perform a leak test to determine whether a leak exists on carrier or casing. iv) llilcorp must investigate and respond to temperature changes and initiate remediation based upon a delta of 20°F over 30 minutes, not to exceed a total delta of 5 0°F, or on O&M procedures that are based upon plotted operational knowns, which must receive a "no objection" letter from PHMSA' s Western Region Director or Project Designee. If Hilcorp does not receive a "no objection" letter from PHMSA within 90 days of the notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. v) Dew point sampling equipment connected to the 16-inch diameter casing and annulus vacuum system must be installed. In the event of a dew point change of 10 degrees or greater, Hilcorp must immediately take remedial action including investigating the cause of the change in dew point and flush the PIP annulus to return the dew point within operating limits in accordance with Condition 11. vi) Dew point samples must be taken prior to commissioning, during operations, and at each ILl assessment. c) Bundle Monitoring: Temperature monitoring data via a DTS fiber optic cable must transmit data to the SCADA system for real time monitoring and recording. Hilcorp must investigate and initiate remediation based upon a temperature changes outlined in Condition 29(b). PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 27 of 44 <<>> 29) Monitored Response Procedures: Monitoring and Response Procedures for the specialpermit segment must include response plans for the 12.75-inch diameter carrier pipe, the PIP annulus, and the bundle monitoring system. The procedures must include; established operating limits of the Liberty Pipeline, troubleshooting variances, methods for identification of the source ofthe variances, and procedures for returning the Liberty Pipeline to established operating limits. a) b) Carrier Pipe- Pressure and Temperature Monitoring: The following procedures must be included in the Monitoring and Response Procedures and followed in an event that the temperature of the 12.75-inch diameter carrier pipe is not within the operating limits: i) Immediate to 24 Hour response: 1. The temperature of the Liberty Pipeline specialpermit segment must not exceed 150 °F. 2. 3. Ifthe temperature exceeds the maximum operating/maximum design limit of 150 °F, the operating temperature must be reduced below the design limit within two (2) hours. If the operating temperature of the pipeline exceeds the operational limit for more than 24 hours, PHMSA's Western Region Director or the Project Designee must be notified. Bundle -Temperature Monitoring: A Monitoring and Response Program and Procedures must be implemented to identify the response for temperature anomalies in the soil surrounding the bundle. i) If the temperature reading is reduced at a point along the bundle, it could indicate an exposure to seawater and loss of soil cover. Hilcorp must assess potential reasons for the temperature loss and loss of cover such as, strudel scour, ice keels, upheaval buckling, and natural erosion. ii) An immediate temperature change could indicate a combined leak ofboth the 12.75- inch diameter carrier pipe and the 16-inch diameter casing. Alternatively, it could indicate seawater exposure to the casing. Hilcorp must immediately investigate and assess potential reasons for temperature fluctuation. iii) DTS temperature changes that initiate investigation, response, and remediation must be based upon a temperature change of 20°F or more in any 30-minute period, total PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 28 of 44 <<>> temperature changes of 5 0°F, or on O&M procedures that are based upon plotted operational knowns. O&M procedures for plotting operational temperature knowns must receive a "no objection" letter from PHMSA's Western Region Director or Project Designee. IfHilcorp does not receive a "no objection" letter from PHMSA within 90 days of the notification, Hilcorp may proceed. PHMSA will notify Uilcorp if additional review time is needed. 30) CP System Monitoring of the Casing Pipe: a) b) c) A CP monitoring system must be provided on the 16-inch casing to determine the performance of the galvanic-based corrosion control system. The CP monitoring system must, at a minimum, include test leads for the first 1,000 feet from each shoreline and at frequent enough intervals to demonstrate adequate CP ofthe casing pipe within that 1,000 feet. The CP monitoring system must also utilize periodic close interval surveys (CIS) over the entire length of the submerged pipeline casing at least once every five (5) years utilizing a silver/silver chloride reference electrode or other alternative (comparable) method. The CP monitoring system must be in place and a baseline CIS must be performed within one (1) year after construction of the specialpermit segment is completed. Each monitoring point must be a minimum often (10) feet from a galvanic anode. Each monitoring point must include two (2) casing connections, a silver-chloride reference electrode, and two (2) coupons made from the same grade steel as the casing. i) The casing leads must be independently welded to the casing and the weld areas coated. ii) The reference electrode and coupons must be strapped to the casing. iii) Three (3) to five (5) lead wires for each monitoring point must be buried along with the casing and terminated in a junction box on shore. Each wire will be labeled with the approximate distance from shore and what it is connected to: casing, casing coupon, coupon, reference electrode. For each set of monitoring leads, one coupon lead will be bonded to one casing lead through a 0.01 -ohm shunt so that the coupon receives CP like the casing but can be disconnected from the CP and provide instant- off and depolarized potentials. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 29 of 44 <<>> d) Potential readings must be taken between the coupon and the local reference electrode. Note: CP current density can be established by reading the voltage drop across the shunt. The second casing connection and second coupon are primarily used for trouble shooting the monitoring point in the event there are unusual readings. This arrangement represents the best available technology for monitoring the adequacy of the CP system and correcting for voltage drops from directly connected anodes and telluric currents. e) Potential readings must be taken for each coupon once every calendar year throughout the life of the pipeline. f) The CP system must be operational and meet the requirements of this permit within six (6) months ofplacing the subsea segment into service. g) Ifmore than 20% ofthe test leads fail, then the close interval survey frequency must be decreased to a 2-year interval. 31) SCADA and CPM Systems: SCADA and CPM leak detection systems must be developed and maintained to provide remote monitoring and control ofthe pipeline system in accordance with 49 CFR 195 .444 and 195.446. 32) Data Integration: Hilcorp must maintain data integration of all special permit condition findings and remediation in the specialpermit segment. Hilcorp must create a data integration plan to integrate and analyze data pertaining to the integrity of the specialpermit segment. The data integration plan must define the integrity management data elements required for integrity management of the specialpermit segment, including, but not limited to, strain capacity assessment, determination and forecast of strain demand, and monitoring and remediation. a) Data integration documentation and drawings must be completed to meet 49 CFR 195.452(g) and (h) and must include the data elements in Table 5- Data Integration Requirements. If requested, this documentation must be submitted to PHMSA beginning with the second annual report ofthis special permit. b) Data integration must be updated on an annual basis. Hilcorp must conduct, at least one annual review of the Liberty Pipeline integrity issues to be remediated. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 30 of 44 <<>> Table 5: Data Integration Requirements Category Data Data Element Diameter, wall thickness, grade, seam type, pipe/girth Design Pipe weld coatings, abrasive resistance coatings, design factors, and maximum operating pressure Construction Depth of cover Depth of cover surveys MOP, including normal, maximum, and minimum Normal, maximum and operating pressures minimum operating Operating temperatures based upon seasonal, through- pressures put, and normal, maximum, and minimum operating pressures O&M Leak/failure history Any in-service ruptures or leaks CP test point survey readings; CP system performance Other telluric current surveys, close interval surveys High consequence areas (HCAs) (including boundaries on aerial photography or satellite imagery) Normal maximum and MOP,including normal and minimum operating minimum operating pressures pressures PIP Annulus Review of minimum temperatures and effects on¯ Bundle Monitoring annulus. Note: Ifthe temperature reading is reduced at a point along the bundle, it could indicate an exposure to seawater. Casing Pipe Casing Pressure tests In-line inspections Inspection CP inspection Coating condition inspections (DC voltage gradient) Other Diameter, wall thickness, grade, seam type, and external coating, if coated. Hydrostatic test pressure, including any known hydrostatic test failures or leaks ILl tool results including high resolution (HIR) metal loss tools; HR-deformation tools; stress corrosion cracking; and mapping ILl tool results Monitoring electrode and CP coupon surveys, test stations, and periodic close interval surveys Pipe coating surveys, pipe coating and anomaly evaluations from pipe excavations Pipe exposures for any reason PHMSA-2017-0091, llilcorp- Liberty Pipeline- Special Permit Page 31 of 44 <<>> 33) Environmental Assessments and Permits: Hilcorp must evaluate the potential environmental consequences and affected resources of any land disturbances and water body crossings needed to implement the special permit conditions for the specialpermit segment prior to the disturbance. If a land disturbance or water body crossing is required, Hilcorp must obtain and adhere to all applicable (federal, state, and local) environmental permit requirements when conducting special permit conditions activity. Reportin2, Documentation, and Certification: 34) Notices to PIIMSA: In addition to the notifications required in the conditions above, Hilcorp must also provide the following notifications: a) Hilcorp must notify the PHMSA Western Region Director or Project Designee 14 days prior to construction or operational activities relating to Conditions 5 (pipe manufacturing), 14 (pipe coating), 17 (construction) and 24 (integrity assessments) so PHMSA can observe the activity. The PUMSA Western Region Director or Project Designee may elect to not require a notification for some activities. b) Hilcorp must notify PHMSA of immediate repair conditions no later than two (2) business days after a condition is discovered. 35) Annual Report: Within twelve (12) months following issuance ofthe Liberty Pipeline special permit, and annually37 thereafter, Hilcorp must develop and submit annual reports that include the below information. The reports must be sent to the PHMSA Western Region Director or Project Designee, and Hilcorp must provide copies to the PHMSA Engineering and Research Division Director, the PHMSA Standards and Rulemaking Division Director and to the Federal Register Docket (PHMSA-2017-0091) at www.regulations.gcy prior to placing the pipeline in service.38 The annual reports must include the following information: a) Any integrity threats identified, such as through ILl or data integration, during the previous year in the specialpermit segment, including Level 2 or Level 3 strains (see Table 4: Pipeline Segment Strain Demand Monitoring); Annual reports must be received by PI{MSA by the last day ofthe month in which the special permit is dated. For example, for a special permit dated March 4, 2018, the annual report must be received by P}{MSA no later than March 3Pt each year beginning in 2019. 38 Upon notice to Hilcorp, PHIMSA may update the reporting contacts for Condition 35- Reporting. PHMSA-2017-0091, Hilcorp-Liberty Pipeline- Special Permit Page 32 of 44 <<>> b) Results of any ILl or direct assessments performed during the previous year in the special permit segment; c) Any reportable incident or leak reported on the DOT Annual Report in the specialpermit segment; d) e) All repairs that occurred during the previous year in the specialpermit segment, Any ongoing damage prevention, corrosion, and longitudinal strain preventative initiatives affecting the specialpermit segment, as well as an evaluation ofthe performance of the initiatives; f) Summary of all irregular annulus pressure changes, temperature changes, or dew point changes that required regional notification; g) Any instance where the specialpermit segment exceeds any of the operating parameters in Tables 1 and 2 and Table 4- Strain Levels 2 or 3; h) Any mergers, acquisitions, transfers of assets, or other events affecting the regulatory responsibility ofthe pipeline operating company; and i) An overview of the Liberty Pipeline design and construction activities and schedules prior to the pipeline being placed into operational service. This summary is not required after the specialpermit segment is placed into operational service. 36) Documentation: Hilcorp must maintain the following records for the Liberty Pipeline special permit segment. Hilcorp must maintain all documentation for the life of the special permit and provide such documentation to PHMSA upon request: a) Documentation showing that Hilcorp complied with 49 CFR 195.304, 195.305, and 195.306, Subpart B, except the hydrostatic test must be for eight (8) continuous hours and at a minimum pressure of 1.25 times MOP. Hilcorp must retain all pressure test records in accordance with 49 CFR 195.3 10. i) If Hilcorp does not have hydrostatic test documentation, then the specialpermit segment must be hydrostatically tested to meet this requirement within one (1) year of receipt of this special permit and documentation must be maintained. b) Documentation of mechanical and chemical properties (mill test reports) showing that all pipe in the specialpermit segment meets the wall thickness, yield strength, tensile strength and chemical composition of American Petroleum Institute Standard 5L, "Specification for PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 33 of 44 <<>> Line Pip&' (API 5L).39 Pipe in the specialpermit segment that does not have mill test reports cannot be authorized per this special permit. c) Documentation of compliance with all conditions of this special permit. 37) Certification: Prior to placing the pipeline in service, a senior executive officer, vice president or higher, of Hilcorp must certify the following in writing: a) The Liberty Pipeline meets the conditions described in this special permit or has procedures meeting these conditions for O&M activities that are completed after placing the Liberty Pipeline into operational service; b) The written manual of O&M procedures for the Liberty Pipeline has been updated to include all additional operating and maintenance requirements ofthis special permit; c) A compliance documentation summary showing Hilcorp implemented all conditions as required by this special permit; and. d) Hilcorp has reviewed the project compliance documentation summary of all special permit conditions with the PHMSA OPS Associate Administrator and designees within 30 days of placing the Liberty Pipeline into service. e) Hilcorp must send the signed and dated written certifications with corresponding completion dates to the Associate Administrator for Pipeline Safety, with copies to the Deputy Associate Administrator for Field Operations; Director, OPS Western Region; Director, OPS Standards and Rulemaking Division; and Director, OPS Engineering and Research Division, as well as to the Federal Register Docket (PHMSA-20 17-0091) at https://www.regulations.gyL. All certifications must be completed prior to placing the Liberty Pipeline into crude oil service. III. Limitations: This special permit is subject to the limitations set forth in 49 CFR 190.341 as well as the following limitations: 1) PHMSA has the sole authority to make all determinations on whether Hilcorp has complied with the specified conditions ofthis special permit. Hilcorp must use the API 5L edition incorporated by reference in 49 CFR 195.3. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 34 of 44 <<>> 2) Any work plans and associated schedules for the Liberty Pipeline are automatically incorporated into this special permit and are enforceable in the same manner. 3) Failure by Hilcorp to submit the certifications required by Condition 37 (Certifications) within the time frames specified may result in revocation of this special permit. 4) As provided in 49 CFR 190.341, PHMSA may issue an enforcement action for failure to comply with this special permit. The terms and conditions of any corrective action order, compliance order or other order applicable to a pipeline facility covered by this special permit will take precedence over the terms of this special permit. 5) If Hilcorp sells, merges, transfers, or otherwise disposes of all or part ofthe assets known as the Liberty Pipeline, Hilcorp must provide PHMSA with written notice ofthe change within 30 days ofthe consummation date. In the event of such transfer, PHMSA reserves the right to revoke, suspend, or modify the special permit ifthe transfer constitutes a material change in conditions or circumstances underlying the permit. 6) PHMSA grants this special permit to limit it to a term of no more than ten (10) years from the date of issuance. If Hilcorp elects to seek renewal of this special permit, Hilcorp must submit its renewal request at least 180 days prior to expiration of the ten (10) year period to the PHMSA Associate Administrator for Pipeline Safety with copies to the Deputy Associate Administrator, PHMSA Field Operations; Deputy Associate Administrator, PHMSA Policy and Programs; PHMSA Western Region Director; Director, PHMSA Standards and Rulemaking Division; and Director, PHMSA Engineering and Research Division. All requests for a renewal must include a summary report in accordance with the requirements in Condition 35 (Annual Report) above and must demonstrate that the special permit is still consistent with pipeline safety. PHMSA may seek additional information from Hilcorp prior to granting any request for special permit renewal. AUTHORITY: 49 U.S.C. 60118 and 49 CFR 1.97. APR29 2019 Issued in Washington, DC on an K. Mayberry, Associate Administrator for Pipeline Safety PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 35 of 44 <<>> Figure 1- Pipeline Bundle Cross Section . Sales quality crude oil will be exported from the island through a subsea nominal pipe size (NPS) 12 x 16 PIP system that is bundled to a nominal 4-inch coiled utility line, along with an armored fiber optic cable. 16" DIA x 0.625" WI CASING 12.75" DIA x 0.500" WI LSOP CASING ISOLATOR RADIA11ON BARRIER 16 MILS FBE COAliNG 1Th ARO BUNDLE SPACER BUNDLE STRAP ARMORED FIBER 0P11C CABLE DIA x 0.300" WI U11LITY UNE MILS 3LPE Figure 2- Bulkhead Schematic for 12.75-inch Diameter Carrier and 16-inch Diameter Casing Tie-in F3LLKHEAD . PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 36 of 44 <<>> Figure 3- Offshore Subsea Buried Pipeline Segment \Island End (control point) \ Let: 70° 16 28.5Il"N Ion: 147° 35' 10.772' W NAD1983 / Foggy / srd H NAD 1983 i y -ft. -. 'I- Tie-tn at Badarni PIL Let: 70° II' l,116"N Lon: 147° 43 25.437W NAD 1983 Legend - LjO.,IyPIp.E.RoooOffIno,e Badumi p EAST KAD 1,01 0fF SIfl,.,0M.St.t&F*,&BoOd.,yl flpfa8100 Slal001ane Zone MAO 198 (Feel) 0 Proposed Liberty Pipeline Route oIometors 04,0 nab- vznseii S I 2 ,M)tos PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 37 of 44 <<>> Figure 4- Liberty Pipeline Location (Liberty Prospect) Point Mcintyre Northstar / (BP) (HAK), / / West Beach Mime Point. I / / (BP) Niakuk (HAK) .1 / / (Bp: I Lisburne / (BP) / Endtcott , \ .\ 'y,/HAK Liberty Prospect / (HAK) Greater Prudhoe Bay (BP) tt Deadhorse' Trans Alaska Pipeline System (TAPS) Ii - Badami Pip me Badarni (Savant) PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 38 of 44 <<>> Appendix A- Engineering Critical Assessment for Cracks 1) Engineering Critical Assessment for Cracks An engineering critical assessment (ECA) is conducted for any crack found that is over 10% wall depth on the 12.75-inch diameter Liberty Pipeline specialpermit segment. Hilcorp must perform such ECAs in accordance with this Appendix A and Condition 26. The ECA must be performed to determine the predicted failure pressure ofthe as-discovered condition and the remaining life for the pipeline at the defect location. The ECA must use applicable fracture mechanics modeling techniques, pressure cycle analysis, crack growth fatigue models, and failure mode analysis (brittle, ductile, or both) for the microstructure (i.e., heat-affected zone, bond line, parent pipe, etc.). 2) Predicted Failure Pressure Calculation The predicted failure pressure must be calculated using technically proven fracture mechanics evaluation methods (see Section 7 of Appendix A) that are known to be technically appropriate for whether the crack defect is in ductile, brittle, or both material types. 3) Crack Growth Analysis The crack growth analysis must determine the remaining life of the largest remaining critical crack flaw, based on the operating parameters of the pipeline; any pipe failure or leak mechanisms identified during any pressure testing or other operations; pipe characteristics; material mechanical properties (including toughness); failure mechanism for the microstructure (ductile and brittle or both); location and type of defect; operating environment; operation conditions, including pipe operating temperatures; and pressure cycling induced fatigue. The analysis must use technically proven methods and procedures for analyzing crack growth (both length and depth), crack interactions, and crack coalescence within the cluster of cracks in the identified defect. 4) Fatigue Analysis Fatigue analysis must be performed using a recognized form of the Paris Law or other technically appropriate engineering methodology to give conservative predictions of flaw growth and remaining life. "Other technically appropriate engineering methodology" procedures must be submitted by Hilcorp to the PHMSA Western Region Director or Project Designee for a "no objection" letter prior to Hilcorp's implementation of the procedures. IfHilcorp does not receive a PHMSA-2017-0091, Hilcorp- Liberty. Pipeline- Special Permit Page 39 of 44 <<>> "no objection" letter from PHMSA within 90 days of the notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. 5) Crack Degradation & Analysis When assessing other degradation processes (other than pressure cycling), an operator must perform the analysis using recognized rate equations where the applicability and validity are demonstrated for the case being evaluated. The analysis must include conservative estimates of time to failure for any known or potential remaining cracks in the pipe. The analysis to determine the time to failure for a crack must include operating history, pressure cycles, pressure tests, pipe geometry, wall thickness, strength level, flow stress, Charpy V-Notch energy values for the operating temperature, other applicable operating conditions, and the operating environment for the pipe segment being assessed, including the role of the pressure- cycle spectrum and any significant changes in the actual versus predicted pressure-cycle spectrum. 6) Crack Analysis Data Data used in the calculations must use all of the following, as appropriate: a) Mechanical Properties Mechanical properties of the pipe must be used in the analysis. The analysis must account for metallurgical properties at the location being analyzed. If properties of the pipe are unknown, Hilcorp must submit to PHMSA procedures of how pipe mechanical properties will be determined and Hilcorp must receive a "no objection" letter from PHMSA's Western Region Director prior to implementation ofthe procedures. IfHilcorp does not receive a "no objection" letter from PHMSA within 90 days ofthe notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. Material strength and toughness values used in the analysis must reflect the local conditions at the defect location or segment being analyzed (such as in the properties of the parent pipe, weld heat-affected zone, or weld metal bond line) and use data that is applicable to the specific line pipe vintage and segment. When the strength and toughness and limits or ranges are unknown, the analysis must assume material strength and fracture toughness levels corresponding to the pipe vintage and type. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 40 of 44 <<>> For pipe body or weld crack assessments, use the actual ranges of values of strength and toughness that are known from tests of similar material; conduct destructive material tests of the pipe; determine material properties based upon other appropriate nondestructive examination technology; or use conservative values based on technical research publications that an operator demonstrates provides conservative Charpy V-Notch energy values ofthe crack-related conditions and conservative strength values of the line pipe appropriate for the seam type. Testing programs to determine pipe and seam material properties must conduct enough material testing to establish statistically valid mean andstandard deviations from their results, and material property values used in ECAs, with a minimum of at least five (5) tests for each type of pipe. b) Crack Dimensions Crack length and depth dimensions must be obtained from in situ direct measurements on the pipe, from crack detection ILl tools for cracking, or from the largest calculated remaining crack from a hydrostatic pressure test. IL! Tool Crack Detection For cases that analyze remaining flaw sizes measured using crack detection ILl tool data, the analysis must use flaw dimensions and characteristics that conservatively account for ILl tool inaccuracies and measurement tolerances, and the operator must confirm inaccuracies and measurement tolerances through direct in situ non-destructive examination using technology that has been validated to detect and measure tight cracks. In-the-ditch examination tools and procedures for crack assessments (length, depth, and volumetric) must have performance, tool accuracy, tool tolerance, and evaluation standards, including pipe or weld surface cleanliness standards for the inspection, confirmed by subject matter experts qualified by knowledge, training, and experience in direct examination inspection and in metallurgy and fracture mechanics for accuracy for the type of defects and pipe material being evaluated. Largest Calculated Crack from Hydrostatic Pressure Test For cases where Hilcorp evaluates remaining life for pipe segments that have successfully passed a hydrostatic test, Hilcorp must conservatively determine the largest flaw size(s), i.e., crack length and depth, that could have survived the hydrostatic pressure test. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 41 of 44 <<>> 7) Failure Mode Analysis The ECA must account for the likely failure mode of anomalies (such as brittle fracture, ductile fracture, or both). If the likely failure mode is uncertain or unknown, the analysis must analyze both failure modes and use the more conservative result. a) Fracture Mechanics Modeling Fracture mechanics modeling that is technically appropriate for the anomaly type must be used to determine failure stress pressures. b) Brittle Failure Mode Analysis Brittle failure mode analysis must use linear-elastic failure models such as the RajulNewman stress-intensity solutions or other technically proven approaches. c) Ductile Failure Mode Analysis Ductile failure mode analysis must use technically appropriate failure models such as the Modified LnSec, CorLas, Pipe Axial Flaw Failure Criteria, API 579 Level-Il, PipeAssess pJTM, or other technically proven approaches. d) Other Failure Mode Analysis Other technically proven-equivalent engineering fracture mechanics models may be used, which can be shown to accurately predict the response for the feature of concern or the worst- case scenario, for determining conservative failure pressures for the specific failure mode 8) ECA Reassessment Intervals When establishing reassessment intervals for pipelines with known or suspected remaining cracks or crack-like defects, the maximum reassessment interval may not exceed one-half of the remaining life determined by an ECA. However, PHMSA will consider as "other technology," the use of a reassessment interval that is greater than one-half of the remaining life determined by the ECA, or if impractical due to tool availability, iftechnically documented and justified. If changes to operating conditions exceed the assumptions included in the remaining life analysis, then the remaining life must be reanalyzed and recalculated within six (6) months of the change. 9) ECA Documentation Requirements The following documentation must be retained from the ECA: a) The technical approach used for the analysis, including procedures, evaluation methodology, and models used; PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 42 of 44 <<>> b) c) d) e) 1) g) h) i) j) k) 1) m) n) All data used and analyzed; Pipe and weld properties including Charpy Impact values; Direct in situ examination data, including in-the-ditch assessments; ILl tool run information evaluated, including any multiple ILl tool runs; Pressure test data and results, if applicable; All measurement tool, assessment, and evaluation accuracy specifications and tolerances used in technical and operational results; All finite element analysis results, where applicable; The number of pressure cycles to failure, the equivalent number of annual pressure cycles, and the pressure cycle counting method, such that fatigue life models and fracture mechanics evaluation methods are documented; Safety factors used for fatigue life and/or predicted failure pressure calculations; Reassessment time interval and safety factors; The date of the review; Documentation confirming the results; and Approval by responsible operator management personnel. 10) ECA Assessment Technology Other technology for ECAs may be used ifthe operator demonstrates that the assessment provides an equivalent understanding ofthe condition of the line pipe. Such "other technology" methodologies may include different or improved crack assessment methodologies, fracture mechanics evaluation methods, crack growth evaluation methods, fatigue models, and remaining life models, as well as differing or less-conservative assumptions for pipe and seam properties, or any other aspect ofthe operator's ECA methodology that does not comply with the requirements of this section. If the "other technology" option is selected, the PHMSA OPS Western Region Director or Project Designee must be notified by Hilcorp ninety (90) days before implementing the ECA and Hilcorp must receive a "no objection" letter from PHMSA prior to implementing the "other technology". If Hilcorp does not receive a "no objection" letter from PHMSA within 90 days of the notification, Hilcorp may proceed. PHMSA will notify Hilcorp if additional review time is needed. PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 43 of 44 <<>> 11) ECA Procedure Review by PHMSA Hilcorp must submit the ECA procedure to PHMSA Western Region Director or Project Designee and Hilcorp must receive a "no objection" letter from PHMSA prior to implementing Appendix A. If Hilcorp does not receive a "no objection" letter from PHMSA within 90 days of the notification, Hilcorp may proceed. PHMSA will notif Hilcorp if additional review time is needed. THE END OF SPECIAL PERMIT PHMSA-2017-0091, Hilcorp- Liberty Pipeline- Special Permit Page 44 of 44 <<>> U.S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION Special Permit Analysis and Findings Special Permit Information: Docket Number: PHMSA-2017-0091 Requested By: Hilcorp Alaska, LLC Operator ID#: 32645 Original Date Requested: March 24, 2017 Issuance Date: April 29, 2019 Effective Dates: April 29, 2019 to April 29, 2029 Code Section(s): 49 CFR 195.563 and 195.573 Purpose: The Pipeline and Hazardous Materials Safety Administration (PHMSA) provides this information to describe the facts of the subject special permit application submitted by Hilcorp Alaska, LLC (Hilcorp),1 owner and operator of the proposed Liberty Sales Oil Pipeline (Liberty Pipeline), to discuss any relevant public comments received with respect to the application, to present the engineering/safety analysis of the special permit application, and to make findings regarding whether the requested special permit should be granted and if so under what conditions. Hilcorp requested that PHMSA waive compliance from 49 Code of Federal Regulations (CFR) 195.563 and 195.573 for approximately 5.68 miles of 12.75-inch hazardous liquid pipeline installed within a 16-inch diameter casing pipe. Pipeline System Affected: The special permit request applies to the Liberty Pipeline and asks for a waiver of the cathodic protection (CP) requirements in 49 CFR 195.563 and 195.573 for approximately 5.68 miles of 12.75-inch diameter pipeline. The Liberty Pipeline will transport crude oil. The Liberty Pipeline 1 Hilcorp Alaska, LLC is a wholly-owned, operating subsidiary of Hilcorp. The Liberty Project partners include Hilcorp Alaska, LLC, BP Exploration (Alaska) Inc., and ASRC Exploration, LLC. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 1 of 26 <<>> starts at the Liberty Drilling and Production Island (LPDI), an artificial island, and travels across Foggy Island Bay of the Beaufort Sea, United States Outer Continental Shelf (OCS), to the northern Alaskan coast line located west of the Kadleroshilik River Delta. The Liberty Pipeline route and location can be reviewed in the special permit conditions. The Liberty Pipeline special permit segment includes the approximately 5.68 miles of 12.75- inch diameter carrier pipeline installed within a 16-inch diameter casing pipeline, the 16-inch diameter casing pipeline, the annular space between the two (2) pipelines, the two (2) casing to carrier pipe “bulkhead” connections located on each end of the pipe-in-pipe (PIP) segment, and the connecting 12.75-inch diameter carrier pipeline from the 16-inch casing pipe to the in-line inspection (ILI) tool launcher and receiver from approximate Milepost (MP) 0.02 and MP 7.25. 2 The special permit conditions require installation and operation of an in-line inspection ILI tool calibration spool, remote operated mainline valves located at Milepost (MP) 0.02 and MP 7.25, and ILI launchers and receivers. At the shore, the pipeline will transition to a single- wall, aboveground pipeline supported on vertical support members (VSMs) and continue south to tie into the existing Badami Pipeline. Product (crude oil) will be transported from the Liberty Pipeline through the Badami and Endicott Pipelines to the Trans Alaska Pipeline System (TAPS). Special Permit Request: Hilcorp applied to PHMSA on March 24, 2017, for a special permit seeking relief from the Federal Pipeline Safety Regulations in 49 CFR 195.563 and 195.573 for the Liberty Pipeline. Hilcorp’s request for a special permit is for the Liberty Pipeline, specifically, the submerged PIP segments, and proposes waiving compliance from the following corrosion control sections of the Federal Pipeline Safety Regulations: 1) 49 CFR 195.563, Which pipelines must have cathodic protection? 2) 49 CFR 195.573, What must I do to monitor external corrosion control? 2 The “Liberty Pipeline” refers to the entire approximately 7.25 miles of pipeline and supporting facilities that are jurisdictional to 49 CFR Part 195. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 2 of 26 <<>> These Federal Pipeline Safety Regulations require hazardous liquid pipeline operators to have CP to prevent external corrosion and to monitor the level of external corrosion control to ensure adequate protection from pipeline metal loss. While the PIP3 design is intended to prevent the creation of a corrosive environment, if there is a failure of either one of the pipes, a corrosive environment will occur and compliance with these federal corrosion regulations would not be possible. Furthermore, the PIP design and operating temperature differentials introduce atypical loads and strains to the pipeline, and presents pipeline condition assessment challenges that must be addressed to stay in full compliance. The purpose of the Liberty Pipeline special permit is to assure safety and environmental protection in lieu of compliance with these Federal Pipeline Safety Regulations. The special permit conditions are necessary to ensure the design, construction, operation and maintenance (O&M) activities of the Liberty Pipeline are consistent with pipeline safety, specifically 49 CFR Part 195. The Liberty Pipeline will consist of 12.75-inch diameter pipeline surrounded by an outer 16-inch diameter casing pipe. This PIP design creates a dry annulus that protects the carrier 12.75-inch diameter pipeline from exposure to electrolytes, such as sea water, saturated thermal insulation, or saturated soils. The special permit conditions apply to the design, construction, and O&M of this PIP system. Specifically, the special permit conditions address the possible introduction of an electrolyte around the carrier pipe, which could create an environment allowing corrosion to occur. Further, the special permit conditions provide a means for assessing the condition of the carrier pipe to ensure its integrity is maintained if the PIP system is compromised. Finally, the special permit conditions are necessary to allow Hilcorp to safely operate the special permit segment at a maximum operating pressure (MOP) of 1,480 pounds per square inch gauge (psig) and a maximum operating temperature of 150 degrees Fahrenheit (°F). 3 The PIP reference means the 12.75-inch diameter carrier pipe installed within the annulus of the 16-inch diameter casing pipe in the special permit segment. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 3 of 26 <<>> The special permit allows Hilcorp to operate the Liberty Pipeline special permit segment without CP, but Hilcorp must operate the special permit segment in accordance with the additional safety requirements required in the special permit conditions. Public Notice: On October 15, 2018, PHMSA published the special permit request in the Federal Register (83 FR 52050) and the public comment period ended on November 14, 2018, with all comments received being reviewed and considered. The special permit application from Hilcorp, pipeline route maps, public comments, environmental assessment, and special permit conditions are available in Docket No. PHMSA-2017-0091 at: www.regulations.gov. PHMSA received comments from four (4) stakeholders on the proposed Liberty Pipeline special permit. The comments received were for denial of the special permit request. A summary of stakeholder posted comments are:  Stakeholder Comments Requesting PHMSA to Deny the Special Permit: 4 o Private Citizens – 2 o The Wilderness Society (TWS) – 1 o Center for Biological Diversity - 1  Stakeholder Comments in support of Special Permit: 0 PHMSA Overall Response and Considerations of Public Safety Concerns: PHMSA has reviewed the public stakeholder comments on the docket, e-mails sent to PHMSA, and phone calls received through November 14, 2018, concerning the Liberty Pipeline. For the special permit segment, usage of the enhanced design, material, construction, operations and maintenance specifications, and procedures as outlined in the special permit conditions will maintain equivalent safety as compared to maintaining CP and installing no casing pipe through this special permit segment. The public comments are summarized as noted below and in the referenced Final Environmental Assessment and Finding of No Significant Impact and the special permit conditions that must be implemented can be reviewed on the docket (PHMSA-2017-0091) at www.regulations.gov. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 4 of 26 <<>> PHMSA’s summarization of the public stakeholder comments and how the concerns are being handled within the special permit are below: 1) Stakeholder Comment: CP requirements prevent both internal as well as external corrosion. Note that Hilcorp’s application only focuses on external corrosion. TWS believes that the CP system is needed to prevent internal corrosion on this pipeline which will be carrying warm – up to 150 °F – crude oil. While it is true that the outer pipeline may prevent oil from entering the offshore environment if there is a release from the inner pipeline, there still will be adverse construction and remediation-related impacts resulting from that release.  PHMSA Response: Buried pipelines utilize CP, either using an impressed current or a galvanic anode system, to protect the pipeline against external corrosion. Internal corrosion most commonly occurs due to corrosive mixtures of water and certain gases like carbon dioxide (CO2) or hydrogen sulfide (H2S) in the transported fluid. Microbial influenced or induced corrosion can also result in accelerated deterioration of the pipe initiated by different microbial activities present in oil and gas systems. PHMSA’s regulations, specifically 49 CFR 195.579, require operators to investigate and determine whether the fluid stream in the carrier pipe is corrosive, and take adequate steps to mitigate internal corrosion including the introduction of corrosion inhibitors, eliminating the corrosive fluid stream, and to monitor the effectiveness of the inhibitors via coupons (pieces of steel pipe that are inserted into the pipeline and routinely measured for metal loss). The ILI devices mandated in the special permit conditions for the Liberty Pipeline will allow for the routine identification and measurement of any internal corrosion to confirm the internal corrosion methods being used by Hilcorp are effective. While there should not be a corrosive environment in the Liberty Pipeline PIP annulus since Hilcorp is being mandated to keep it continuously dry, if water or other corrosive fluids were to enter the annulus, the casing could experience internal corrosion. For that reason, we are revising the proposed special permit conditions to require Hilcorp to coat the inside of the casing pipe with a corrosion resistant material. The 12.75-inch diameter carrier pipe is already required to have an external coating. These steps PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 5 of 26 <<>> should minimize any release either from the carrier pipe or the secondary containment provided by the casing pipe. (See Special Permit Condition 10(d) for requirements for coating the internal and external surfaces of the 16-inch diameter casing pipe.) 2) Stakeholder Comment: In order to create an inert environment between the two pipes, Hilcorp proposes to seal the ends of the inner and outer pipelines. Because this approach will create additional pipeline stresses and is contrary to the design used in two similar Alaska projects, Oooguruk and Nikaitchuk pipelines, TWS questions why Hilcorp has chosen to use this problematic design. Also, as noted in the Draft Environmental Assessment (EA) developed for this special permit: o “the [PIP] design would require more time to complete a repair than a single walled pipe. This longer repair duration for the proposed action as compared to the no-action could result in slightly greater impacts to the wildlife, in the event that a repair is needed. This difference would increase the duration of noise, sedimentation in the water column, and direct disturbance to organisms living on the sea floor such as polychaetes, bryozoans, crustaceans and mollusks and sea life higher in the food chain that depend on those organisms.”  PHMSA Response: The Liberty pipeline design appears to be using a similar design as the Oooguruk and Nikatichuq pipelines. PHMSA does not regulate the crude oil carrier pipe or casing for either of these pipeline systems. PHMSA recognizes that a PIP design has certain merits, particularly if the carrier pipe fails and the casing can contain the oil so it does not enter the sensitive Beaufort Sea. Additionally, the carrier pipe and casing pipe are expected to expand at different rates causing potentially large loads on the pipes and PIP seals (bulkheads) at the ends of the PIP section. The special permit conditions require monitoring of any excessive deformation that could threaten the integrity of the carrier pipe or casing pipe. We concur that if a repair was needed that it may take longer to construct a safe working environment and minimize environmental damage. For that reason, in response to public comment, PHMSA has modified the proposed special permit conditions to require identification of integrity threats at lower PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 6 of 26 <<>> corrosion and deformation levels in order to schedule the repairs and prevent a potential failure. (See Special Permit Condition 24(h) for anomaly repair safety factors that will require repairs a schedules that will be faster than the schedules in 49 CFR Part 195). 3) Stakeholder Comment: The draft EA developed for this special permit has several deficiencies that must be addressed in the Final EA.  First and most importantly, the No Action alternative utilized for comparison is not appropriate as it assumes a single-wall pipeline in compliance with PHMSA’s CP regulations and not a PIP design in compliance with the regulations. As a result, the Draft EA must be redone comparing the special permit to a PIP design with CP, and that redone Draft EA should be made available for public comment.  Notably, the two most recent offshore Arctic pipelines constructed were both PIP configurations as those designs represent best practices.  PHMSA Response: PHMSA does not regulate the two cited PIP crude oil lines (Ooguruk and Nikaitchuq) in the Beaufort Sea. The Liberty Pipeline offshore design approach will be the fourth subsea pipeline installed in the Alaskan Beaufort Sea (Northstar, Oooguruk, and Nikaitchuq). The Liberty Pipeline will be the 3rd pipeline in the Beaufort Sea that utilizes a PIP design for the crude oil carrier pipe, however the other two (Oooguruk and Nikaitchuq) are not regulated since they are carrying non processed crude oil and were deemed to be a production flowline outside of PHMSA’s jurisdiction. Northstar is regulated by PHMSA since the crude oil is processed prior to transportation and uses a conventional single wall pipe design compliant with existing Federal Pipeline Safety Regulations. PHMSA regulates the safety of crude oil pipelines through 49 CFR Part 195. PHMSA did not consider a PIP alternative to have adequate CP since CP cannot be provided nor monitored for the sealed inner carrier pipe. PHMSA special permit conditions will mandate more extensive protection through monitoring and maintenance of the annulus and more frequent assessments than the existing Federal Pipeline Safety Regulations to ensure that corrosion is not occurring. PHMSA does want to encourage PIP design in limited PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 7 of 26 <<>> instances, e.g. where the environment is very sensitive, but PHMSA wants to ensure that no unintended safety consequences are introduced and that the pipeline stays in compliance with existing safety regulations. (See Special Permit Condition 24(b) through (d) for ILI integrity assessment criteria, which requires short assessment intervals than 49 CFR 195.452.) 4) Stakeholder Comment: The draft EA fails to specify the threatened and endangered species present in the area, though it does reference the Bureau of Ocean Energy Management’s (BOEM) full Environmental Impact Statement. Notably, there are many such species present in that area including several species of birds: spectacled eiders and Steller’s eiders (pages 3-36); and of marine mammals: bowhead, fin, humpback, and right whales; bearded seals, Steller sea lions, sea otters, and polar bears (pages 3-49). Specifying these species allows for improved public comments and awareness of the potential impacts of the project, and should be included in the Final EA.  PHMSA Response: The commenter is correct that various protected species utilize and inhabit the area of the Liberty Pipeline. The lead agency BOEM has authority to approve siting and construction of the proposed Liberty Development Project, including the proposed Liberty Pipeline. PHMSA has no authority over pipeline siting, and the “no action” alternative that PHMSA is required to consider is a pipeline that fully complies with the minimum standards in 49 CFR Part 195. BOEM initiated formal consultation under the Endangered Species Act with the National Marine Fisheries Service (NMFS) (NMFS Consultation Number: AKR- 2018-9747). In July 2018, NMFS issued a Biological Opinion for the Project, which includes an Incidental Take Statement along with Reasonable and Prudent Measures, Terms and Conditions, and Conservation Recommendations. That document is available on the NMFS website: https://alaskafisheries.noaa.gov/sites/default/files/biological-opinion-liberty- beaufort073118.pdf. BOEM announced the availability of the Record of Decision for the Final Environmental Impact Statement (FEIS) for the Liberty Development and PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 8 of 26 <<>> Production Plan (DPP) in the Beaufort Sea Planning Area in the Federal Register (83 FR 54136) on October 26, 2018, at https://www.federalregister.gov/documents/2018/10/26/2018- 23366/environmental-impact-statement-on-the-liberty-development-and- production-plan-in-the-beaufort-sea. The Record of Decision identifies the BOEM's selected alternative for the Liberty DPP. The Record of Decision and associated information are available on BOEM's website at https://www.boem.gov/liberty. 5) Stakeholder Comment: PHMSA’s draft EA defines the purpose and need of the proposed action as to require the issuance of a special permit to allow Hilcorp to construct the subsea [PIP] system without applying [CP] to the inner sales oil pipeline as required by 49 CFR 195.563 and 195.573. This purpose and need is entirely inadequate because PHMSA necessarily considered an unreasonably narrow range of reasonable alternatives. PHMSA has a duty to protect the public and the environment from the dangers of transporting oil by pipeline. Specifically, the Pipeline Safety, Regulatory Certainty and Job Creation Act (PSA), 49 United States Code (U.S.C.) 60101, et seq., seeks to “provide adequate protection against risks to life and property posed by pipeline transportation and pipeline facilities by improving the regulatory and enforcement authority of [PHMSA] Id. § 60102. Accordingly, PHMSA should have focused its purpose and need inquiry on objectives that comport with these statutory duties, rather than on appeasing the desires of the applicant.  PHMSA Response: Special permits are allowed through 49 U.S.C. 60118(c) – Compliance and Waivers - which gives PHMSA the authority to grant a special permit if PHMSA determines that the waiver is not inconsistent with pipeline safety. A special permit is an order by which PHMSA may grant to waive one or more of the Federal Pipeline Safety Regulations and is codified in 49 CFR 190.341. Hilcorp filed for a special permit in accordance with 49 CFR 190.341 and has provided the relevant documents for this special permit request. The Liberty Pipeline special permit request is to waive the CP criteria in 49 CFR 195.563 and 195.573, which requires CP of a pipeline and the monitoring of PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 9 of 26 <<>> pipeline external corrosion control. In its special permit request, Hilcorp Liberty proposed to construct a PIP design by installing the 12.75-inch carrier pipeline within a 16-inch casing pipe. The environmental assessment included two alternatives that compared the design, operations and maintenance of a PIP design (Alternative 2: Proposed Action) to a single wall pipeline without a casing (Alternative 1: No Action Alternative). The 16-inch casing pipe will have CP. The 12.75-inch carrier pipe for the crude oil will not have CP due to it being installed inside a casing pipe, which will shield it from the CP current. The special permit conditions address the possible introduction of an electrolyte, such as water or oxygen, around the carrier pipe or a metallic short in the carrier pipe, which would create an environment that allows corrosion to occur. Further, implementation of the special permit conditions by Hilcorp will provide alternative safety measures to assess, mitigate, and monitor the operations and on- going condition of the carrier and casing pipe to ensure integrity and safety is maintained throughout the operational life of the Liberty Pipeline. 6) Stakeholder Comment: NEPA evaluation must take place before decisions are made and before actions are taken. Such an approach ensures that agencies will take the requisite “hard look” at environmental consequences before approving any major federal action. But PHMSA’s purpose and need statement indicates that it did just the opposite. In other words, the purpose and need statement demonstrates that PHMSA already made the decision to grant the special permit and that its entire analysis was framed in a way to support that pre-determined outcome.  PHMSA Response: The lead agency, Bureau of Ocean Energy Management (BOEM), has authority to approve siting and construction of the proposed Liberty Development Project. PHMSA received a special permit request for waiver from 49 CFR 195.563 and 195.573, which requires CP of a pipeline and the monitoring of pipeline external corrosion control. In its special permit request, Hilcorp Liberty proposed to construct a PIP design by installing the 12.75-inch carrier pipeline within a 16-inch casing pipe. For this design it is not possible to provide CP to the carrier/inner pipeline. The casing pipe would be cathodically protected in conformance with 49 CFR 195.563. PHMSA’s evaluation was to determine if PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 10 of 26 <<>> the special permit request should be granted to allow Hilcorp to deviate from the Pipeline safety regulations or whether the pipeline design must comply fully with 49 CFR Part 195. As stated above, PHMSA has no authority over pipeline siting or whether a pipeline is constructed. Based on its comparison of the no-action alternative and the proposed alternative, PHMSA proposed extensive technical special permit safety conditions to which Hilcorp must comply. Pursuant to PHMSA’s jurisdiction under the Federal Pipeline Safety Laws and Regulations, Hilcorp may withdraw its special permit request at any time and construct a pipeline that fully complies with 49 CFR Part 195. In that case, Hilcorp would not require a permit from PHMSA. 7) Stakeholder Comment: In the alternatives analysis, the agency must provide sufficient evidence and analysis for determining whether to prepare an environmental impact statement or a finding of no significant impact. The analysis must “rigorously” explore and objectively evaluate all reasonable alternatives. While an agency is not obliged to consider every alternative to every aspect of a proposed action, the agency must consider such alternatives to the proposed action as may partially or completely meet the proposals goal. In its draft EA, PHMSA considered only two alternatives: granting the special permit (the proposed action) and denying the special permit (the no-action alternative). In examining only these two alternatives, PHMSA failed to “rigorously explore” and “objectively evaluate” all reasonable alternatives to allowing Hilcorp to deviate from the Federal Pipeline Safety Regulations. For example, PHMSA failed to examine an alternative that would require a PIP system with CP, which is particularly inappropriate considering Hilcorp’s stated intent to construct a PIP system and the draft EA’s statement that stakeholders preferred this construction.  PHMSA Response: PHMSA has no authority to impose the selection of a distinct alternative that exceeds the regulatory requirement. As stated above, assuming approval from other cooperating agencies, Hilcorp could proceed with construction of pipeline that complies with 49 CFR Part 195 without a permit from PHMSA. Nonetheless, PHMSA has carefully analyzed the proposed design of Hilcorp’s proposed Liberty Pipeline, which deviates from 49 CFR Part 195. PHMSA analyzed all potential threats that could affect the pipeline, given the PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 11 of 26 <<>> proposed pipe in pipe design, and developed an extensive set of proposed conditions that are designed to ensure a level of safety that meets or exceeds the safety level in 49 CFR Part 195. PHMSA notes that the proposed casing pipe would be cathodically protected but that there is no known mechanism to supply electric current (i.e. CP) to a 5-mile inner/carrier pipeline that is welded inside a vacuum-sealed annulus. PHMSA is aware of any pipeline, whether jurisdictional to PHMSA or not, that utilizes a pipe in pipe design with CP reaching the inner/carrier pipeline. 8) Stakeholder Comment: PHMSA failed to consider an alternative that would include additional conditions in the special permit, such as increased inspection requirements. The failure to consider additional conditions is an especially glaring omission given that most proposed conditions merely recite the proposed pipeline design or regulatory requirements with which Hilcorp would be required to comply regardless of the issuance of the special permit. PHMSA also failed to consider an alternative that would restrict the time of year in which the pipeline operates, such as restricting activities from April to October, when waters near the Liberty Project are designated as biologically important areas for bowhead whale feeding, migration, and reproduction.  PHMSA Response: PHMSA is requiring the Liberty Pipeline to be inspected more frequently and with a varied suite of assessment tools than existing pipeline safety regulations in 49 CFR Part 195. In addition, PHMSA is mandating the environmental conditions of the PIP annulus be controlled and monitored to prevent the creation of a corrosive environment. In order to respond to public concerns, the intervention threshold to address integrity threats has been lowered to allow more time to schedule and repair the pipeline when the least environmental damage is done. (See Special Permit Conditions 11, 13, 15-17, 21- 32.) 9) Stakeholder Comment: The draft EA fails to take a hard look at the environmental impacts of granting the special use permit, including the increased risk of oil spills. All oil drilling is inherently dangerous and results in both chronic and disaster-related oil spills. An oil spill in the Arctic would have especially dire consequences for the environment and be impossible to clean up. The risks of oil spills are especially PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 12 of 26 <<>> heightened given the harsh Arctic environment and Hilcorp’s documented history of accidents and safety violations. But PHMSA’s Draft EA fails to adequately consider these realities.  PHMSA Response: The lead agency BOEM published a final environmental impact statement (FEIS), which analyzed the potential impacts from an oil spill resulting from a failure of the proposed Liberty Pipeline. That analysis is available at https://www.boem.gov/Appendix-A-OSRA/. In the selected alternative that analyzes issuance of a special permit to allow the pipe in pipe design, which PHMSA developed in response to Hilcorp’s special permit application, oil released from a failure of the inner/carrier pipe would be contained in the annular space between the inner/carrier pipe and the outer/casing pipeline. As a special permit condition, Hilcorp must install on the Liberty Pipeline a pressure relief valve connecting the annular space to secondary containment vessels (Special Permit Condition 21). 10) Stakeholder Comment: Climate change is causing, and will continue to cause, sea level rise, sea ice melt, and permafrost melt in the Beaufort Sea. Moreover, Alaskan shorelines are eroding at an accelerating rate due to the combined effects of sea-ice loss, increasing sea surface temperatures, increasing terrestrial permafrost degradation, rising sea levels, and increases in storm power and corresponding wave action. Indeed, coastal erosion rates have doubled in the past 50 years along the Beaufort Sea shoreline. Such destabilization can increase the risk of oil spills. For example, the Liberty DPP acknowledges that sea level will rise, and that this will increase the frequency and intensity of strudel scour, which can destabilize pipelines via upheaval buckling.  PHMSA Response: The Liberty Pipeline special permit conditions have been changed to address the continued permafrost degradation, reduced stable sea ice period needed to construct and maintain subsea pipelines, and the risks associated with responding to potential spills in broken ice conditions. PHMSA believes the entire pipeline must be kept in serviceable condition in order to complete the mandated actions on the PIP segment. For that reason, the special permit conditions, including the assessment and repair criteria, are being extended beyond the PIP portion of the Liberty Pipeline project and will apply to the entire PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 13 of 26 <<>> Liberty Pipeline. (See Special Permit Conditions, “Special Permit Segment” definition). 11) Stakeholder Comment: PHMSA’s draft EA fails to address the real and significant risk of subsidence. Changing environmental conditions will impact the stability and operations of the drilling island and pipeline. This will also impact the safety and vulnerability of the operations, increasing the risk of accidents, oil spills, and other hazards. Permafrost melt will impact the pipelines and other infrastructure over the life of the project. These predictable changes in the near future must be analyzed and disclosed in an EA.  PHMSA Response: The operator is required by existing Federal Pipeline Safety Regulations, specifically the integrity management regulations (49 CFR 195.452), to identify, assess and address risks that may impact the integrity and safe operation of their pipeline systems. Special Permit Condition 23 – Monitoring and Determination of Pipeline Strains and Condition 24 – Integrity Assessment will require integrity monitoring for any Liberty Pipeline subsidence and strains through the development and implementation of strain monitoring procedures and the usage of multi-dimensional geospatial pipeline mapping tools for pipeline movement and settlement, and the usage of high resolution deformation in-line inspection tools for pipeline bending or buckling. PHMSA will inspect this pipeline to ensure Hilcorp is in compliance with the existing integrity management regulations and this special permit, and will confirm Hilcorp is addressing the changing environmental conditions and that their safety measures are confirmed for effectiveness through regular ILI assessments. 12) Stakeholder Comment: According to the Alaska Oil and Gas Conservation Commission (AOGCC), Hilcorp has a documented pattern of safety violations and disregard for compliance with the law in Alaska. As documented by AOGCC, Hilcorp had more than two dozen violations over a 3.5-year period—so many that the agency concluded that “disregard for regulatory compliance is endemic to Hilcorp’s approach to its Alaska operations. In addition to these actions and violations documented by AOGCC, PHMSA itself has sent Hilcorp numerous warning letters for probable violations of pipeline safety regulations in Alaska since November 2015. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 14 of 26 <<>>  PHMSA Response: PHMSA will monitor Hilcorp’s compliance with the special permit conditions and take appropriate action if Hilcorp shows any disregard for compliance with the Permit conditions or applicable pipeline safety regulations. The special permit specifies that PHMSA has the sole authority to make all determinations on whether Hilcorp has complied with the specified conditions of the permit. Under 49 CFR 190.341(j), PHMSA has the authority to revoke, suspend, or modify the Special Permit if it finds that Hilcorp has failed to comply with any material term or condition of the permit. Finally, the special permit specifies that PHMSA may issue an enforcement action to Hilcorp if they fail to comply. PHMSA is committed to monitoring Hilcorp’s compliance with the terms and conditions of this special permit. 13) Stakeholder Comment: Hilcorp should run a second set of tests before implanting any sort of pipeline. These tests should center around the parameters they missed beforehand such as ice gouging frequency, corrosion, upheaval buckling, and occurrence probabilities for thaw subsidence.  PHMSA Response: The special permit conditions require Hilcorp to conduct extensive tests during and immediately after construction of the Liberty Pipeline to ensure the pipeline is ready to receive fluids. PHMSA is also requiring, in exceedance of existing regulations, another inline inspection tool assessment shortly after commissioning the pipeline to confirm that the pipeline design, construction, and operation have not manifested any problems or pose a risk to the sensitive Arctic environment. (See Special Permit Conditions 24(a) through (d)). Analysis: PHMSA developed the special conditions to achieve an equivalent or higher level of safety by significantly decreasing the likelihood of a release of product (crude oil) in the special permit segment. The special permit conditions are summarized in this section. Hilcorp requested the CP requirements in 49 CFR 195.563 and 195.573 be waived for the following reasons: 1) Hilcorp seeks a special permit to operate the inner, sales oil, or carrier pipe without CP. The special permit would waive the requirements of 49 CFR 195.563(a) and 195.573. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 15 of 26 <<>> This section states in part: “Each buried or submerged pipeline that is constructed, relocated, replaced, or otherwise changed after applicable date in 49 CFR 195.401(c) must have cathodic protection.” 2) CP is a method to control corrosion by minimizing the difference in electrical potential between an anode and a cathode. This is achieved by applying a current to the pipeline, ideally resulting in a single potential for the entire pipeline, thereby eliminating potential differences on the pipe. 3) The PIP configuration makes it impractical to install or monitor a CP system on the inner pipe primarily due to the limited annular space between the inner and outer pipes, and due to the fact that the annulus would be sealed at each end to provide an airtight environment. If properly dried prior to operations startup and successfully maintained, the inner pipe will not be exposed to an electrolyte such as seawater, soil, oxygen, or water vapor. The National Association of Corrosion Engineers (NACE) defines corrosion as “the deterioration of a material, usually metal, which results from the reaction with its environment.” (NACE SP0169-2007 at page 2.) Even if it were practical to apply CP to the inner pipe, the protection would serve no purpose in the absence of an electrolyte. 4) The special permit allows Hilcorp to use a PIP system along with implementing the special permit conditions, which are designed to prevent the entry of moisture into the casing and detect its presence in the event that these measures are not effective. A PIP system also provides protection from external forces, secondary containment in the event of a release from the sales oil pipeline, and additional methods for detecting leaks if a spill were to occur. Nonetheless, the purpose of the proposed special permit would be to impose enforceable safety conditions to ensure the integrity of the casing pipe and annulus, so that the inner carrier pipeline is protected to an equal or greater extent as a pipeline that operates with CP, in accordance with 49 CFR 195.563(a). 5) The PIP design will use a heavy wall (0.500-inch wall thickness) inner carrier pipe and heavy wall (0.625-inch wall thickness) outer casing pipe to provide superior protection from failures caused by external forces. In the unlikely event of an inner pipe failure, a combination of the outer casing pipe, monitoring of the PIP annulus, and external storage capacity allows for detection of such a failure and containment PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 16 of 26 <<>> of a release of oil from the inner pipe. In the unlikely event of a rupture of the carrier pipe, the outer casing pipe would protect against the release of oil into the environment because the annulus will be equipped with continuous pressure monitoring and a relief valve tied into external storage. Therefore, if a leak were to occur in the carrier pipe, pressures inside of the PIP/annulus would not cause the 16-inch casing to leak or rupture. Operational Integrity Compliance: PHMSA has reviewed this special permit request to ensure that integrity threats to the pipeline in the special permit segment are addressed in the operator’s design, material, construction, operations and management plan (O&M Procedures and specifications). PHMSA carefully designed a comprehensive set of conditions that Hilcorp is required to meet in order for the special permit to be granted for the Liberty Pipeline special permit segment. The special permit conditions are available in Docket No. PHMSA-2017-0091 at: www.regulations.gov. A summary of the special permit conditions are below: 1. Applicable Regulations o States that all regulations, except those specifically waived will apply to the pipeline. 2. Maximum Operating – Pressure, Temperature, Strain and Stress Limits for the Pipeline o Limits strains, temperature and pressure that can damage and cause wear to the steel pipeline. This condition specifies the design and operating parameters upon which the special conditions are predicated. o Due to the significant strains imposed on the pipeline due to environmental conditions and design, the strain parameters will be imposed to limit the strain that can lead to integrity threats and the longevity of the pipeline. 3. Integrity Management Program o Hilcorp will be required to treat the pipe in pipe segment as a high consequence area, meaning that the safety requirements 49 CFR 195.452 apply. 4. Design, Specifications and Procedures o Hilcorp will be required to develop and implement written procedures for the material, design, construction, operations and maintenance of the pipeline. o These conditions are intended to prevent conditions that could lead to unintended stresses, strains, or creation of defects to or on the pipeline. 5. Pipe – Carrier o The permit will require the carrier pipe to be 12.75-inch diameter and have 0.500- inch wall thickness. o Includes specifications to ensure proper pipe manufacturing processes and mill testing, required strength, diameter, toughness, and thickness. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 17 of 26 <<>> 8. Bends o These requirements will protect the pipeline against, strains, corrosion, and cracking. The mill tests seek to identify metal defects that could threaten integrity throughout the life of the pipeline. 6. Carrier Pipe Toughness o This condition requires the use of Charpy-V-Notch (CVN) impact tested in accordance with API 5L, which ensures a high level of metal toughness. o Toughness in metal is the ability to absorb energy and plastically deform without fracturing. This quality helps protect against pipeline failure. 7. Carrier Pipeline Design Factor o The pipeline design factor is a maximum of 0.72. The bulkhead fitting and tie-in piping (two (2) pipe joints on each side of bulkhead for the 12.75-inch diameter carrier pipe) must have a maximum design factor of 0.60. o These design factors ensure that the pipeline facility is designed to handle a greater level of pressure and strain than actually anticipated on the pipeline. o No manufactured hot bends or field cold bends are allowed for the subsea cased pipeline, and segments from buried to above ground at the shore must gradually sweep to shore. Directional changes in the pipeline must maintain specific stress levels below industry standards. o Excessive forces can collect at manufactured or field bends, thereby causing damage (e.g. cracking). This requirement reduces the risk of failure along bends in the pipeline. 9. Flanges and Fittings o Flanges and fittings must comply with specific industry standards so that they have sufficient strength to withstand the Design and Operating Parameters. 10. CP – Carrier and Casing Pipe o The casing pipe will be cathodically protected in compliance with 49 CFR 195.563. CP is an electric current applied to a pipeline to prevent corrosion. CP slows or prevents corrosion from occurring in areas where the coating has become disbonded or been removed from the pipe. o The special permit will require a fusion bonded epoxy coating on the casing pipe external surface. This coating type should prevent corrosion (where it is not damaged) and will not shield the CP from the pipe, which could allow for aggressive corrosion. It is not possible to apply CP to the carrier/inner pipe as required by the Pipeline Safety Regulations, which is the reason Hilcorp requested the special permit from PHMSA. o The 16-inch casing pipe must be internally coated with the exception of a short segment (less than 4-inches wide) at pipe girth welds. This requirement is a contingency to the possible loss of a dry, inert annulus environment and the creation of a potentially corrosive environment between the 12.75-inch carrier and 16-inch casing (internal portion of the casing). The internal casing pipe coating will help to keep internal steel mill scale and corrosion pitting from occurring after pipe manufacturing and during the transportation, storage, construction and commissioning stages of the pipeline. Since the 12.75-inch carrier pipe is being inserted into the 16-inch casing pipe, it is impracticable to coat the 4-inch wide PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 18 of 26 <<>> area at girth welds inside the 16-inch casing due to clearance space issues between the casing and carrier pipes. 11. PIP Design o In the event of a failure of a pipeline that fully complied with the 49 CFR Part 195, as in the no-action alternative, a pipeline failure would result in a release of the contents of the pipeline into the environment at a high pressure. Hilcorp is requesting to use a pipe in pipe design so that, in the event of a failure of the carrier pipe, the casing pipe will contain the crude oil that would otherwise be released into the Beaufort Sea. To ensure the functionality of this design Hilcorp will be required to:  Fill the sealed space between the carrier/inner pipe and the casing/outer pipe, known as the “annulus” or “annular space” with an inert gas such as Nitrogen or Argon. Unlike ambient air, which includes oxygen, this inert gas will not react with the pipeline metal to cause corrosion.  Maintain the pressure of the inert gas in the annulus at -10 pounds per square inch gauge (psig), which is a slight vacuum through connection to a vacuum system.  Monitor the pressure of the annulus. In the event of an increase in pressure, it may signal a breach of the carrier pipe, in which case the annulus could fill with crude oil. An increase in pressure may also signal a breach in the casing pipe, in which case the annulus could fill with sea water.  Maintain dew point and monitor the temperature of the annular space. A dew point at or below -10 °F to prevent liquid drop out, in the event that any water vapor remains within the inert gas. Water condensation in the annulus could cause external corrosion to the carrier and casing pipe. In the event of an increase in pressure in the annulus, temperature monitoring showing a low temperature could indicate the presence of sea water, and a high temperature could indicate the presence of crude oil. 12. PIP Bulkhead Design o The special permit will include requirements for the bulkhead fittings to meet the regulations, standards and undergo tests to ensure that they can maintain the high stresses that they will be subject to due to the opposite forces applied by the two pipes. 13. Bundle and Fiber Optic Cable o The bundle will include the PIP system, fiber optic cable, spacers, a utility line, and bundle straps. o The fiber optic cable will be located outside the PIP system and will monitor temperature along the length of the PIP system. It will have the ability to communicate temperature data to the SCADA system. An increase in temperature as recorded by the fiber optic cable could indicate a release of the heated crude oil. o This condition will allow prompt notification of temperature change allowing proper emergency actions. o The bundle must be at least seven feet below the subsea mudline to protect against currents and external forces. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 19 of 26 <<>> 14. Pipe-External Coating o The special permit will include requirements to ensure the proper application, thickness, and repair of the fusion bonded epoxy coating to the pipe. A properly applied coating provides protection against external corrosion without shielding CP. 15. Monitoring System o The special permit will require that the pipeline is monitored at all times for pressure, temperature, and flow rate. Changes in any of these values could indicate a failure of the pipeline or an emergency situation. o The special permit conditions specify the placement of remote closure valves, pressure and temperature transmitters, and flow meters. 16. Casing Pipe- Design and Operating Properties o The special permit will require that the outer casing pipe meet specific design specifications and undergo certain tests to ensure strength and toughness of the pipe metal. o The special permit will set specific parameters for normal operating pressure, design pressure, maximum operating pressure, temperature, maximum allowable combined stress, and annulus relief valve pressure. o Operating within these parameters protects the pipe metal from additional fatigue and stresses that could threaten the integrity. 17. Construction Quality Control o The special permit will require that Hilcorp develop and implement a right of way construction monitoring program for procedures, specifications, and training personnel in all aspects of pipeline construction, including:  pipe inspection,  hauling and stringing pipe,  welding,  non-destructive examination of girth welds,  applying and testing field applied coating,  lowering the pipeline into the subsea trench,  backfilling, and  hydrostatic testing including dewatering and drying. o The special permit will require that Hilcorp develop a Subsea Trench Quality Control Plan and Procedures, which would require:  chemical testing of trench soils to predict corrosion risks,  trench depth monitoring,  trench bottom roughness profiling,  backfilling requirements, and  use of pipe end protection caps to keep out water during construction. o Coating application quality control specification for external coatings of both casing and carrier pipe must be developed, implemented, and personnel must be trained to ensure carrier and casing pipe surface cleanliness, application temperature control, adhesion quality, cathodic disbondment, moisture permeation, bending, and minimum coating thickness for girth weld and repair coatings. Both the carrier and casing pipe must be externally coated for corrosion protection. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 20 of 26 <<>> 18. Carrier Pipeline Girth Welds o The special permit will include requirements for welding procedures and welder tests. If a carrier girth weld test reveals a crack in the weld, the cracked weld must be cut out. o Over the life of a pipeline, defects in welds resulting from improper procedures can develop into threats to the pipeline integrity, especially for pipelines with higher levels of stress. o The carrier pipe and coating must be protected from weld splatter. 19. Casing Pipe Girth Welds o The special permit will include requirements for welding procedures weld tests. If a casing girth weld test reveals a crack in the weld, the crack must be cut out. o Over the life of a pipeline, defects in welds resulting from improper procedures can develop into threats to the pipeline integrity, especially for pipelines with higher levels of stress. 20. Casing Isolators o The special permit will require maximum casing isolator spacing of 10 feet consistent with manufacturer specifications. o The special permit would require the casing isolators to withstand anticipated pipeline loads, deflection, and movement in order to maintain continuous separation between the carrier and casing pipe. 21. Relief Storage Tank o The special permit will require that a pressure increase in the annulus, caused by the annulus filling with oil or seawater to activate a relief valve, and discharge the fluid to a relief storage tank or vessel of adequate capacity. o In the event of a failure to the carrier pipe, the pressure would rapidly increase in the annulus. This could cause an overpressure situation the annulus, and a defect in the unpiggable casing could lead to failure, which would lead to oil discharging into the Beaufort Sea. 22. Operations & Maintenance (O&M) Procedures o The special permit will require Hilcorp to develop and implement O&M procedures for operating personnel to ensure proper operation of the CP system, the monitoring of the annulus, implementation of integrity management, and other operating parameters such as monitoring pressure and temperature. o Rigorous and detailed O&M procedures are intended to reduce the risk of oversight or human error in the operation of the pipeline that could lead to the creation or growth of damage, corrosion, or strain to the pipeline. 23. Monitoring and Determination of Pipeline Strains o The special permit will require that if specific locations of the pipeline experience high levels of strain, as detected through ILI tools or otherwise, strain demand monitoring processes or devices will be installed or implemented. If high strain is identified, the special permit will require procedures to monitor, evaluate, model, and mitigate strain. o This monitoring will be intended to prevent the development and growth of anomalies on the pipeline, such as bending, denting, buckling, crumpling, cracking or corrosion that can directly or indirectly result from strain accumulating in vulnerable areas of the pipe. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 21 of 26 <<>> 24. Integrity Assessments o The special permit will require Hilcorp to perform pipeline assessments using the prescribed ILI tools at the following intervals:  Before Pipeline Startup:  high resolution (HR) deformation tool,  multi-dimensional geospatial mapping tool, and  remediate anomalies; all dents treated as “top side” dents.  Baseline Assessment- within 15 months of startup, run following tools:  HR metal loss,  HR deformation, and  multi-dimensional geospatial mapping.  Second Assessment- within 39 months of startup, run following tools:  ultrasonic technology (UT) for metal loss and cracking,  HR Deformation, and  Multi-dimensional geospatial mapping.  Periodic Assessments- every 2 to 3 years depending on existing integrity data:  HR metal loss,  HR deformation,  multi-dimensional geospatial mapping, and  ultrasonic (UT) for metal loss and cracking every other assessment. o The special permit will require that Hilcorp install a calibration spool with the same PIP design with certain installed defects to test ILI tool accuracy because calibration digs are not feasible in the subsea environment. o If tool data reveals contact between the carrier and casing pipe, Hilcorp must run HR-deformation and Multi-dimensional geospatial pipeline mapping tools, assess the tool data remediate as required by Part 195. o These conditions require Hilcorp to run specific ILI tools more often than required by 49 CFR Part 195 is intended to more quickly identify and respond to risks posed by the forces imposed on the carrier and casing pipe that can lead to the creation and growth of anomalies, which can cause failure. The tool runs would detect the presence and characteristics of anomalies, allowing the operator to remediate or monitor the anomalies, as required. 25. Analysis of ILI Tool Data and Discovery of Actionable Anomalies o The special permit will require Hilcorp to factor in ILI tool accuracy and applicable anomaly growth rates when analyzing ILI tool data. o The purpose of this condition will be to reduce risk posed by anomalies by attempting to ensure rigorous and accurate characterization of anomalies so that they are remediated in an appropriate time frame, that also meets permitting and scheduling requirements to minimize environmental disturbance, so that they are not able to threaten pipeline integrity. 26. Engineering Critical Assessment for Cracks o The special permit will require that Hilcorp perform an Engineering Critical Assessment for any crack 50% or less of wall thickness in the inner carrier pipe. Any crack greater than 50% wall thickness or of a certain failure ratio would be treated as an immediate repair. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 22 of 26 <<>> o The purpose of this condition is to remediate cracks of a lesser depth than required by 49 CFR Part 195 due to the risks from strain. 27. Leak Detection System o The special permit will require:  a mass balance system with flow meters at pipeline intersection points,  a PIP annulus monitoring system for pressure and temperature, and  a fiber optic cable with temperature monitoring. o These conditions are intended to ensure that changes to the annulus and external temperature that could indicate a failure of either the carrier pipe or casing pipe are quickly identified so that Hilcorp can take proper remediation/response actions. 28. Monitoring Systems – Carrier Casing Pipe and PIP Annulus o This condition will require monitoring for changes in: pressure, temperature, settlement, flow, and dew point. o These conditions are intended to ensure that changes to the carrier, casing, and annulus that could indicate a failure of either the carrier pipe or casing pipe are quickly identified so that Hilcorp can take proper remediation/response actions. 29. Monitored Response Procedures o This condition will require that if the carrier pipe temperature exceeds the maximum design temperature of 150° F, Hilcorp must reduce the operating temperature within two hours. If temperature exceeds 150° F for more than 24 hours, Hilcorp must notify PHMSA. o The special permit condition will require monitoring and notification to PHMSA for specific temperature changes to the soil surrounding the bundle. o These conditions protect against excessive heat that can damage the pipeline and require monitoring for temperature changes that can indicate a failure has occurred. 30. CP System Monitoring of the Casing Pipe o This condition will require that the casing pipe is cathodically protected within six (6) months of the placing the subsea segment into service. The inner carrier pipe cannot be cathodically protected, which is the reason that Hilcorp submitted the special permit request. o Hilcorp will have to install test leads and perform close interval surveys one (1) year after construction and then every five (5) years. If more than 20% of test leads fail, the close interval frequency will change to every three (3) years. o This condition contains specifications about the CP monitoring system and procedures. CP potential readings would be taken yearly and according to specifications in the special permit. o These conditions are intended to ensure consistent CP on the casing pipe. When properly maintained, CP provides strong protection against corrosion. The tests are intended to find any gaps in protection. 31. SCADA and CPM Systems o The supervisory control and data acquisition (SCADA) and computational pipeline monitoring (CPM) leak detection systems will be required to comply with 49 CFR 195.444 and 195.446. 32. Data Integration PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 23 of 26 <<>> o This special permit condition requires that Hilcorp conduct, maintain, and annually update data integration for all special permit findings and remediation. PHMSA may request this data starting with the 2nd annual report. o These conditions are intended to ensure that Hilcorp properly integrates data to view its system holistically, to better identify and remediate pipeline safety threats. 33. Environmental Assessments and Permits o The special permit will require Hilcorp to evaluate environmental consequences of land disturbances or water crossings needed to implement the proposed special permit conditions. Hilcorp must comply with all local, state, and federal environmental permits in this process. 34. Notices to PHMSA o This special permit condition requires Hilcorp to provide various notifications to PHMSA during the design and construction and within 2 business days of discovery of an immediate repair condition to ensure close oversight. o This condition allows PHMSA to proactively identify issues. 35. Annual Report o This special permit condition requires Hilcorp to prepare and submit an annual report to PHMSA and the public that includes the following information:  any Integrity threats identified by ILI tools,  all reportable incidents,  all repairs,  any ongoing damage prevention, corrosion, and longitudinal strain preventative initiatives and a discussion of the success of the initiatives,  data integration information, including irregular changes in pressure, temperature, and due point Instances the pipeline exceeded operational parameters, and  corporate changes affecting regulatory responsibilities. o This condition allows PHMSA and the public to have a strong understanding about the integrity threats and maintenance of the pipeline to ensure compliance and sound decision-making. 36. Documentation o This special permit condition will require Hilcorp to maintain and provide the following upon request:  Records are required by 49 CFR Part 195 and 8-hour hydrostatic test at 1.25 times maximum operating pressure.  Steel mill test reports showing wall thickness, yield strength, tensile strength, and chemical composition. This must be maintained for the life for the life of this special permit. o This condition requires the maintenance of records that are critical to understanding potential integrity risks both in the short term and long term life of the pipeline. 37. Certification o A Hilcorp senior executive officer, vice president or higher must certify:  The pipeline meets the special permit conditions. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 24 of 26 <<>>  The O & M manual has been updated to include all additional operation and maintenance requirements of the special permit.  Documentation requirements are complete.  All certification requirements in the special permit are complete. o This condition requires the involvement and oversight of a Hilcorp senior executive officer to better ensure compliance, communication, and awareness. The special permit contains conditions to ensure Hilcorp meets or exceeds the threshold requirements with equivalent safety and to ensure that granting the special permit will not be inconsistent with safety. Although the proposed inner pipeline will not receive CP as required by 49 CFR Part 195, PHMSA finds that the design, construction, and operation of the carrier pipeline, when in full compliance with the conditions described in the special permit, will meet or exceed the level of safety that a pipeline operating in full compliance would achieve. The casing protects the carrier/inner pipeline from exposure to an electrolyte, therefore reduces the risk of pipeline wall thinning due to corrosion. The casing also protects the sales oil pipeline from external force damage. The casing will also be connected to a relief storage containment, which could contain crude oil leakage from the carrier pipe, in the event of an increase in pressure and failure of the casing pipe. The casing pipe and the annulus further provides a thermal barrier between the sales oil pipeline and the surrounding environment, which would reduce the potential thaw settlement, and reduce the calculated pipe stresses. Past Enforcement History – January 1, 2008 through February 26, 2019 Since the beginning of 2008 through February 26, 2019, Hilcorp was cited in 14 enforcement cases with a total of $198,700 in proposed civil penalties. PHMSA initiated three (3) Notices of Amendments, one (1) notice of probable violation, one (1) safety orders, and nine (9) Warning Letters against Hilcorp. Below is a table of PHMSA enforcement matters of all types in all PHMSA Regions for Hilcorp from January 1, 2008 through February 26, 2019: PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 25 of 26 <<>> Notice of Status Corrective Action Order Notice of Safety Probable Amendment Order Warning Letter Total Violation CLOSED 0 3 0 0 9 12 OPEN 0 0 1 1 0 2 Total 0 3 1 1 9 14 PHMSA has determined that imposing the conditions and limitations summarized in this document will ensure that granting the special permit for lack of CP in the special permit segment of will not be inconsistent with safety. Findings: Based on the information submitted by Hilcorp and PHMSA’s analysis of technical, operational and safety issues, and given the conditions that will be imposed in the special permit, PHMSA finds that granting this special permit to Hilcorp to operate the Liberty Pipeline special permit segment originating on the Liberty Island in the OCS and extending south into State of Alaska waters, to a shore crossing approximately 5.68 miles from the island located west of the Kadleroshilik River Delta, without CP of the 12.75-inch diameter pipe will not be inconsistent with pipeline safety. Completed in Washington DC on: April 29, 2019 Prepared By: PHMSA – Engineering and Research Division PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline - Analysis & Findings Page 26 of 26 <<>> U.S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION FINAL ENVIRONMENTAL ASSESSMENT and FINDING OF NO SIGNIFICANT IMPACT Special Permit Information: Docket Number: PHMSA-2017-0091 Requested by: Hilcorp Alaska, LLC Date Requested: March 24, 2017 Original Issuance Date: April 29, 2019 Effective Dates: April 29, 2019 to April 29, 2029 Code Section(s): 49 CFR 195.563 and 195.573 I. Background The Pipeline and Hazardous Materials Safety Administration (PHMSA) noticed on October 15, 2018, in the Federal Register (83 FR 52050) a special permit request by Hilcorp Alaska, LLC (Hilcorp), owner and operator of the Liberty Sales Oil Pipeline (Liberty Pipeline). The Liberty Pipeline is approximately 7.2 miles of 12.75-inch diameter pipeline that is jurisdictional to 49 Code of Federal Regulations (CFR) Part 195. The Liberty Pipeline special permit will waive compliance with 49 CFR 195.563 and 195.573. This Final Environmental Assessment (FEA) describes Hilcorp’s request including the location of the pipeline, operational review, any effect to safety and the environment, and the special permit conditions. In accordance with the Department of Transportation’s (DOT) Order 5610.1C, the National Environmental Policy Act (NEPA), 42 United States Code (U.S.C.), 4321–4375, and the Council on Environmental Quality regulations, 40 CFR 1500-1508, the processing of a special permit application involves the preparation of an FEA. NEPA requires that agencies analyze PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 1 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 a proposed action to determine whether the action will have a significant impact on the human environment. As required by 49 CFR 190.341, PHMSA analyzes special permit requests for potential risks to public safety and the environment that could result from our decision to grant or deny the request. As part of this analysis, PHMSA looks at whether a special permit would impact the likelihood and consequences of a pipeline failure as compared with a pipeline that operates in full compliance with the pipeline safety regulations. PHMSA may grant the special permit request, grant the request with additional conditions, or deny the request. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 2 of 50 <<>> Liberty Pipeline – Special Permit – FEA and FONSI - Docket: PHMSA-2017-0091 Table of Contents TABLE OF ACRONYMS .....................................................................................................................4 1. INTRODUCTION ....................................................................................................................6 2. BACKGROUND ......................................................................................................................7 3. PURPOSE AND NEED ..........................................................................................................10 4. SITE DESCRIPTION ......................................................................................................... 14 5. FINAL ACTION AND ALTERNATIVES ..................................................................................... 15 5.1 Alternative 1: No Action Alternative ........................................................................................... 15 5.2 Alternative 2: Special Permit Action ........................................................................................... 16 6. COMPARATIVE SAFETY AND ENVIRONMENTAL IMPACTS OF THE FINAL ACTION AND ALTERNATIVES ..... 18 7. CONSULTATION AND COORDINATION ................................................................................. 36 8. FINDING OF NO SIGNIFICANT IMPACT ................................................................................. 49 9. BIBLIOGRAPHY ............................................................................................................. 49 Index of Figures FIGURE 1 – LIBERTY AREA OVERVIEW MAP ………………………………………………………………………...7 FIGURE 2 – PIPELINE BUNDLE CROSS SECTION …………………………………………………………………….8 FIGURE 3 – OVERVIEW OF SPECIAL PERMIT (OFFSHORE) SEGMENT …………………………………...10 FIGURE 4 – TYPICAL TRENCH SECTION – OFFSHORE ZONE ………………………………………………….17 FIGURE 5 – BULKHEAD SCHEMATIC …………………………………………………...................................18 PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – FEA and FONSI Page 3 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 Table of Acronyms °F degrees Fahrenheit 3LPE three-layer polyethylene AOGCC Alaska Oil and Gas Conservation Commission API American Petroleum Institute ARO abrasion resistant overcoat BOEM Bureau of Ocean Energy Management BOPD barrels of oil per day CFR Code of Federal Regulations CP cathodic protection CPM computational pipeline monitoring (CPM) CVN Charpy-V-Notch DIA diameter DOT U. S. Department of Transportation EIS Environmental Impact Statement FBE fusion bonded epoxy FEA Final Environmental Assessment FR Federal Register FEIS Final Environmental Impact Statement HCA High Consequence Area Hilcorp Hilcorp Alaska, LLC HR high resolution ILI in-line inspection Liberty Pipeline Liberty Sales Oil Pipeline MOP maximum operating pressure MP milepost NACE National Association of Corrosion Engineers NEPA National Environmental Policy Act NOAA National Oceanic and Atmospheric Administration NPS nominal pipe size NMFS National Marine Fisheries Service OCS Outer Continental Shelf O&M Operations & Maintenance PHMSA Pipeline and Hazardous Materials Safety Administration PIP pipe-in-pipe PSA Pipeline Safety, Regulatory Certainty and Job Creation Act psig pounds per square inch gauge SCADA supervisory control and data acquisition SPCS State Pipeline Coordinator’s Section TWS The Wilderness Society U.S. United States PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 4 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 USFWS United States Fish and Wildlife UT ultrasonic technology VSM vertical support member WT wall thickness PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 5 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 1. Introduction The following final environmental assessment (FEA) considers the Hilcorp Alaska, LLC (Hilcorp) application for a special permit, in accordance with 49 CFR 190.341(c)(8) for the Liberty Development and Production Plan (Liberty DPP). The special permit is one of a number of Federal and State of Alaska permits and approvals that Hilcorp is seeking in connection with development of the Liberty Oil Field, located off Alaska’s North Slope, on the Outer Continental Shelf (OCS). The Liberty Pipeline special permit waives compliance with PHMSA regulations 49 CFR 195.563 and 195.573. The Bureau of Ocean Energy Management (BOEM) is the lead federal agency conducting the environmental reviews for the Liberty DPP. The National Marine Fisheries Service (NMFS) and the United States Fish and Wildlife (USFWS) issued biological opinions to BOEM for the Liberty DPP on July 31, 2018 and July 13, 2018, respectively. On August 31, 2018, BOEM published a Notice of Availability in the Federal Register for the Final Environmental Impact Statement (FEIS) for the construction of Liberty Drilling and Production Island and the siting of the Liberty Pipeline. BOEM announced the availability of the Record of Decision for the FEIS for the Liberty DPP in the Beaufort Sea Planning Area in the Federal Register (83FR54136) on October 26, 2018, at https://www.federalregister.gov/documents/2018/10/26/2018- 23366/environmental-impact-statement-on-the-liberty-development-and-production-plan-in-the- beaufort-sea. The Record of Decision identifies the BOEM's selected alternative for the Liberty DPP. The Record of Decision and associated information are available on BOEM's website at. https://www.boem.gov/liberty/. This FEA considered only the pipeline design, construction, operation, and maintenance of the Liberty Pipeline, which is jurisdictional to PHMSA. To avoid duplication, PHMSA references information and analysis in BOEM’s FEIS where appropriate. The FEA evaluates the waiver through a special permit of cathodic protection (CP) requirements for the inner/carrier sales oil pipe, allowing the use of a Pipe-In-Pipe (PIP) system. The potential environmental impact of the Liberty project as a whole is addressed in the FEIS. This FEA PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 6 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 analyzes environmental and safety risks of the waiver of CP requirements for the carrier pipe and has conditions intended to ensure the integrity of the Liberty Pipeline so that it is at least as equivalent in safety as full compliance with the Federal Pipeline Safety Regulations. 2. Background Hilcorp is proposing to construct the Liberty Development, a self-contained offshore drilling and production facility located on an artificial gravel island with a pipeline to shore. Hilcorp proposes to build Liberty Island about 5 miles offshore in Foggy Island Bay off the Beaufort Sea OCS in approximately 19 feet of water; about 2 miles west of the Tern Island shoal (see Figure 1). Figure 1 – Liberty Area Overview Map Infrastructure and facilities necessary to drill wells and process and export up to 70,000 barrels of oil per day (BOPD) to shore will be installed on the island. Sales-quality crude oil will be exported from the island through a subsea 12.75-inch diameter x 16-inch diameter PIP system PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 7 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 that is bundled to a 4.5-inch diameter coiled utility line, along with an armored fiber optic cable (see Figure 2). The utility line will be installed as a contingency for possible future use as a fuel gas delivery line or to allow for a circulation loop with the 12.75-inch diameter sales oil line for upset conditions. The utility line will be fully subject to 49 CFR Parts 192 and/or 195 depending on the product ultimately transported by the utility line. The utility line’s compliance with 49 CFR Part 192 or 195 will be determined prior to commencement of operation. Figure 2: Pipeline Bundle Cross Section; (12.75-inch x 16-inch PIP & Bundled 4.5-inch Coiled Utility Line) The Liberty Pipeline bundle will originate on the Liberty Island in the OCS, and will extend south into State of Alaska waters, to a shore crossing approximately 5.68 miles from the island located west of the Kadleroshilik River Delta. At the shore, the pipe will transition to a single- wall, aboveground pipeline supported on vertical support members (VSMs) for 1.5 miles, and continue south to tie into the existing Badami pipeline. Liberty sales oil will be transported through the Badami and Endicott pipelines to the Trans Alaska Pipeline System. The Liberty Pipeline special permit segment includes approximately 5.68 miles of 12.75-inch carrier pipeline installed within a 16-inch casing pipeline, the 16-inch casing pipeline, the annular space between the two (2) pipelines, the two (2) casing to carrier pipe “bulkhead” connections located on each end of the PIP segment, and the connecting 12.75-inch carrier pipeline from the 16-inch casing PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 8 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 pipe to the in-line inspection (ILI) tool launcher and receiver from approximate Milepost (MP) 0.02 and MP 7.25.1 The special permit PIP segment will be located on the OCS of the U.S. Arctic Ocean in the Alaskan Beaufort Sea (see Figure 3) and in the state waters within 3 miles of the coastline. The pipeline will be installed in an area that includes a seasonal appearance of a federally listed threatened and/or endangered species; therefore, it will be defined as an unusually sensitive area under 49 CFR 195.452. The Liberty Pipeline offshore design approach will be the fourth subsea pipeline installed in the Alaskan Beaufort Sea (Northstar, Oooguruk, and Nikaitchuq). The Liberty Pipeline will be the 3rd pipeline in the Beaufort Sea that utilizes a PIP design for the crude oil carrier pipe. However, the two existing PIP pipelines (Oooguruk and Nikaitchuq) are not regulated by PHMSA since these pipelines are carrying non processed crude oil and were deemed to be a production flowline outside of PHMSA’s jurisdiction. Northstar is regulated by PHMSA since the crude oil is processed prior to transportation and uses a conventional single wall pipe design compliant with existing Federal Pipeline Safety Regulations. 1 The “Liberty Pipeline” refers to the entire approximately 7.25 miles of pipeline and supporting facilities that are jurisdictional to 49 CFR Part 195. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 9 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 Figure 3 – Overview of Special Permit (Offshore) Segment 3. Purpose and Need Hilcorp’s request for a special permit is for its planned Liberty Pipeline and waiving compliance from the following corrosion control related sections of the Federal Pipeline Safety Regulations: PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 10 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 1) 49 CFR 195.563, Which pipelines must have cathodic protection? 2) 49 CFR 195.573, What must I do to monitor external corrosion control? This Action will require the issuance of a special permit to allow Hilcorp to construct the subsea PIP system without applying CP to the inner sales oil pipeline as required by 49 CFR 195.563 and 195.573. The Federal Pipeline Safety Regulations require hazardous liquid pipeline operators to have CP to prevent external corrosion and to monitor external CP levels over the entire length of the pipeline. The purpose of the special permit is to waive the specified regulations while imposing additional special permit conditions to assure safety and environmental protection. Specifically, the special permit conditions address the possible introduction of an electrolyte, such as water or oxygen, around the carrier pipe or a metallic short in the carrier pipe, which would create an environment that allows corrosion to occur. Further, the special permit conditions provide a means for assessing the condition of the carrier pipe to ensure its integrity is maintained if the PIP system is compromised. Finally, the conditions are necessary to allow Hilcorp to safely operate the special permit segment at a maximum operating pressure (MOP) of 1,480 pounds per square inch gauge (psig) and a maximum operating temperature of 150 degrees Fahrenheit (°F). Hilcorp seeks a special permit to operate the inner, sales oil, or carrier pipe without CP. The special permit will waive the requirements of 49 CFR 195.563(a) and 195.573. These sections state in part: “Each buried or submerged pipeline that is constructed, relocated, replaced, or otherwise changed after applicable date in 49 CFR 195.401(c) must have cathodic protection.” CP is a method to limit corrosion by minimizing the difference in electrical potential between an anode and a cathode. This is achieved by applying a current to the pipeline, ideally resulting in a single potential for the entire pipeline, thereby eliminating potential differences on the pipe. The PIP configuration makes it impractical to install or monitor a CP system on the inner pipe primarily due to the limited annular space between the inner and outer pipes, and due to the fact that the annulus will be sealed at each end to provide an airtight environment. If properly dried prior to operations startup and successfully maintained, the inner pipe will not be exposed to an electrolyte such as seawater, soil, oxygen, or water vapor. The National Association of PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 11 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 Corrosion Engineers (NACE) defines corrosion as “the deterioration of a material, usually metal, which results from the reaction with its environment.” (NACE SP0169-2007 at page 2.) Even if it were practical to apply CP to the inner pipe, the protection would serve no purpose in the absence of an electrolyte. The special permit will allow Hilcorp to use a PIP system along with implementing the special permit conditions, which are designed to prevent the entry of moisture into the casing and detect its presence in the event that these measures are not effective. A PIP system also provides protection from external forces, secondary containment in the event of a release from the sales oil pipeline, and additional methods for detecting leaks if a spill were to occur. Nonetheless, the purpose of the special permit is to impose enforceable safety conditions to ensure the integrity of the casing pipe and annulus, so that the inner carrier pipeline is protected to an equal or greater extent as a pipeline that operates with CP in accordance with 49 CFR 195.563(a). Hilcorp and its partners have conducted dozens of project meetings with potentially affected stakeholders. Project stakeholders have expressed a strong preference for a double-walled PIP design for the subsea pipeline because of the added protection from external hazards and environmental and safety benefits that this design will provide. The report “An Engineering Assessment of Double Wall Versus Single Wall Designs for Offshore Pipelines in an Arctic Environment” (C-CORE 2000) provides empirical support for the safety, leak detection and environmental benefits of a PIP design. As relevant to Hilcorp’s PIP design, the C-CORE 2000 report provides, in part: The annulus can be charged with gas at a pressure that is distinctly different from both the operating pressure of the inner pipe and the ambient pressure of the water over the pipeline, or left as a vacuum. Redundant pressure monitors on the annulus, integrated into a SCADA system, will provide reliable continuous leak detection monitoring of both inner and outer pipes. (C-CORE 2000 at page 7-50.) Hilcorp’s planned PIP design uses a heavy wall (0.500-inch wall thickness) inner carrier pipe and heavy wall (0.625-inch wall thickness) outer casing pipe to provide superior protection from failures caused by external forces. In the unlikely event of an inner pipe failure, a combination of the outer casing pipe, monitoring of the PIP annulus, and external PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 12 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 storage capacity allows for detection of such a failure and containment of a release of oil from the inner pipe. In the unlikely event of a rupture of the carrier pipe, the outer casing pipe will protect against the release of oil into the environment because the annulus will be equipped with continuous pressure monitoring and a relief valve tied into external storage. Therefore, if a leak were to occur in the carrier pipe, pressures inside of the PIP/annulus would not cause the 16-inch diameter casing to leak or rupture. In addition, the report states: At low annulus pressure, the hoop stress on the outer pipe will be minimal. In the absence of hoop stress, a pipe can tolerate greater axial stress and bending stress. By virtue of the resistance to heat transfer provided by the annulus, the outer pipe in a double walled system would normally be subjected to a lower thermal stress. Further, for pipes all having the same diameter to wall thickness (D/t) ratio, the double walled pipeline system would be flexurally stiffer when exposed to large soil displacements of the type that could be caused by thaw settlement or ice scour. Its increased section modulus would yield a stiffer pipe and generally result in lower bending strain for any given soil displacement field. (C-CORE 2000 at page 7-9.) Hilcorp’s PIP design is intended to provide thermal insulation to reduce the likelihood of thaw settlement of surrounding soils, to reduce longitudinal stresses on the PIP bundle. With respect to the project overall and the construction of the Liberty Pipeline, Hilcorp contends that the Liberty project will benefit the public by producing additional oil reserves and growing the economy by adding jobs and increased tax revenue to federal, state, and local budgets. As the Liberty Unit Operator, Hilcorp is planning to initiate commercial hydrocarbon production of the Liberty Reservoir by the calendar year 2023. U.S. Energy Policy encourages and facilitates domestic oil production. Developing the oil resources of Liberty Unit leases OCS Y-1585, Y- 1650, and OCS T-1886 will also help satisfy mandates of the OCS Lands Act to explore for and develop offshore mineral resources. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 13 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 4. Site Description Agricultural Resources: Agriculture is not practiced in this area due to the climate. However, subsistence activities are described in Section 3.3 of the Liberty FEIS. Water Resources: A description of Environmental Resources is available in Chapter 3 of the Liberty FEIS (https://www.boem.gov/Vol-1-Liberty-FEIS/). See especially Section 3.1.2. Oceanography and Section 3.1.4. Water Quality Air Quality: Air quality is described in Chapter 4.2.3 of the Liberty FEIS (https://www.boem.gov/Vol-1- Liberty-FEIS/. Biological Resources: A description of Environmental Resources is available in Sections 3.1 and 3.2 of the Liberty FEIS (https://www.boem.gov/Vol-1-Liberty-FEIS/). Archaeological Resources: A description of archaeological resources is available in Section 3.3.6 of the Liberty FEIS (https://www.boem.gov/Vol-1-Liberty-FEIS/). Environmental Justice: A description of Environmental Resources is available in Section 3.3.5 of the Liberty FEIS (https://www.boem.gov/Vol-1-Liberty-FEIS/). Geology, Soils, and Mineral Resources: A description of Oceanography and Geology is available in Sections 3.1.2 and 3.1.3 of the Liberty FEIS (https://www.boem.gov/Vol-1-Liberty-FEIS/). Sociocultural Systems: A description of Sociocultural Systems, including sub-descriptions of Economy, Subsistence Activities and Harvest Patterns, and Community Health are available in the Liberty DEIS in Sections 3.3.1 to 3.3.4 (https://www.boem.gov/Vol-1-Liberty-FEIS/). PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 14 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 5. Final Action and Alternatives 5.1 Alternative 1: No Action Alternative Under this alternative, PHMSA would deny Hilcorp’s request for a special permit for 49 CFR 195.563 and 195.573. Should PHMSA deny the request for a special permit, Hilcorp could construct a sales oil pipeline that complies with 49 CFR Part 195, including a single-walled pipeline with complete coverage of CP. In consideration of this alternative, Hilcorp has identified project advantages and disadvantages: ADVANTAGES of No Action Alternative:  Simplified Installation, Design, Monitoring, and Maintenance – A single-walled design with full CP coverage would not require the additional construction steps such as wrapping a thermal radiation barrier, installing the casing isolators, fabrication of the 16- inch diameter casing piping, inserting the pipeline into the casing, drying, preparing, and sealing the annulus, and installing the additional annulus hardware.  Reduced Project Cost – A 49 CFR Part 195-compliant design could reduce the time and cost for materials, bundle assembly and installation, and potentially reduce the required trench width.2  CP – A single-walled pipeline that fully complies with 49 CFR Part 195 would allow for the use of a conventional, impressed current cathodic protection that could be monitored along its entire length. CP is a simple and reliable way to prevent or significantly reduce external corrosion on a pipeline. The cased pipeline precludes the use of an impressed CP on the 12.75-inch diameter carrier/sales oil pipe, and corrosion control will be provided via a sealed annulus filled with inert gas and a casing pipe to protect the inner pipe. The increased complexity of the project design requires specialized monitoring to ensure proper functionality of the annulus. Further, repair of such a complicated design requires more time in both planning and executing. 2 While PHMSA has not conducted a cost comparison of a PIP design compared to a strain based design, Hilcorp contends that the PIP design is more expensive. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 15 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 DISADVANTAGES of the No Action Alternative:  Increased thermal exposure to the permafrost – The single wall pipeline would not have the benefit of a thermal barrier between the sales oil pipeline and the surrounding environment.  Potential for increased strain due to thermal exposure –Thermal exposure would cause surrounding ice-rich soils to thaw more quickly, ultimately causing settlement of the soil layers, also defined as thaw settlement. The overall thaw settlement potential and thermal exposure to the environment would be much higher than with a PIP design. The increased thaw settlement would potentially cause the pipeline to experience stresses greater than allowable by 49 CFR Part 195. Therefore, the sales oil pipeline would likely require the use of a strain based design without the additional structural support and thermal protection provided by the casing pipe. A strain-based design approach is feasible, but would require greater consideration of interrelated design aspects, including strain demand, design methods, material selection, strain capacity validation, and increase construction and operation requirements. Development of a strain-based design package at this stage would lead to significant project delays, and would frustrate the many government and public stakeholders who have already expressed a clear preference for a PIP design.  Lack of secondary containment – A single wall pipeline system would not have the additional environmental protection provided by a PIP system. While it is possible for both inner and outer pipelines to fail, increased protection to the environment is provided by the extra layer of containment (the casing), external storage, additional coating on the casing, and additional monitoring methods for leaks. The report “An Engineering Assessment of Double Wall Versus Single Wall Designs for Offshore Pipelines in an Arctic Environment” (C-CORE 2000) states “The double wall has an advantage over a single wall pipeline in that it has secondary containment provided by the outer pipe.” 5.2 Alternative 2: Special Permit Action The selected action will require the issuance of a special permit to allow Hilcorp to construct the subsea PIP system without applying CP to the inner sales oil pipeline as required by 49 CFR 195.563(a) and 195.573. Any PIP system could not fully comply with our corrosion control PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 16 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 regulations should a fluid, either seawater or crude oil/water mix, enter the annulus between the carrier pipe and the outer casing pipe. ADVANTAGES of the Special Permit Action: The annulus is intended to provide a thermal barrier between the two pipes, which will operate at different temperatures and provide a dry environment to reduce or prevent the development of corrosion. The two pipes will be in a common trench and welded to two fixed bulkheads (see Figures 4 and 5) on either end of Liberty Pipeline’s crossing of the Beaufort Sea to create a sealed annulus. When functioning correctly, the PIP design and resulting annulus will provide thermal insulative properties that will mitigate frost heave and thaw, foster a non-corrosive environment by preventing electrolyte from getting into the interstitial space, and provide secondary containment of any crude oil released from the carrier pipe. DISADVANTAGES of the Special Permit Action: A 5.68-mile PIP design without CP on the carrier pipe is not addressed in the Federal Pipeline Safety Regulations in 49 CFR Part 195. The special permit conditions are intended to address the potential risks to the design, operation, and maintenance of the Hilcorp Liberty Pipeline, including the extreme temperature differences and differential loads imposed by welding the carrier and casing pipes together at both ends (e.g. 150° F and 25° F, respectively). In general, the lack of CP on the carrier pipe could allow for aggressive corrosion, but the design and special permit conditions are intended to alleviate this risk. Furthermore, construction and repair are more difficult for a PIP design pipeline. Figure 4 – Typical Trench Section – Offshore Zone PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 17 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 Figure 5 – Bulkhead Schematic 6. Comparative Safety and Environmental Impacts of the Final Action and Alternatives 6.1. Safety: Describe existing safety concerns with operation of this pipeline. The special permit is intended to address the following risks to the pipeline:  An ambient temperature of around 25° F on the casing/outer pipe and an internal temperature of 150° F (caused by the temperature of the extracted crude oil) will cause opposing forces on the carrier and casing pipe due to the differing amounts of thermal expansion they will experience. The carrier pipeline will tend to expand more than the casing pipe since it will undergo larger temperature increases following construction and during operation. The effects of these differential temperature-induced forces are compounded by the fact that both pipes are welded to fixed bulkheads, and the carrier pipe will not be able to freely expand. The expanding forces could lead to excessive strains, buckling/denting of the carrier pipe, and/or weakening or failure of circumferential weld seams caused by pulling forces on the casing pipe.  The presence of moisture in an annular space, or the space between the carrier pipe and the casing pipe, can lead to corrosion. Moisture can enter the annular space during the construction process or due to a leak in the casing pipe during operations. Moisture could remain in the annular space if Hilcorp failed to properly dry the annular space along the PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 18 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 5.68-mile pipeline. Because the carrier pipe will not receive CP, corrosion could advance at a rapid rate. Achievement of a negative (-) 10° F dew point prior to start up and the slight vacuum of (-) 10 psig in the annulus is expected to alleviate this risk. 6.2. Plain language summary of each special permit condition and how it will mitigate pipeline risk. The full special permit including conditions, with identical numbering, is posted in the docket in www.regulations.gov using docket number PHMSA-2017-0091. 3 PHMSA proposes that the above-described risks will be mitigated by the special permit conditions. The following bulleted list provides a plain language summary of each condition and how it targets specific integrity risks. 1. Applicable Regulations pipeline. o States that all regulations, except those specifically waived will apply to the 2. Maximum Operating – Pressure, Temperature, Strain and Stress Limits for the Pipeline o Limits strains, temperature and pressure that can damage and cause wear to the steel pipeline. This condition specifies the design and operating parameters upon which the special permit conditions are predicated. o Due to the significant strains imposed on the pipeline due to environmental conditions and design, the strain parameters will be imposed to limit the strain that can lead to integrity threats and the longevity of the pipeline. 3. Integrity Management Program o Hilcorp will be required to treat the pipe in pipe segment as a high consequence area, meaning that the safety requirements in 49 CFR 195.452 apply. 4. Design, Specifications and Procedures o Hilcorp will be required to develop and implement written procedures for the material, design, construction, operations and maintenance of the pipeline. 3 In the event of any discrepancy between this summary and the conditions as written in the special permit, the special permit is controlling. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 19 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 o These conditions are intended to prevent situations that could lead to unintended stresses, strains, or creation of defects to or on the pipeline. 5. Pipe – Carrier o The permit will require the carrier pipe be 12.75-inch diameter and have 0.500- inch wall thickness. o Includes specifications to ensure proper pipe manufacturing processes and mill testing, required strength, diameter, toughness, and thickness. o These requirements will protect the pipeline against, strains, corrosion, and cracking. The mill tests seek to identify metal defects that could threaten integrity throughout the life of the pipeline. 6. Carrier Pipe Toughness o Requires the use of Charpy-V-Notch (CVN) impact tested in accordance with API 5L – Specification for Line Pipe, which ensures a high level of metal toughness. o Toughness in metal is the ability to absorb energy and plastically deform without fracturing. This quality helps protect against pipeline failure. 7. Carrier Pipeline Design Factor o The pipeline design factor is a maximum of 0.72. The bulkhead fitting and tie-in piping (two (2) pipe joints on each side of bulkhead for the 12.75-inch diameter carrier pipe) must have a maximum design factor of 0.60. o These design factors ensure that the pipeline facility is designed to handle a greater level of pressure and strain than actually anticipated on the pipeline. 8. Bends o No manufactured hot bends or field cold bends are allowed for the subsea cased pipeline, and segments from buried to above ground at the shore must gradually sweep to shore. Directional changes in the pipeline must maintain specific stress levels below industry standards. o Excessive forces can collect at manufactured or field bends, thereby causing damage (e.g. cracking). This requirement reduces the risk of failure along bends in the pipeline. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 20 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 9. Flanges and Fittings o Flanges and fittings must comply with specific industry standards so that they have sufficient strength to withstand the design and operating parameters. 10. CP – Carrier and Casing Pipe o The casing pipe will be cathodically protected in compliance with 49 CFR 195.563. CP is an electric current applied to a pipeline to prevent corrosion. CP slows or prevents corrosion from occurring in areas where the coating has become disbonded or been removed from the pipe. o The special permit will require a fusion bonded epoxy coating on the casing pipe external surface. This coating type should prevent corrosion (where it is not damaged) and will not shield the CP from the pipe, which could allow for aggressive corrosion. It is not possible to apply CP to the carrier/inner pipe as required by the Federal Pipeline Safety Regulations, which is the reason Hilcorp requested the special permit from PHMSA. o The 16-inch diameter casing pipe must be internally coated with the exception of a short segment (less than 4-inches wide) at pipe girth welds. This requirement is a contingency to the possible loss of a dry, inert annulus environment and the creation of a potentially corrosive environment between the 12.75-inch carrier and 16-inch casing (internal portion of the casing). The internal casing pipe coating will help to keep internal steel mill scale and corrosion pitting from occurring after pipe manufacturing and during the transportation, storage, construction and commissioning stages of the pipeline. Since the 12.75-inch carrier pipe is being inserted into the 16-inch casing pipe, it is impracticable to coat the 4-inch wide area at girth welds inside the 16-inch casing due to clearance space issues between the casing and carrier pipes. 11. PIP Design o In the event of a failure of a pipeline that fully complied with the 49 CFR Part 195, a pipeline failure will result in a release of the contents of the pipeline into the environment at a high pressure. Hilcorp is requesting to use a pipe in pipe design so that, in the event of a failure of the carrier pipe, the casing pipe will PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 21 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 contain the crude oil that would otherwise be released into the Beaufort Sea. To ensure the functionality of this design Hilcorp will be required to:  Fill the sealed space between the carrier/inner pipe and the casing/outer pipe, known as the “annulus” or “annular space” with an inert gas such as Nitrogen or Argon. Unlike ambient air, which includes oxygen, this inert gas will not react with the pipeline metal to cause corrosion.  Maintain the pressure of the inert gas in the annulus at -10 psig, which is a slight vacuum through connection to a vacuum system.  Monitor the pressure of the annulus. In the event of an increase in pressure, it may signal a breach of the carrier pipe, in which case the annulus could fill with crude oil. An increase in pressure may also signal a breach in the casing pipe, in which case the annulus could fill with sea water.  Maintain dew point and monitor the temperature of the annular space. A dew point at or below -10° F to prevent liquid drop out, in the event that any water vapor remains within the inert gas. Water condensation in the annulus could cause external corrosion to the carrier and casing pipe. In the event of an increase in pressure in the annulus, temperature monitoring showing a low temperature could indicate the presence of sea water, and a high temperature could indicate the presence of crude oil. 12. PIP Bulkhead Design o The special permit will include requirements for the bulkhead fittings to meet the regulations, standards and undergo tests to ensure that they can maintain the high stresses that they will be subject to due to the opposite forces applied by the two pipes. 13. Bundle and Fiber Optic Cable o The bundle will include the PIP system, fiber optic cable, spacers, a utility line, and bundle straps. o The fiber optic cable will be located outside the PIP system and will monitor temperature along the length of the PIP system. It will have the ability to communicate temperature data to the SCADA system. An increase in PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 22 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 temperature as recorded by the fiber optic cable could indicate a release of the heated crude oil. o This condition will allow prompt notification of temperature change allowing proper emergency actions. o The bundle must be at least seven feet below the subsea mudline to protect against currents and external forces. 14. Pipe-External Coating o The special permit will include requirements to ensure the proper application, thickness, and repair of the fusion bonded epoxy coating to the pipe. A properly applied coating provides protection against external corrosion without shielding CP. 15. Monitoring System o The special permit will require that the pipeline is monitored at all times for pressure, temperature, and flow rate. Changes in any of these values could indicate a failure of the pipeline or an emergency situation. o The special permit conditions specify the placement of remote closure valves, pressure and temperature transmitters, and flow meters. 16. Casing Pipe- Design and Operating Properties o The special permit will require that the outer casing pipe meet specific design specifications and undergo certain tests to ensure strength and toughness of the pipe metal. o The special permit will set specific parameters for normal operating pressure, design pressure, maximum operating pressure, temperature, maximum allowable combined stress, and annulus relief valve pressure. o Operating within these parameters will protect the pipe metal from additional fatigue and stresses that could threaten the integrity. 17. Construction Quality Control o The special permit will require that Hilcorp develop and implement a right of way construction monitoring program for procedures, specifications, and training personnel in all aspects of pipeline construction, including:  pipe inspection, PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 23 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091  hauling and stringing pipe,  welding,  non-destructive examination of girth welds,  applying and testing field applied coating,  lowering the pipeline into the subsea trench,  backfilling, and  hydrostatic testing including dewatering and drying. o The special permit will require that Hilcorp develop a Subsea Trench Quality Control Plan and Procedures, which will require:  chemical testing of trench soils to predict corrosion risks,  trench depth monitoring,  trench bottom roughness profiling,  backfilling requirements, and  use of pipe end protection caps to keep out water during construction. o Coating application quality control specifications for external coatings of both casing and carrier pipe must be developed, implemented, and personnel must be trained to ensure the carrier and casing pipe surface cleanliness, application temperature control, adhesion quality, cathodic disbondment, moisture permeation, bending, and minimum coating thickness for girth weld and repair coatings meet the procedure requirements. Both the carrier and casing pipe must be externally coated for corrosion protection. 18. Carrier Pipeline Girth Welds o The special permit will include requirements for welding procedures and welder tests. If a carrier girth weld test reveals a crack in the weld, the cracked weld must be cut out. o Over the life of a pipeline, defects in welds resulting from improper procedures can develop into threats to the pipeline integrity, especially for pipelines with higher levels of stress. o The carrier pipe and coating must be protected from weld splatter. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 24 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 19. Casing Pipe Girth Welds o The special permit will include requirements for welding procedures weld tests. If a casing girth weld test reveals a crack in the weld, the crack must be cut out. o Over the life of a pipeline, defects in welds resulting from improper procedures can develop into threats to the pipeline integrity, especially for pipelines with higher levels of stress. 20. Casing Isolators o Casing isolators provide support and prevent contact between the carrier and casing pipe. o The special permit will require a maximum casing isolator spacing of 10 feet consistent with manufacturer specifications. o The special permit will require the casing isolators to withstand anticipated pipeline loads, deflection, and movement in order to maintain continuous separation between the carrier and casing pipe. 21. Relief Storage Tank o The special permit will require that a pressure increase in the annulus, caused by the annulus filling with oil or seawater to activate a relief valve and discharge the fluid to a relief storage tank or vessel of adequate capacity. o In the event of a failure to the carrier pipe, the pressure would rapidly increase in the annulus. This could cause an overpressure situation in the annulus, and a defect in the unpiggable casing could lead to failure, which would lead to oil discharging into the Beaufort Sea. 22. Operations & Maintenance (O&M) Procedures o The special permit will require that Hilcorp have O&M procedures for operating personnel to ensure proper operation of the CP system, the monitoring of the annulus, implementation of integrity management, and other operating parameters such as monitoring pressure and temperature. o Rigorous and detailed O&M procedures are intended to reduce the risk of oversight or human error in the operation of the pipeline that could lead to the creation or growth of damage, corrosion, or strain to the pipeline. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 25 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 23. Monitoring and Determination of Pipeline Strains o The special permit will require that if specific locations of the pipeline experience high levels of strain, as detected through ILI tools or otherwise, strain demand monitoring processes or devices will be installed or implemented. If high strain is identified, the special permit will require procedures to monitor, evaluate, model, and mitigate strain. o This monitoring will be intended to prevent the development and growth of anomalies on the pipeline, such as bending, denting, buckling, crumpling, cracking or corrosion that can directly or indirectly result from strain accumulating in vulnerable areas of the pipe. 24. Integrity Assessments o The special permit will require Hilcorp to perform pipeline assessments using the prescribed ILI tools at the following intervals:  Before Pipeline Startup:  high resolution (HR) deformation tool,  multi-dimensional geospatial mapping tool, and  remediate anomalies; all dents treated as “top side” dents.  Baseline Assessment- within 15 months of startup, run following tools:  HR metal loss,  HR deformation, and  multi-dimensional geospatial mapping.  Second Assessment- within 39 months of startup, run following tools:  ultrasonic technology (UT) for metal loss and cracking,  HR deformation, and  multi-dimensional geospatial mapping.  Periodic Assessments- every 2 to3 years based on existing integrity data:  HR metal loss,  HR deformation,  multi-dimensional geospatial mapping, and  UT for metal loss and cracking every other assessment. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 26 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 o The special permit will require that Hilcorp install a calibration spool with the same PIP design with certain installed defects to test ILI tool accuracy because calibration digs are not feasible in the subsea environment. o If tool data reveals contact between the carrier and casing pipe, Hilcorp must run HR deformation and Multi-dimensional geospatial pipeline mapping tools, assess the tool data, and remediate as required by 49 CFR Part 195. o These conditions require Hilcorp to run specific ILI tools more often than required by 49 CFR Part 195 to more quickly identify and respond to integrity risks posed by the forces imposed on the carrier and casing pipe. These additional forces can lead to the creation and growth of anomalies, which can cause carrier or casing failure. The tool runs will detect the presence and characteristics of anomalies, allowing the operator to remediate or monitor the anomalies, as required. 25. Analysis of ILI Tool Data and Discovery of Actionable Anomalies o The special permit will require Hilcorp to factor in ILI tool accuracy and applicable anomaly growth rates when analyzing ILI tool data. o The purpose of this condition will be to reduce risk posed by anomalies by attempting to ensure rigorous and accurate characterization of anomalies so that they are remediated in an appropriate time frame, that also meets permitting and scheduling requirements to minimize environmental disturbance, so that they are not able to threaten pipeline integrity. 26. Engineering Critical Assessment for Cracks o The special permit will require that Hilcorp perform an Engineering Critical Assessment for any crack 50% or less of wall thickness in the inner carrier pipe. Any crack greater than 50% wall thickness or of a certain failure ratio will be treated as an immediate response. o The purpose of this condition is to remediate cracks of a lesser depth than required by 49 CFR Part 195 due to the risks from strain. 27. Leak Detection System o This special permit will require:  a mass balance system with flow meters at pipeline intersection points, PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 27 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091  a PIP annulus monitoring system for pressure and temperature, and  a fiber optic cable with temperature monitoring. o These conditions are intended to ensure that changes to the annulus and external temperature that could indicate a failure of either the carrier pipe or casing pipe are quickly identified so that Hilcorp can take proper remediation/response actions. 28. Monitoring Systems – Carrier Casing Pipe and PIP Annulus o This condition will require monitoring for changes in: pressure, temperature, settlement, flow, and dew point. o These conditions are intended to ensure that changes to the carrier, casing, and annulus that could indicate a failure of either the carrier pipe or casing pipe are quickly identified so that Hilcorp can take proper remediation/response actions. 29. Monitored Response Procedures o This condition will require that if the carrier pipe temperature exceeds the maximum design temperature of 150° F, Hilcorp must reduce the operating temperature within two (2) hours. If the temperature exceeds 150° F for more than 24 hours, Hilcorp must notify PHMSA. o This condition will also require monitoring and notification to PHMSA for specific temperature changes to the soil surrounding the bundle. o These conditions protect against excessive heat that can damage the pipeline and require monitoring for temperature changes that can indicate a failure has occurred. 30. CP System Monitoring of the Casing Pipe o This condition will require that the casing pipe is cathodically protected within six (6) months of placing the subsea segment into service. The inner carrier pipe cannot be cathodically protected, which is the reason that Hilcorp submitted the special permit request. o Hilcorp will have to install test leads and perform close interval surveys 1 year after construction and then every five (5) years. If more than 20% of test leads fail, the close interval frequency will change to every three years. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 28 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 o This condition contains specifications about the CP monitoring system and procedures. CP potential readings will be taken yearly and in accordance with specifications in the special permit. o These conditions are intended to ensure consistent CP on the casing pipe. When properly maintained, CP provides strong protection against corrosion. The tests are intended to find any gaps in protection. 31. SCADA and CPM Systems o The supervisory control and data acquisition (SCADA) and computational pipeline monitoring (CPM) leak detection systems will be required to comply with 49 CFR 195.444 and 195.446. 32. Data Integration o This special permit condition requires Hilcorp to conduct, maintain, and annually update data integration for all special permit findings and remediation. PHMSA may request this data starting with the 2nd annual report. o These conditions are intended to ensure that Hilcorp properly integrates data to view its system holistically, to better identify and remediate pipeline safety threats. 33. Environmental Assessments and Permits o The special permit requires Hilcorp to evaluate environmental consequences of land disturbances or water crossings needed to implement the special permit conditions. Hilcorp must comply with all local, state, and federal environmental permits in this process. 34. Notices to PHMSA o This special permit condition requires Hilcorp to provide various notifications to PHMSA during the design and construction and within 2 business days of discovery of an immediate repair condition to ensure close oversight. o This condition allows PHMSA to proactively identify issues. 35. Annual Report o This special permit condition requires Hilcorp to prepare and submit an annual report to PHMSA and the public that includes the following information:  any integrity threats identified by ILI tools, PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 29 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091  all reportable incidents,  all repairs,  any ongoing damage prevention, corrosion, and longitudinal strain preventative initiatives and a discussion of the success of the initiatives,  data integration information, including irregular changes in pressure, temperature, and dew point where the pipeline exceeded operational parameters, and  corporate changes affecting regulatory responsibilities. o This condition allows PHMSA and the public to have a strong understanding about the integrity threats and maintenance of the pipeline to ensure compliance and sound decision-making. 36. Documentation o This special permit condition requires Hilcorp to maintain and provide the following upon request:  records required by 49 CFR Part 195 and 8-hour hydrostatic test at 1.25 times maximum operating pressure, and  steel mill test reports showing wall thickness, yield strength, tensile strength, and chemical composition. This must be maintained for the life of this special permit. o This condition requires the maintenance of records that are critical to understanding potential integrity risks both in the short term and long term life of the pipeline. 37. Certification o A Hilcorp senior executive officer, vice president or higher, must certify:  The pipeline meets the special permit conditions.  The O&M manual has been updated to include all additional operation and maintenance requirements of the special permit.  Documentation requirements are complete.  All certification requirements in the special permit are complete. o This condition requires the involvement and oversight of a Hilcorp senior executive officer to better ensure compliance, communication, and awareness. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 30 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 6.3. Operational Safety: Describe existing safety concerns with operation of this pipeline. 6.3.1 Would operation under a special permit change the risk of leak, rupture or failure? Although the inner pipeline will not receive CP as required by Code, PHMSA finds that the design, construction, and operation of the carrier pipeline, when in full compliance with the conditions described in the special permit, will meet or exceed the level of safety that a pipeline operating in full compliance would achieve. The casing protects the carrier/inner pipeline from exposure to an electrolyte, therefore reducing the risk of pipeline wall thinning due to corrosion. The casing also protects the sales oil pipeline from external force damage. The casing will also be connected to a relief storage containment, which could contain crude oil leakage from the carrier pipe, in the event of an increase in pressure and failure of the casing pipe. The casing pipe and the annulus further provides a thermal barrier between the sales oil pipeline and the surrounding environment, which will reduce the potential thaw settlement, which in turn will reduce the calculated pipe stresses. 6.3.2 If a leak, rupture, or failure occurred, would consequences and spill or release volumes be different if PHMSA granted the special permit? Would granting this special permit increase, decrease, or have no change on the risk of failure? Any potential spill or release volumes will be reduced or eliminated using the PIP design, with relief storage containment connection. Increased pressure in the outer casing pipe would trigger the opening of a relief valve leading to a storage containment for any leaks, reducing the likelihood of a leak to the environment. The opening of the relief valve leading to storage containment will also cause the pipeline to shutdown. The PIP design, continuous monitoring, and SCADA system improve Hilcorp’s ability to detect leaks on the sales oil pipeline. The risk of leak, rupture or failure will decrease under the selected alternative. Under the no action alternative, the pipeline would be required to be completely covered by CP to mitigate corrosion. Leak detection requirements under 49 CFR Part 195 would apply, but there would be no secondary containment. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 31 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 6.3.3 Would operation under the special permit have an effect on pipeline longevity or reliability? Would there be any life cycle, maintenance, or issues? Operating under the special permit will not have significant impact on pipeline longevity or reliability due to additional design, materials, and operations and maintenance requirements for the system specified in the special permit. In particular, more rigorous monitoring of the pipeline and associated equipment will be conducted during the life of the project. Under the no action alternative, which would be a single, cathodically protected pipe, the temperature of the pipeline could lead to more rapid melting of permafrost soils, which could impose greater stresses and strains on the pipeline from settlement. 6.4 Water Resources: Would this special permit impact drinking water resources or result in any changes to the risk level of drinking water? The requested special permit will not impact any drinking water resources. 6.4.1 Would this special permit affect any wetlands or surface waters during construction or operation? How? The requested special permit will not change any effects to wetlands or surface waters during construction, in comparison with the no action alternative. Given the special permit conditions, PHMSA believes that the requested special permit will reduce the risk of release to the environment during operation, therefore reducing the risk of impacts to wetlands and surface waters from a spill. PHMSA is not aware of any increased impacts to wetlands or surface waters that could result from the PIP design, rather than a single walled design under the no-action alternative. 6.4.2 What measures would be taken to minimize impacts? Operation under a special permit will not result in increased impacts during construction as compared to construction under the no action alternative. Discussions of project impacts, generally, are addressed in the FEIS. 4 The special permit conditions are intended to impose an equivalent level of pipeline safety as full compliance with the PHMSA Code. The special permit 4 The BOEM’s FEIS and other relevant documents including the published Notice of Availability can be reviewed in the Federal Register for the FEIS for the construction of Liberty Drilling and Production Island and the siting of the Liberty Pipeline. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 32 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 conditions will allow for more rapid detection of anomalies so they could be remediated at a time to minimize environmental damage. Detailed mitigation measures are addressed above in Section 6.2 and provided in full detail in the Special Permit Conditions. 6.4.3 Would this special permit require the issuance of any local, state, or federal permits regarding water, such as a § 404 permit from the Army Corps of Engineers? No, this special permit will utilize a PIP design without CP on the carrier pipe and will not require the issuance of any other local, state, or federal permits than will be issued otherwise. However, the overall Liberty Development & Production Plan will require permitting and approval from various federal agencies, including the Department of the Interior, which is the lead federal permitting agency. The project will also require various State of Alaska permits, including the right -of-way approval. 6.5 Aesthetics: Would this special permit request change the visual character of the special permit segment? The special permit will not impact the visual character of the Liberty Pipeline system as compared to operation without a special permit. On Liberty Island, Hilcorp will be required to designate tankage for secondary containment in the event of failure of the carrier pipe. Hilcorp already intended to utilize breakout or storage tanks on Liberty Island, but this condition could add a breakout tank or other storage vessel. This is not considered to be a significant addition in the scope of the project. 6.6. Agricultural Resources: Would this special permit impact any agricultural resources? The requested special permit will not impact any agricultural resources. 6.7. Climate Change and Air Quality: Would this special permit increase or decrease the release of greenhouse gases or other pollutants? Please specify which gases. Would this special permit require the applicant to request any air quality permits? The requested special permit involves a more complex pipeline facility, including the PIP design, and relief containment. The special permit will also result in more complex operations and maintenance. These realities could lead to moderate increases in the release of certain air PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 33 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 pollutants and greenhouse gases during construction and operations, in comparison to the no action alternative. However, these design and operations conditions are intended to reduce the risk of release to the surrounding environment, which could have greater environmental impacts and lead to the emission of air pollutants from a crude oil release and resulting response efforts, depending on severity. The requested special permit will not result in any additional air permitting requirements, as compared to operation without a special permit. 6.8. Biological and Cultural Resources: Would ground or sea floor disturbance occur as a result of this special permit? What cultural, biological, and habitat resources are impacted? The requested special permit could result in a minimal increase in sea floor disturbance during repair of the pipeline. PHMSA believes that the methodology of repair might differ in some cases based on the PIP design because Hilcorp may not be able to use divers to complete repairs for the PIP design. However, the use of divers to conduct repairs would likely not be effective in any event due to low visibility in the relatively shallow waters in this area. PHMSA believes and Hilcorp has indicated that Hilcorp would use a cofferdam to conduct pipeline repairs. If the pipeline were single-walled, Hilcorp would likely use a cofferdam or pull the pipeline up above the water surface onto a barge or surface ice for repairs. Due to the extra digging needed to pull up a line to the service for a surface repair, PHMSA believes that a cofferdam would actually result in lesser or equivalent environmental impacts. On the other hand, the PIP design will require more time to complete a repair than a single- walled pipe. This longer repair duration for this action as compared to the no-action could result in slightly greater impacts to the wildlife, in the event that a repair is needed. This difference will increase the duration of noise, sedimentation in the water column, and direct disturbance to organisms living on the sea floor such as polychaetes, bryozoans, crustaceans and mollusks and sea life higher in the food chain that depend on those organisms. However, overall, PHMSA proposes that the selection of the final action alternative will result in lesser risk to the environment due to 1) the lower risk of a release of oil into the environment, and 2) more timely identification of integrity threats so repairs could be scheduled to minimize sea floor disturbance. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 34 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 6.9. Socioeconomics: Would this special permit result in any disparate impacts to rural, low-income, or minority populations? The requested special permit will not result in any increased impacts to rural, low-income, or minority populations, as compared to operation without a special permit. The PIP design and the special permit conditions are intended to reduce the risk of release, which could negatively impact Alaskan villages in the area, which engage in subsistence activities including fishing and whaling. 6.10. Transportation: How would the special permit areas be accessed? Would the special permit result in an increase in traffic or require additional roads to be constructed or more frequently maintained? No permanent access is available to the project area. The area covered by the special permit will be accessed via ice roads, marine access, or helicopter. The requested special permit will not result in an increase in land based traffic that would require additional roads to be constructed, as compared to operation under the no action alternative. 6.11. Land Use: Would land use or recreation areas be impacted by the special permit? The requested special permit will not impact land use in the project area, as compared to operation without a special permit, due to its remote location. 6.12. Native Americans: Does this project impact a federally-recognized Tribal Reservation? Has tribal consultation taken place? With the exception of the Metlakatla Indian Community in Southeast Alaska, there are no Tribal Reservations within Alaska. The Liberty Pipeline is not located near the Metlakatla Indian Community. The Liberty Pipeline has the potential to impact the communities of Utqiagvik (Barrow), Nuiqsut, and Kaktovik which are inhabited by a majority of Iñupiat Alaska Natives. Hilcorp has met with community members and leadership to obtain feedback about the Liberty Development project. The special permit will not result in increased impacts to Alaskan Natives, as compared to the no action alternative. PHMSA has contacted Iñupiat Alaskan Native villages in the area to provide PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 35 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 them with information about the special permit and welcome their comments. BOEM, the lead agency for the Liberty Project, has engaged in consultation with these villages. 6.13. Pipeline Failure Mitigation: Explain how or whether a pipeline failure would differ under the selected special permit with Hilcorp’s preventative and mitigative measures? PHMSA proposes that the likelihood of a pipeline failure will be reduced under the special permit using a PIP design with the special permit conditions. Under the no action alternative, a failure of the pipeline would result in the discharge of crude oil directly in the Beaufort Sea. Under this special permit with conditions, a build-up of pressure in the PIP annulus following a failure of the carrier pipe will open a valve to allow the leaked crude oil to flow from the annulus into attached storage with capacity based on oil flow and shut down time. Continuous pressure and temperature monitoring will also alert Hilcorp of a failure either the inner/carrier pipe or the outer/casing pipe. 6.14. Human Safety: How would human safety be impacted? PHMSA believes that issuance of and compliance with the special permit will decrease likelihood of a spill, as compared to an operation without a special permit. In the event of a failure of the Liberty Pipeline, it is unlikely anyone would be in the vicinity of the pipeline at the time of failure. Nonetheless, subsistence resources could be impacted by a release. PHMSA believes that the design, construction, operation, and maintenance of the pipeline in full compliance with the special permit will decrease the likelihood of a pipeline failure. 6.15. Natural Environment: How would the natural environment be impacted? PHMSA believes that issuance of and compliance with the special permit will decrease the likelihood of a spill and associated environmental impacts, as compared to an operation without a special permit. 7. Consultation and Coordination 7.1. Please list the name, title and company of any person involved in the preparation of this document. o PHMSA  Amelia Samaras, Attorney PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 36 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091  Steve Nanney, Engineer  Chris Hoidal, Engineer  Joshua Johnson, Engineer o Hilcorp Alaska, LLC – (Operator of Liberty Pipeline)  Kate Kaufman, Lead Permit Specialist  Jennifer Gardner, Pipeline Project Engineer  Mike Dunn, Liberty Project Manager  Ben Wasson, Integrity Management Engineer  Erin McKay, Regulatory Compliance Manager  Michael Baker International – Paul Carson, Technical Manager & Chief Engineer  SLR International Corporation – Michelle Turner, Principle Scientist 8. Response to Public Comments Placed on Docket PHMSA-2017-0091 PHMSA published the special permit request in the Federal Register (83 FR 52050) on August October 15, 2018, and the public comment period ended on November 14, 2018, with all comments received through November 14, 2018 being reviewed and considered. The special permit application from Hilcorp, pipeline route maps, public comments, environmental assessment, and special permit conditions are available in Docket No. PHMSA-2017-0091 at: www.regulations.gov. The BOEM’s FEIS and other relevant documents including the published Notice of Availability can be reviewed in the Federal Register for the Final Environmental Impact Statement (FEIS) for the construction of Liberty Drilling and Production Island and the siting of the Liberty Pipeline. PHMSA received comments from four (4) stakeholders on the Liberty Pipeline special permit. The comments received were for denial of the special permit request. A summary of stakeholder posted comments are:  Stakeholder Comments Requesting PHMSA to Deny the Special Permit: 4 o Private Citizens – 2 o The Wilderness Society (TWS) – 1 o Center for Biological Diversity - 1  Stakeholder Comments in support of Special Permit: 0 PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 37 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 PHMSA’s summarization of the public stakeholder comments and how the concerns are being handled within the special permit are below: 1) Stakeholder Comment: CP requirements prevent both internal as well as external corrosion. Note that Hilcorp’s application only focuses on external corrosion. TWS believes that the CP system is needed to prevent internal corrosion on this pipeline which will be carrying warm – up to 150 °F. – crude oil. While it is true that the outer pipeline may prevent oil from entering the offshore environment if there is a release from the inner pipeline, there still will be adverse construction and remediation-related impacts resulting from that release.  PHMSA Response: Buried pipelines utilize CP - either using an impressed current or a galvanic anode system - to reduce external corrosion of the pipe metal. Internal corrosion most commonly occurs due to corrosive mixtures of water and certain gases like carbon dioxide (CO2) or hydrogen sulfide (H2S) in the transported fluid. Microbial influenced or induced corrosion can also result in accelerated deterioration of the pipe initiated by different microbial activities present in oil and gas systems. PHMSA regulations in 49 CFR 195.579 require operators to investigate and determine whether the fluid stream in the carrier pipe is corrosive and take adequate steps to mitigate internal corrosion. These mitigation measure include the introduction of corrosion inhibitors, eliminating the corrosive fluid stream, and monitoring the effectiveness of the inhibitors via coupons (pieces of steel pipe that are inserted into the pipeline and routinely measured for metal loss). The ILI devices mandated in the special permit conditions for the Liberty Pipeline will allow for the routine identification and measurement of any internal corrosion to confirm the internal corrosion methods being used by Hilcorp are effective. While there should not be a corrosive environment in the Liberty Pipeline PIP annulus since Hilcorp is being mandated to keep it continuously dry, if water or other corrosive fluids were to enter the annulus, the casing could experience internal corrosion. For that reason, we are revising our special conditions to require Hilcorp to coat the inside of the casing pipe with a corrosion resistant material. The 12.75-inch diameter carrier pipe will have an external corrosion coating. These steps should minimize any release PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 38 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 from either the carrier pipe or the secondary containment provided by the casing pipe. See Special Permit Condition 10(d) for requirements for coating the internal and external surfaces of the 16-inch diameter casing pipe. 2) Stakeholder Comment: In order to create an inert environment between the two pipes, Hilcorp proposes to seal the ends of the inner and outer pipelines. Because this approach will create additional pipeline stresses and is contrary to the design used in two similar projects, Oooguruk and Nikaitchuk pipelines, TWS questions why Hilcorp has chosen to use this problematic design. Also, as noted in the Draft Environmental Assessment (EA) developed for this Special Permit the [PIP] design would require more time to complete a repair than a single walled pipe. This longer repair duration for the proposed action as compared to the no-action could result in slightly greater impacts to the wildlife, in the event that a repair is needed. This difference would increase the duration of noise, sedimentation in the water column, and direct disturbance to organisms living on the sea floor such as polychaetes, bryozoans, crustaceans and mollusks and sea life higher in the food chain that depend on those organisms.  PHMSA Response: The Liberty pipeline design appears to be using a similar design as the Oooguruk and Nikatichuq pipelines. PHMSA does not regulate the crude oil carrier pipe or casing for either of these pipeline systems. PHMSA recognizes that a PIP design has certain merits, particularly if the carrier pipe fails and the casing can contain the oil so it does not enter the sensitive Beaufort Sea. If product leakage should happen, the corrosion control systems for the carrier pipe would neither be effective nor could it be monitored. Additionally, the carrier pipe and casing pipe are expected to expand at different rates causing potentially large loads on the pipes and PIP seals (bulkheads) at the ends of the PIP section. PHMSA does not know if similar loads may be occurring on the Ooguruk and Nikaitchuq pipelines, but the Special Permit Conditions will allow for the monitoring of any excessive deformation that could threaten the integrity of the carrier pipe or casing pipe. We concur that if a repair was needed that it may take longer to construct a safe working environment and minimize environmental damage. For that reason, in response to public comment, PHMSA PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 39 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 has modified the special permit conditions to require identification of integrity threats at lower corrosion and deformation levels in order to schedule the repairs when the least environmental damage is done (if there should be an integrity threat). (See Special Permit Condition 24(h) for anomaly repair safety factors that will require repairs and schedules that will be faster than normal 49 CFR Part 195 requirements.) 3) Stakeholder Comment: The Draft EA developed for this Special Permit has several deficiencies that must be addressed in the Final EA.  First and most importantly, the no action alternative utilized for comparison is not appropriate as it assumes a single-wall pipeline in compliance with PHMSA’s CP regulations and not a PIP design in compliance with the regulations. As a result, the Draft EA must be redone comparing the Special Permit to a PIP design with CP, and that redone Draft EA should be made available for public comment.  Notably, the two most recent offshore Arctic pipelines constructed were both PIP configurations as those designs represent best practices.  PHMSA Response: PHMSA does not regulate the two cited PIP crude oil lines (Ooguruk and Nikaitchuq) in the Beaufort Sea. The Liberty Pipeline offshore design approach will be the fourth subsea pipeline installed in the Alaskan Beaufort Sea (Northstar, Oooguruk, and Nikaitchuq). The Liberty Pipeline will be the 3rd pipeline in the Beaufort Sea that utilizes a PIP design for the crude oil carrier pipe, however the other two (Oooguruk and Nikaitchuq) are not regulated by PHMSA since they are carrying non processed crude oil and were deemed to be a production flowline outside of our jurisdiction. Northstar is regulated by PHMSA since the crude oil is processed prior to transportation and uses a conventional single wall pipe design compliant with existing Federal Pipeline Safety Regulations. PHMSA regulates the safety of crude oil pipelines through 49 CFR Part 195. We do not know whether the two pipeline systems meet Federal Pipeline Safety Regulatory requirements. They probably would not meet the CP requirements for the carrier and casing pipelines. We did not consider a PIP alternative to have adequate CP since CP cannot be provided nor monitored PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 40 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 for the sealed inner carrier pipe. PHMSA special permit conditions will mandate more extensive protection through monitoring and maintenance of the annulus and more frequent assessments than the existing Federal Pipeline Safety Regulations to ensure that corrosion is not occurring. PHMSA does want to encourage PIP design in limited instances, e.g. where the environment is very sensitive, but PHMSA wants to ensure that no unintended safety consequences are introduced and that the pipeline stays in compliance with existing safety regulations. (See Special Permit Condition 24(b) through (d) for ILI integrity assessment criteria, which requires short assessment intervals than 49 CFR 195.452.) 4) Stakeholder Comment: The Draft EA fails to specify the threatened and endangered species present in the area, though it does reference the BOEM’s full Environmental Impact Statement. Notably, there are many such species present in that area including several species of birds: spectacled eiders and Steller’s eiders (pages 3-36); and of marine mammals: bowhead, fin, humpback, and right whales; bearded seals, Steller sea lions, sea otters, and polar bears (pages 3-49). Specifying these species allows for improved public comments and awareness of the potential impacts of the project, and should be included in the Final EA.  PHMSA Response: The commenter is correct that various protected species utilize and inhabit the area of the Liberty Pipeline. The lead agency BOEM has authority to approve siting and construction of the Liberty Development Project, including the Liberty Pipeline. PHMSA has no authority over pipeline siting, and the “no action” alternative that PHMSA is required to consider is a pipeline that fully complies with the minimum standards in 49 CFR Part 195. BOEM initiated formal consultation under the Endangered Species Act with the National Marine Fisheries Service (NMFS) (NMFS Consultation Number: AKR-2018-9747). In July 2018, NMFS issued a Biological Opinion for the Project, which includes an Incidental Take Statement along with Reasonable and Prudent Measures, Terms and Conditions, and Conservation Recommendations. That document is available on the NMFS website: PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 41 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 https://alaskafisheries.noaa.gov/sites/default/files/biological-opinion-liberty- beaufort073118.pdf. BOEM announced the availability of the Record of Decision for the FEIS for the Liberty DPP in the Beaufort Sea Planning Area in the Federal Register (83 FR 54136) on October 26, 2018, at https://www.federalregister.gov/documents/2018/10/26/2018- 23366/environmental-impact-statement-on-the-liberty-development-and- production-plan-in-the-beaufort-sea. 5) Stakeholder Comment: PHMSA’s Draft EA defines the purpose and need of the proposed action as to require the issuance of a special permit to allow Hilcorp to construct the subsea [PIP] system without applying [CP] to the inner sales oil pipeline as required by 49 CFR 195.563 and 195.573. This purpose and need is entirely inadequate because PHMSA necessarily considered an unreasonably narrow range of reasonable alternatives. PHMSA has a duty to protect the public and the environment from the dangers of transporting oil by pipeline. Specifically, the Pipeline Safety, Regulatory Certainty and Job Creation Act (PSA), 49 U.S.C. 60101, et seq., seeks to “provide adequate protection against risks to life and property posed by pipeline transportation and pipeline facilities by improving the regulatory and enforcement authority of [PHMSA] Id. § 60102. Accordingly, PHMSA should have focused its purpose and need inquiry on objectives that comport with these statutory duties, rather than on appeasing the desires of the applicant.  PHMSA Response: Special permits are allowed through 49 U.S.C. 60118(c) – Compliance and Waivers - which gives PHMSA the authority to grant a special permit, if PHMSA determines that the waiver is not inconsistent with pipeline safety. A special permit is an order by which PHMSA may grant to waive one or more of the Federal Pipeline Safety Regulations and is codified in 49 CFR 190.341. Hilcorp filed for a special permit in accordance with 49 CFR 190.341 and has provided the relevant documents for this special permit request. The Liberty Pipeline special permit request is to waive the CP criteria in 49 CFR 195.563 and 195.573 for the 12.75-inch diameter carrier pipeline being installed PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 42 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 within a 16-inch diameter casing pipe (PIP design). The environmental assessment included two alternatives that compared the design, operations and maintenance of a PIP design (Alternative 2: Proposed Action) to a single wall pipeline without a casing (Alternative 1: No Action Alternative). The 16-inch diameter casing pipe will have CP. The 12.75-inch diameter carrier pipe for the crude oil will not have CP due to it being installed inside a casing pipe, which will shield it from the CP current. The special permit conditions address the possible introduction of an electrolyte, such as water or oxygen, around the carrier pipe or a metallic short in the carrier pipe, which would create an environment that allows corrosion to occur. Further, implementation of the special permit conditions by Hilcorp will provide alternative safety measures to assess, mitigate, and monitor the operations and on-going condition of the carrier and casing pipe to ensure integrity and safety is maintained throughout the operational life of the Liberty Pipeline. 6) Stakeholder Comment: NEPA evaluation must take place before decisions are made and before actions are taken. Such an approach ensures that agencies will take the requisite “hard look” at environmental consequences before approving any major federal action. But PHMSA’s purpose and need statement indicates that it did just the opposite. In other words, the purpose and need statement demonstrates that PHMSA already made the decision to grant the special permit and that its entire analysis was framed in a way to support that pre-determined outcome.  PHMSA Response: The lead agency BOEM has authority to approve siting and construction of the Liberty Development Project. PHMSA received a special permit request for waiver from 49 CFR 195.563 and 195.573, which require CP of a pipeline and the monitoring of pipeline external corrosion control. In its special permit request, Hilcorp Liberty proposes to construct a PIP design by installing the 12.75-inch diameter carrier pipeline within a 16-inch diameter casing pipe. For this design, it is not possible to provide CP to the carrier/inner pipeline. The casing pipe will be cathodically protected in conformance with 49 CFR 195.563. PHMSA evaluated whether PHMSA should approve the special permit request and allow Hilcorp to deviate from the Federal Pipeline Safety Regulations or PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 43 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 whether the pipeline design must comply fully with 49 CFR Part 195. As stated above, PHMSA has no authority over pipeline siting or whether a pipeline is constructed. Based on its comparison of the “no-action” alternative and the selected alternative, PHMSA proposed extensive technical special permit safety conditions to which Hilcorp must comply. Pursuant to PHMSA’s jurisdiction under the Federal Pipeline Safety Laws and Regulations, Hilcorp may withdraw its special permit request at any time and construct a pipeline that fully complies with 49 CFR Part 195. In that case, Hilcorp would not require a special permit from PHMSA. 7) Stakeholder Comment: In the alternatives analysis, the agency must provide sufficient evidence and analysis for determining whether to prepare an environmental impact statement or a finding of no significant impact. The analysis must “rigorously explore and objectively evaluate all reasonable alternatives.” While an agency is not obliged to consider every alternative to every aspect of a proposed action, the agency must consider such alternatives to the proposed action as may partially or completely meet the proposals goal. In its Draft EA PHMSA considered only two alternatives: granting the special permit (the proposed action) and denying the special permit (the no-action alternative). In examining only these two alternatives, PHMSA failed to “rigorously explore” and “objectively evaluate” all reasonable alternatives to allowing Hilcorp to deviate from the Federal Pipeline Safety Regulations. For example, PHMSA failed to examine an alternative that would require a PIP system with CP, which is particularly inappropriate considering Hilcorp’s stated intent to construct a PIP system and the Draft EA’s statement that stakeholders preferred this construction.  PHMSA Response: PHMSA has no authority to impose the selection of a distinct alternative that exceeds the regulatory requirement. As stated above, assuming approval from other cooperating agencies, Hilcorp could proceed with construction of pipeline that complies with 49 CFR Part 195 without a permit from PHMSA. Nonetheless, PHMSA has carefully analyzed the proposed design of Hilcorp’s Liberty Pipeline, which deviates from 49 CFR Part 195. PHMSA analyzed all potential threats that could affect the pipeline, given the proposed pipe in pipe design, and developed an extensive set of conditions that are designed PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 44 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 to ensure a level of safety that meets or exceeds the safety level in 49 CFR Part 195. PHMSA notes that the casing pipe will be cathodically protected but that there is no known mechanism to supply electric current (i.e. “cathodic protection”) to a 5-mile inner/carrier pipeline that is welded inside a vacuum- sealed annulus. PHMSA is not familiar with any pipeline, whether jurisdictional to PHMSA or not, that utilizes a pipe in pipe design with CP reaching the inner/carrier pipeline. 8) Stakeholder Comment: PHMSA failed to consider an alternative that would include additional conditions in the special permit, such as increased inspection requirements. The failure to consider additional conditions is an especially glaring omission given that most proposed conditions merely recite the proposed pipeline design or regulatory requirements with which Hilcorp would be required to comply regardless of the issuance of the special permit. PHMSA also failed to consider an alternative that would restrict the time of year in which the pipeline operates, such as restricting activities from April to October, when waters near the Liberty Project are designated as biologically important areas for bowhead whale feeding, migration, and reproduction.  PHMSA Response: PHMSA is requiring that the Liberty Pipeline to be inspected more frequently and with a varied suite of assessment tools than existing pipeline safety regulations in 49 CFR Part 195. In addition, PHMSA is mandating the environmental conditions of the PIP annulus be controlled and monitored to preclude the creation of a corrosive environment. In order to respond to public concerns, the intervention threshold to address integrity threats has been lowered to allow more time to schedule and repair the pipeline when the least environmental damage is done. (See Special Permit Conditions 11, 13, 15, 16, 17, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, and 32.) 9) Stakeholder Comment: The Draft EA fails to take a hard look at the environmental impacts of granting the special use permit, including the increased risk of oil spills. All oil drilling is inherently dangerous and results in both chronic and disaster-related oil spills. An oil spill in the Arctic would have especially dire consequences for the environment and be impossible to clean up. The risks of oil spills are especially heightened given the harsh Arctic environment and Hilcorp’s documented history of PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 45 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 accidents and safety violations. But PHMSA’s Draft EA fails to adequately consider these realities.  PHMSA Response: The lead agency BOEM published a FEIS, which analyzed the potential impacts from an oil spill resulting from a failure of the Liberty Pipeline. That analysis is available at https://www.boem.gov/Appendix-A- OSRA/. In the selected alternative that analyzes issuance of a special permit to allow the pipe in pipe design, which PHMSA developed in response to Hilcorp’s special permit application, oil released from a failure of the inner/carrier pipe will be contained in the annular space between the inner/carrier pipe and the outer/casing pipeline. As a special permit condition, Hilcorp must install on the Liberty Pipeline a pressure relief valve connecting the annular space to secondary containment vessels (Special Permit Condition 21). 10) Stakeholder Comment: Climate change is causing, and will continue to cause, sea level rise, sea ice melt, and permafrost melt in the Beaufort Sea. Moreover, Alaskan shorelines are eroding at an accelerating rate due to the combined effects of sea-ice loss, increasing sea surface temperatures, increasing terrestrial permafrost degradation, rising sea levels, and increases in storm power and corresponding wave action. Indeed, coastal erosion rates have doubled in the past 50 years along the Beaufort Sea shoreline. Such destabilization can increase the risk of oil spills. For example, the Liberty DPP acknowledges that sea level will rise, and that this will increase the frequency and intensity of strudel scour, which can destabilize pipelines via upheaval buckling.  PHMSA Response: The Liberty pipeline special conditions have been changed to address the continued permafrost degradation, reduced stable sea ice period needed to construct and maintain subsea pipelines, and the risks associated with responding to potential spills in broken ice conditions. PHMSA believes the entire pipeline must be kept in serviceable condition in order to complete the mandated actions on the PIP segment. For that reason, the Special Permit conditions including the assessment and repair criteria is being extended beyond the PIP portion of the Liberty pipeline project and will apply to the entire Liberty Pipeline. (See Special Permit Conditions “Special Permit Segment” definition for the Liberty Pipeline.). PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 46 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 11) Stakeholder Comment: PHMSA’s Draft EA fails to address the real and significant risk of subsidence. Changing environmental conditions will impact the stability and operations of the drilling island and pipeline. This will also impact the safety and vulnerability of the operations, increasing the risk of accidents, oil spills, and other hazards. Permafrost melt will impact the pipelines and other infrastructure over the life of the project. These predictable changes in the near future must be analyzed and disclosed in an EA.  PHMSA Response: The operator is required by existing Federal Pipeline Safety Regulations, specifically the integrity management regulations (49 CFR 195.452), to identify, assess and address risks that may impact the integrity and safe operation of their pipeline systems. Special Permit Condition 23 – Monitoring and Determination of Pipeline Strains and Condition 24 – Integrity Assessment will require integrity monitoring for any Liberty Pipeline subsidence and strains through the development and implementation of strain monitoring procedures and the usage of multi-dimensional geospatial pipeline mapping tools for pipeline movement and settlement, and the usage of high resolution deformation ILI tools for pipeline bending or buckling. PHMSA will inspect this pipeline to ensure Hilcorp is in compliance with the existing integrity management regulations and this special permit, and will confirm Hilcorp is addressing the changing environmental conditions and that their safety measures are confirmed for effectiveness through regular ILI assessments. 12) Stakeholder Comment: According to the Alaska Oil and Gas Conservation Commission (AOGCC), Hilcorp has a documented pattern of safety violations and disregard for compliance with the law in Alaska. As documented by AOGCC, Hilcorp had more than two dozen violations over a 3.5-year period—so many that the agency concluded that “disregard for regulatory compliance is endemic to Hilcorp’s approach to its Alaska operations. In addition to these actions and violations documented by AOGCC, PHMSA itself has sent Hilcorp numerous warning letters for probable violations of pipeline safety regulations in Alaska since November 2015.  PHMSA Response: PHMSA will monitor Hilcorp’s compliance with the special permit conditions and take appropriate action if Hilcorp shows any disregard for PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 47 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 compliance with the special permit conditions or applicable pipeline safety regulations. The special permit specifies that PHMSA has the sole authority to make all determinations on whether Hilcorp has complied with the specified conditions of the special permit. Under 49 CFR 190.341(j), PHMSA has the authority to revoke, suspend, or modify the special permit if it finds that Hilcorp has failed to comply with any material term or condition of the special permit. Finally, the special permit specifies that PHMSA may issue an enforcement action to Hilcorp if they fail to comply. PHMSA is committed to monitoring Hilcorp’s compliance with the terms and conditions of this special permit. 13) Stakeholder Comment: Hilcorp should run a second set of tests before implanting any sort of pipeline. These tests should center around the parameters they missed beforehand such as ice gouging frequency, corrosion, upheaval buckling, and occurrence probabilities for thaw subsidence.  PHMSA Response: The Liberty pipeline will require extensive tests during and immediately after construction to ensure the pipeline is ready to receive fluids. PHMSA is also requiring, in exceedance of existing regulations, another inline inspection tool assessment shortly after commissioning to confirm that the pipeline design, construction, and operation have not manifested any problems or pose a risk to the sensitive Arctic environment. (See Special Permit Condition 24(a) through (d)).  PHMSA Overall Response and Considerations of Public Safety Concerns: PHMSA has reviewed the public comments on docket PHMSA-2017-0091 at regulations.gov through November 14, 2018. Based upon the concerns in the comments as described above, PHMSA has increased the length of the special permit segment by approximately 1.4 miles to include all piping from carrier pipeline launcher to receiver (MP 0.0 to MP 7.2). Additionally, PHMSA has changed the remediation interval timing to further protect the pipeline from possible corrosion leaks and the timing issues of getting repair equipment of site. These additional safety conditions can be reviewed in Special Permit Condition 24(h). Internal coating of the casing pipe was added in Special Permit Condition 10(d) to help prevent internal corrosion. The PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 48 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 implementation of the special permit conditions along all segments of the pipeline will enhance the overall safety and reduce the possibility of environmental impacts from the Liberty Pipeline. 9. Finding of No Significant Impact PHMSA finds that the issuance of the above described special permit, including full compliance with the special permit conditions by Hilcorp, will not result in a significant impact on the human environment. The special permit conditions must be implemented by Hilcorp as a condition of the waiver of the CP requirements under 49 CFR 195.563 and 195.573. PHMSA believes that the issuance of the special permit, which includes safety conditions that exceed current pipeline safety requirements in 49 CFR Part 195, will have a positive impact on the human environment and is not inconsistent with safety. 10. Bibliography C-Core, 2000. An Engineering Assessment of Double Wall Versus Single Wall Designs for Offshore Pipelines in an Arctic Environment. Prepared for the Minerals Management Service, U.S. Department of the Interior. https://www.boem.gov/BOEM- Newsroom/Library/Publications/2000/Engineering-Assessment-of-Pipe.aspx. Coastal Frontiers Corporation. 1998 to 2015. Liberty Development Pipeline Route Surveys. Chatsworth, CA. Hilcorp Alaska, LLC. 2017. Liberty Development Project Development and Production Plan Amendment 3. Submitted to BOEM. May. Hilcorp Alaska, LLC. 2015. Liberty Development Project Development and Production Plan Revision 1 Appendix A – Environmental Impact Analysis. Submitted to BOEM. September. Hilcorp Alaska, LLC. 2016. Application for Pipeline Right-of-Way Lease. Submitted to ADNR. National Oceanic and Atmospheric Administration (NOAA). 1998. Liberty Pipeline Route Survey Program. PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 49 of 50 <<>> Liberty Pipeline - Special Permit - FEA and FONSI – Docket: PHMSA-2017-0091 Vaudrey, K. and Coastal Frontiers Corporation. 2013. Design Basis for Ice Criteria for Select Stage Liberty Development, Rev 0. Anchorage, Alaska: BPXA. Vaudrey, K. 1984, 85, and 86. Breakup Study of the Alaskan Beaufort and Upper Chukchi Seas. AOGA Projects 224, 274 and 319, Vaudrey & Associates, Inc., San Luis Obispo, CA. Completed in Washington DC on: April 29, 2019 Prepared by: Pipeline and Hazardous Materials Safety Administration PHMSA-2017-0091: Hilcorp Alaska - Liberty Pipeline – Special Permit Final Environmental Assessment and Finding of No Significant Impact Page 50 of 50 ## Provenance - Official: Yes - Source: - Source ID: `phmsa-special-permits` - SHA-256: `cfa070a47e145083c623568a4a1016f5a97122e42004336bd56bf32abca28637` - Retrieved: 2026-08-20T01:06:17.853Z - Exported: 2026-08-23T05:19:22.732Z - Document slug: `phmsa-special-permit-phmsa-2017-0091` ### Source metadata ```json { "materialSubtype": "pipeline_special_permit", "operator": "Hilcorp Alaska, LLC", "system": "Hazardous Liquid", "issuedOn": "2019-04-29", "issuanceStatus": "issued", "renewal": null, "indexUrl": "https://www.phmsa.dot.gov/pipeline/special-permits-state-waivers/special-permits-issued", "docketUrl": "https://www.regulations.gov/docket/PHMSA-2017-0091", "docketDocumentCount": 8, "decisionDocumentCount": 3, "decisions": [ { "id": "PHMSA-2017-0091-0012-0900006483c45fc1", "regulationsGovDocumentId": "PHMSA-2017-0091-0012", "title": "Hilcorp Liberty LOD with SP", "postedDate": "2019-05-09", "documentUrl": "https://www.regulations.gov/document/PHMSA-2017-0091-0012", "pdfUrl": "https://downloads.regulations.gov/PHMSA-2017-0091-0012/attachment_1.pdf", "pdfArtifactPath": "data/sources/phmsa-special-permits/artifacts/phmsa-2017-0091/phmsa-2017-0091-0012-0900006483c45fc1.pdf", "pdfArtifactSha256": "2c83d7090269d662318deccf39e4581f101178602b7ff647ac3f729078781dea", "extractedTextPath": "data/sources/phmsa-special-permits/artifacts/phmsa-2017-0091/phmsa-2017-0091-0012-0900006483c45fc1.txt", "extractedTextSha256": "9053a764932b821feeeb20e9404501dea28e567452977e093046a45846872c44", "pageCount": 46, "extractionVersion": 2 }, { "id": "PHMSA-2017-0091-0012-0900006483c45fc2", "regulationsGovDocumentId": "PHMSA-2017-0091-0012", "title": "Hilcorp Liberty Pipeine - SP Cathodic Protection - Analysis and Findings", "postedDate": "2019-05-09", "documentUrl": "https://www.regulations.gov/document/PHMSA-2017-0091-0012", "pdfUrl": "https://downloads.regulations.gov/PHMSA-2017-0091-0012/attachment_2.pdf", "pdfArtifactPath": "data/sources/phmsa-special-permits/artifacts/phmsa-2017-0091/phmsa-2017-0091-0012-0900006483c45fc2.pdf", "pdfArtifactSha256": "853ab2ee2ac78874a97e559b26019711a81f78cc22f4fa974143e3b624500ccf", "extractedTextPath": "data/sources/phmsa-special-permits/artifacts/phmsa-2017-0091/phmsa-2017-0091-0012-0900006483c45fc2.txt", "extractedTextSha256": "010448e6064c1b3f23c01807befddc78e6e4caa451453790edf8f2e774182781", "pageCount": 26, "extractionVersion": 2 }, { "id": "PHMSA-2017-0091-0012-0900006483c45fc3", "regulationsGovDocumentId": "PHMSA-2017-0091-0012", "title": "Hilcorp Liberty Pipeline - FEA and FONSI - (002)", "postedDate": "2019-05-09", "documentUrl": "https://www.regulations.gov/document/PHMSA-2017-0091-0012", "pdfUrl": "https://downloads.regulations.gov/PHMSA-2017-0091-0012/attachment_3.pdf", "pdfArtifactPath": "data/sources/phmsa-special-permits/artifacts/phmsa-2017-0091/phmsa-2017-0091-0012.pdf", "pdfArtifactSha256": "9a32f3273d5bc2cdfa9aae0b70c5099b4803b950a079ab7b6f1731bde0dfa743", "extractedTextPath": "data/sources/phmsa-special-permits/artifacts/phmsa-2017-0091/phmsa-2017-0091-0012.txt", "extractedTextSha256": "b6f4f9e8e6911c968d3c8f2d94af8aec1336d9fa611d90487f85206211518c80", "pageCount": 50, "extractionVersion": 2 } ], "citedSections": [ "195.563", "195.573", "195.452", "195.106", "195.3", "195.304", "195.306", "191.22", "195.501", "195.2", "195.228", "195.230", "195.234", "195.214", "195.401", "195.422", "195.585", "195.444", "195.446", "195.305", "190.341", "195.579" ], "caveat": "The issued-permit index establishes issuance, not current validity or applicability to facilities beyond those covered by the permit. 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