# Pipeline Safety: Applying Safety Regulations to All Rural Onshore Hazardous Liquid Low-Stress Lines

- **operation:** document
- **citation:** 76 FR 25576
- **title:** Pipeline Safety: Applying Safety Regulations to All Rural Onshore Hazardous Liquid Low-Stress Lines
- **source type:** rulemaking
- **agency:** Pipeline and Hazardous Materials Safety Administration
- **status:** historical
- **official:** true
- **published on:** 2011-05-05
- **effective on:** 2011-10-01
- **summary:** PHMSA is amending its pipeline safety regulations to apply safety regulation to rural low-stress hazardous liquid pipelines that were not covered previously by safety regulations. This change complies with a mandate in the Pipeline Inspection, Protection, Enforcement, and Safety Act of 2006 (PIPES Act).
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- **app url:** https://regulus.evalyn.ai/document/federal-register-2011-10778
- **source url:** https://www.federalregister.gov/documents/2011/05/05/2011-10778/pipeline-safety-applying-safety-regulations-to-all-rural-onshore-hazardous-liquid-low-stress-lines
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Federal Register, Volume 76 Issue 87 (Thursday, May 5, 2011) [Federal Register Volume 76, Number 87 (Thursday, May 5, 2011)] [Rules and Regulations] [Pages 25576-25588] From the Federal Register Online via the Government Publishing Office [ www.gpo.gov ] [FR Doc No: 2011-10778] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Pipeline and Hazardous Materials Safety Administration 49 CFR Part 195 [Docket PHMSA-2008-0186; Amdt. 195-96] RIN 2137-AE36 Pipeline Safety: Applying Safety Regulations to All Rural Onshore Hazardous Liquid Low-Stress Lines AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA), Department of Transportation (DOT). ACTION: Final rule. ----------------------------------------------------------------------- SUMMARY: PHMSA is amending its pipeline safety regulations to apply safety regulation to rural low-stress hazardous liquid pipelines that were not covered previously by safety regulations. This change complies with a mandate in the Pipeline Inspection, Protection, Enforcement, and Safety Act of 2006 (PIPES Act). DATES: This final rule takes effect October 1, 2011. FOR FURTHER INFORMATION CONTACT: For technical contents of the final rule contact Mike Israni by phone at 202-366-4571 or by e-mail at [email protected] . For all other information contact Tewabe Asebe by phone at 202-366-4595 or by e-mail at [email protected] . SUPPLEMENTARY INFORMATION: [[Page 25577]] Background Until 2008, a hazardous liquid pipeline operating at low-stress in a rural area was not regulated under Federal pipeline safety regulations in 49 CFR part 195 unless it crossed a commercially navigable waterway. Section 195.2 defines a ``rural area'' as one outside the limits of any incorporated or unincorporated city, town, village, or any other designated residential or commercial area, such as a subdivision, a business or shopping center, or community development. The PIPES Act was signed into law on December 29, 2006, (Pub. L. 109-468). Section four of the PIPES Act (codified at 49 U.S.C. 60102(k)) required PHMSA to ``issue regulations subjecting low-stress hazardous liquid pipelines to the same standards and regulations as other hazardous liquid pipelines.'' The PIPES Act also stated that the new regulations could be issued in phases. Implementation of the PIPES Act Mandate PHMSA decided to implement the PIPES Act mandate in phases, in part because PHMSA did not have complete data on the extent of rural low- stress pipelines that would be covered by the statutory mandate. Phase one, through a final rule published on June 3, 2008, (73 FR 31634), applied full Part 195 regulation to higher-risk, larger-diameter rural low-stress pipelines (i.e., those low-stress pipelines with a diameter of 8 \5/8\ inches or greater located in or within one-half mile of an unusually sensitive area (USA)). (These requirements are in 49 CFR 195.12.) These are the rural low-stress pipelines that have more potential to cause harm to USAs. These were also the rural low-stress pipelines on which PHMSA had the most information to prepare a regulatory cost/benefit evaluation. PHMSA planned to regulate all remaining rural low-stress pipelines (i.e., smaller-diameter--less than 8 \5/8\ inches diameter--rural low-stress pipelines located in or within one-half mile of a USA and all rural low-stress pipelines, of any diameter, located outside the one-half mile USA buffer) once PHMSA had more complete information on the extent of these unregulated rural low-stress pipelines. Phase one also applied reporting requirements in Subpart B of Part 195 to all rural low-stress pipelines (Sec. 195.48). This data was necessary for PHMSA to complete the regulatory evaluation for the extension of all safety requirements to the remaining rural low-stress pipelines in phase two. Surveys Because PHMSA did not have adequate information on the number of operators with rural low-stress pipelines, or on the total mileage of these lines in service, we initiated the following actions: (1) We revised the Pipeline Safety Regulations to require operators of any low-stress line (including those rural low-stress lines not brought under safety regulations) to comply with the annual reporting requirements and the incident reporting requirements of Part 195. This was part of phase one, as discussed above. (2) On July 31, 2008, (73 FR 44800) OMB Control Number 2137-0623, PHMSA published in the Federal Register a notice of OMB-approved survey asking each operator of a rural low-stress hazardous liquid pipeline for voluntary information concerning the mileage and characteristics of these pipelines to assess the costs of subjecting rural low-stress pipeline mileage to Part 195 regulation. (3) Based on the information received in response to the notice, PHMSA conducted two follow-up inquiries: (1) A request for information from operators who operate rural low-stress lines to determine the potential operating costs they were likely to incur to bring these unregulated lines into compliance with Part 195 regulation; and (2) a request to states with the majority of rural low-stress lines to identify any incident data the state may have collected through the years. Phase Two--Notice of Proposed Rulemaking With the information PHMSA gathered, we moved to phase two to complete the requirement of the PIPES Act and to apply Part 195 safety requirements to all rural low-stress pipelines not included in the phase one rule. A Notice of Proposed Rulemaking (NPRM) was published in the Federal Register on June 22, 2010, (75 FR 35366) that proposed to extend Part 195 safety requirements to rural low-stress pipelines of any diameter located more than one-half mile from a USA and those less than 8\5/8\ inches in diameter located in or within one-half mile of a USA. The phase one rule established compliance deadlines for the rural low-stress pipelines that it addressed. The phase two NPRM proposed no changes to these phase one deadlines, but proposed new compliance deadlines to apply the requirements to the phase two rural low-stress pipelines proposed for regulation. In addition, PHMSA proposed to define the scope of the ``could affect'' buffer for application of the integrity management (IM) requirements in Sec. 195.452 to the phase two pipelines. To codify the compliance dates and requirements, we proposed to define three ``categories'' of rural low-stress pipelines subject to the requirements of Sec. 195.12. These were as follows: Category 1: Those rural low-stress pipelines that were covered under the phase one rule; Category 2: Rural low-stress pipelines of smaller diameter (less than 8\5/8\ inches diameter) located in or within one-half mile of a USA (which would be subject to all Part 195 requirements including IM requirements); and Category 3: All other rural low-stress pipelines that were not included in phase one. Category 3 lines would fall outside the defined ``could affect'' buffer for application of IM requirements. Integrity Management Section 195.452 addresses IM requirements for hazardous liquid pipelines. Under the requirements of that section, operators must take additional actions for each pipeline segment that could affect a high consequence area (HCA). PHMSA has defined HCAs as populated areas, commercially navigable waterways and USAs. HCAs are identified and displayed on maps available from the NPMS. To comply with IM requirements, pipeline operators must first determine which segments of their pipeline could affect an HCA. To do this, an operator needs to compare its pipeline's location to the locations of HCAs and determine which segments of the pipeline could affect an HCA if there was a product release from the segment. These comparisons have proven to be considerably more burdensome in practice than PHMSA believed when IM rules were initially established. They involve more than just comparison of maps of pipeline location to maps of HCAs. Operators have had to consider the topography and nature of ground cover around their pipelines to estimate the direction and distance that released product might flow. Operators have also had to consider the potential transport of released product via nearby waterways, including such factors as seasonal variations in flow, the effect of stream turbulence, and their ability to respond to a release and contain further transport of spilled product. During the phase one rulemaking for rural low-stress pipelines, PHMSA [[Page 25578]] concluded it would be unnecessarily burdensome to require operators of these pipelines to perform a complete ``could affect'' analysis to determine which rural low-stress pipeline segments would be subject to IM requirements. Rather, PHMSA adopted a one-half mile buffer around USAs \1\ as the ``could affect'' area (i.e., any rural low-stress pipeline segment covered by the phase one rule within the one-half mile buffer would be subject to IM requirements). PHMSA found it unlikely a ``could affect'' analysis on a rural low-stress pipeline would result in a larger area than the one-half mile buffer for application of IM requirements. Available data showed that the largest spill on land from a low-stress line covered two acres. An acre is 43,560 square feet. If this spill had been limited to a corridor 35 feet wide over its entire length, it still would not have traveled one-half mile. This data, coupled with the relatively lower pressure of low-stress pipelines, led PHMSA to conclude that a one-half mile buffer was more than adequate for application of IM requirements. In the NPRM, PHMSA proposed to continue to use the one-half mile buffer for phase two because PHMSA believed it would be an adequate ``could affect'' area that identifies the vast majority (if not all) of rural low-stress pipelines that could affect a USA. --------------------------------------------------------------------------- \1\ The other component of HCAs (i.e., populated areas) was not affected by the phase one rulemaking and was not included in the phase two NPRM since pipelines in populated areas are not, by definition, in ``rural areas'' and are already regulated. --------------------------------------------------------------------------- As in phase one, PHMSA also proposed to include an option for pipeline operators to use ``could affect'' analyses in lieu of the one- half mile buffer to determine which of their smaller-diameter low- stress pipelines would be subject to IM requirements. PHMSA recognized that operators could use this option in circumstances where it is likely the ``could affect'' analysis would determine that a pipeline segment cannot affect a USA (e.g., where the USA is uphill from the pipeline). Nevertheless, PHMSA concluded it would be unreasonable to exclude this option for rural low-stress pipelines since it can identify instances in which application of IM requirements would be unnecessary. Economic Burden The phase one rule allowed operators of pipelines meeting specified criteria to notify PHMSA if they would incur an excessive economic burden in complying with IM assessment requirements. The criteria were designed for rural pipelines that carry oil from a production facility (e.g., well) and where the pipeline would be abandoned or shut down as a result of the economic burden associated with IM assessments. The phase one rule provided that PHMSA would stay compliance with the IM assessment requirements while it reviews the notification. Based on the outcome of the review, PHMSA may grant the operator a special permit imposing alternative safety requirements in lieu of IM assessments. For phase two, PHMSA considered extending the economic compliance burden provision to Category 2 pipelines--those smaller diameter rural low-stress pipelines located in or within one-half mile of a USA that would be subject to IM assessment requirements. (Category 3 low-stress pipelines would not be subject to the IM requirements under the NPRM, as described above). PHMSA concluded that this was not necessary because no Category 2 low-stress pipeline would meet the criteria in the economic burden compliance provision (Sec. 195.12(c)) and concerns about preserving oil production or minimizing risk of alternative transport of crude oil from wells would not apply to these pipelines. Accordingly, we did not propose to extend the economic burden compliance provision to these pipelines in the NPRM. Pipelines Subject to USCG Regulation Section 195.1(b)(3) states that Part 195 requirements do not apply to pipelines subject to safety regulations of the United States Coast Guard (USCG). The NPRM noted that this exception had previously applied only to low-stress pipelines subject to USCG regulation and through a drafting error in the phase one final rule, was inadvertently expanded to all pipelines subject to USCG requirements. PHMSA proposed to correct this error. Public Comments PHMSA received comments from three trade associations (two of which filed joint comments), one government agency (National Transportation Safety Board, NTSB), one pipeline consultant, and one individual. None of the comments objected to the changes proposed in the NPRM. The American Petroleum Institute (API) and the Association of Oil Pipelines (AOPL), in joint comments, explicitly noted that they did not oppose application of the baseline requirements of Part 195 to all low-stress pipelines and a requirement that rural low-stress pipelines within one- half mile of a USA also be subject to the IM requirements of Part 195. NTSB supported regulating all low-stress pipelines with requirements graded according to risk. All those commenting suggested some changes, however. Several comments addressed the scope of the proposed rule. API-AOPL requested that PHMSA clarify that the proposed rule did not apply to gathering or production pipelines or to pipelines excluded from regulation in Sec. 195.1(b). The Independent Petroleum Association of America similarly requested clarification that the proposed requirements do not apply to gathering pipelines. NTSB suggested that the change should include all rural gathering lines and gathering lines in inlets of the Gulf of Mexico. Tracy S. Dahl, who commented on behalf of herself, suggested that the scope should include low-stress gas pipelines such as those associated with coal bed methane gas production. With the exception of correcting a drafting error associated with low-stress pipelines subject to regulation by the USCG (discussed above), the NPRM proposed no changes to the exclusions listed in Sec. 195.1(b). This section lists the types of pipelines excluded from the requirements of Part 195. The NPRM did not propose any new requirements for gathering pipelines, and thus no requirements applicable to those pipelines may be included in this final rule. Regulation of rural gathering pipelines is governed by Sec. 195.11, which is not affected by this rulemaking. Further, PHMSA notes that Section 4 of the PIPES Act explicitly states, ``[t]he regulations issued under this paragraph shall not apply to gathering lines.'' \2\ Gas pipelines were not included in the scope of the NPRM and thus no new requirements can be applied to gas pipelines as part of this rulemaking. --------------------------------------------------------------------------- \2\ 49 U.S.C. 60102(k)(1), as amended by PIPES Act Section 4. --------------------------------------------------------------------------- API-AOPL specifically requested that PHMSA clarify the exclusion in paragraph (4) of Sec. 195.1(b) applying to ``[a] low-stress pipeline that serves refining, manufacturing, or truck, rail, or vessel terminal facilities, if the pipeline is less than one mile long (measured outside facility grounds) and does not cross an offshore area or a waterway currently used for commercial navigation.'' API-AOPL noted that PHMSA field personnel have recently informed certain pipeline operators that these segments are part of a larger, non-low-stress pipeline and are thus subject to Part 195, which the associations believe is contrary to the plain language of the regulation. As noted above, the exclusions of Sec. 195.1(b) are not changed [[Page 25579]] by this rulemaking, and low-stress inter-facility pipelines meeting these criteria are excluded from regulation under Part 195. However, PHMSA notes that Sec. 195.2 and the PIPES Act both define a low-stress hazardous liquid pipeline to be one ``that is operated in its entirety at a stress level of 20 percent or less of the specified minimum yield strength of the line pipe'' (emphasis added). Inter-facility pipelines operating at less than 20% SMYS that is part of a larger pipeline (i.e., some of which operates at higher stress levels) would not fall under this exclusion. Such inter-facility pipelines would be subject to Part 195. Determining whether particular inter-facility piping is part of a larger pipeline depends on the characteristics of individual installations and the applicability of Part 195 requirements to specific inter-facility lines. API-AOPL objected to the proposed change to the exception in Sec. 195.1(b)(3) for pipelines subject to regulation by the USCG. API-AOPL contended that this was not an error because the change was included in the phase one NPRM and final rule, had been subject to notice and comment and thus cannot simply be ``corrected.'' PHMSA disagrees. The entire rulemaking record clearly demonstrates that this was an error in the regulatory language in the phase one rule. API-AOPL is correct that the re-write of the regulatory language of Sec. 195.1(b) in the phase one NPRM failed to limit this exception to low-stress pipelines and that this omission was repeated in the regulatory language in the final phase one rule. The remainder of the record makes it clear, however, that this change was not intended. The NPRM for the phase one rule stated that PHMSA had * * * also clarified the language in several of the exceptions from part 195's coverage. We have not changed the intent or scope of any of these. We have simply cleaned up some of the language to make the exceptions easier to read \3\ (emphasis added). --------------------------------------------------------------------------- \3\ Federal Register, September 6, 2006, 71 FR 52511. The NPRM stated elsewhere that, ``[t]his proposal will not affect other exempt low-stress lines, specifically pipelines subject to the safety regulations of the USCG * * *'' \4\ (emphasis added). The exception applicable to lines subject to USCG regulation prior to the effective date of the phase one final rule clearly applied only to low- stress pipelines. Further, the PIPES Act required that PHMSA continue to except from part 195 those ``low-stress hazardous liquid pipelines'' that were subject to USCG safety regulations. Therefore, PHMSA concludes that the record demonstrates the regulatory language in the phase one final rule concerning the exemption for low-stress pipelines subject to USCG regulation was an inadvertent error and that error has been corrected in this final rule. --------------------------------------------------------------------------- \4\ Federal Register, September 6, 2006, 71 FR 52505. --------------------------------------------------------------------------- API-AOPL and the Independent Petroleum Association of America suggested that PHMSA exclude low-stress carbon dioxide (CO 2 ) pipelines involved in enhanced oil recovery and/or carbon capture and storage. The associations noted that these pipelines pose different risks from petroleum pipelines, that releases from low-stress CO 2 pipelines would not require the cleanup that would be associated with releases from crude oil or refined petroleum product pipelines, and that new requirements on CO 2 lines could have a chilling effect on future investment in such pipelines. PHMSA notes that these factors were not raised in comments on the phase one rule even though the phase one rule applies to rural low-stress CO 2 pipelines. PHMSA never proposed such an exclusion and also considers it inappropriate to exclude some rural low-stress CO 2 pipelines from safety regulation while regulating others (i.e., those subject to the phase one final rule), and has not incorporated the suggested exclusion in this final rule. API-AOPL also objected to the proposed requirement that a pipeline segment subject to IM requirements must remain subject to those requirements if subsequent changes to USA boundaries result in it being more than one-half mile from a USA. They contended this requirement is inappropriate and unsupported. They stated: ``[i]f future analyses demonstrate that a segment could affect a USA that it previously could not affect, an operator is appropriately required to apply IMP requirements to that segment. Likewise, if a segment no longer could affect a USA, it is only equitable that an operator need not apply the additional protection of such plans to the segment.'' PHMSA would agree if the operator of a rural low-stress pipeline were, indeed, required to analyze its pipelines to determine which segments could affect a USA. They are not. This final rule uses a one- half mile buffer as a surrogate for these expensive and complex analyses, as did the phase one rule. While PHMSA considers this a reasonable surrogate, it is possible, though unlikely, that a pipeline segment slightly less than one-half mile from a USA could not affect that USA and it is similarly possible that a pipeline segment slightly more than one-half mile distant could affect a USA. Thus, eliminating IM requirements that already apply solely because the distance to a USA has increased above one-half mile is not appropriate. Operators always have the option to perform an analysis to demonstrate that any pipeline segment could not affect a USA, in which case IM requirements need not apply regardless of the distance from a USA. Operators who experience a change in USA boundaries could exercise this option to remove a pipeline segment from IM scope. If the change in USA boundaries is significant (e.g., the USA ceases to exist), demonstrating that a segment could not affect a USA could be a simple analysis. PHMSA has retained in this final rule the requirement that a pipeline segment determined to be subject to IM requirements due to proximity to a USA must remain subject to those requirements if boundary changes result in more than one-half mile separation, absent a demonstration that the segment could not affect a USA. Thomas Lael Services, L.P., a pipeline consultant, suggested changes to the regulatory language to improve clarity. Specifically, Lael suggested that proposed Sec. Sec. 195.12(c)(2)(i) and 195.12(c)(3)(i) be modified to refer specifically to the criteria defining the pipeline segments for which identification is required. PHMSA agrees that this change would improve the clarity of the regulatory language and has revised the final rule accordingly. Lael also suggested that the provision allowing the operator of a Category 1 rural low-stress pipeline to notify PHMSA of undue economic burden should be extended to operators of Category 2 rural low-stress pipelines. Lael noted that revenue is less for these smaller-diameter pipelines while costs are the same, increasing the importance of considering economic burden. Lael cites costs associated with patrolling the pipeline and performing pipe-to-soil potential readings as examples. These requirements, however, are outside the scope of the economic burden provision. That provision allows an operator of a Category 1 rural low-stress pipeline to notify PHMSA if the economic burden of complying with IM assessment requirements, not other provisions as cited by Lael, would be sufficient to cause the operator to shut down its pipeline. The provision is applicable only to pipelines carrying crude oil from a production facility (among other criteria). Pipelines of 8\5/8\ inches or less nominal outside diameter--the size that would [[Page 25580]] categorize a rural low-stress pipeline as Category 2--and that carry crude oil from a production facility are, by definition, gathering pipelines. Gathering pipelines, as noted above, are not subject to the provisions of Sec. 195.12 and are not subject to IM requirements. Thus, PHMSA concludes that no change to the economic burden provision is needed. Lael also suggested that the time allowed for operators to identify Category 2 and 3 rural low-stress pipelines be extended to 12 months from the proposed nine months. Lael noted that this would correct an apparent inconsistency with discussion in the NPRM preamble noting the proposed timeframes were the same as those required in phase one; therefore, 12-month timeframes were being proposed for operators of Category 2 and 3 rural low-stress pipelines in instances where 12 months was required of operators of Category 1 rural low-stress pipelines. There is no inconsistency. The NPRM preamble discussion cited by Lael clearly uses 12 months only as an example. The phase one rule required operators of Category 1 rural low-stress pipelines to identify pipeline segments meeting the criteria in the rule before nine months after the effective date of the phase 1 rule. Nine months is also required for Category 2 and 3 rural low-stress pipelines in this final rule, thus affording the consistency discussed in the NPRM. Lael also questioned the logic of a statement in the phase two NPRM that available data showed that the largest spill on land from a low- stress pipeline traveled two acres and that this justified a one-half mile buffer as a surrogate for analyses of whether a pipeline segment could affect a USA. Lael noted that an acre is a measure of area rather than a measure of distance. PHMSA agrees that the NPRM statement was unclear about the assumptions we used to conclude that this data demonstrated a one-half mile buffer was adequate. PHMSA considered that a spill covering two acres would need to be limited to 35 feet in width over its entire length if it were to extend one-half mile from the pipeline. We concluded that it was unlikely that a spill would behave in this manner and that based on the data we could conclude that a one- half mile buffer was adequate. PHMSA has revised the discussion in the preamble of this final rule to better explain its reasoning. API-AOPL raised a number of concerns regarding the draft regulatory analysis and regulatory flexibility (i.e., small business) analysis supporting the NPRM. These included use of data from parent companies rather than distinct operating subsidiaries in determining whether small businesses could be affected and use of inappropriate data to estimate costs. These comments have been addressed in the final regulatory analysis that is included in the rulemaking docket. Finally, NTSB suggested that PHMSA should be given sole jurisdiction over offshore pipelines on the outer continental shelf. NTSB noted, in making this suggestion, that regulation of offshore pipelines was outside the scope of this NPRM. PHMSA agrees that changes in PHMSA jurisdiction over offshore pipelines are beyond the scope of this proceeding. Consideration by Technical Hazardous Liquid Pipeline Safety Standards Committee On December 3, 2010, PHMSA discussed the proposed rule with the Technical Hazardous Liquid Pipeline Safety Standards Committee (THLPSSC). The THLPSSC is a statutorily mandated advisory committee that advises PHMSA about the technical feasibility, reasonableness and cost-effectiveness of its proposed regulations. PHMSA discussed the comments received in response to the NPRM (e.g., concerns over effect on pipelines excluded from regulation and on rural gathering pipelines). These comments have been previously discussed in this document. After careful consideration, the THLPSSC voted unanimously to find the NPRM and supporting regulatory evaluation technically feasible, reasonable, practicable, and cost effective. A transcript of the meeting is available in the docket for this rulemaking. Final Rule This final rule revises 49 CFR part 195 to cover: (1) Rural onshore low-stress pipelines with a diameter smaller than 8\5/8\ inches located in or within one-half mile of a USA and (2) rural onshore low-stress pipelines of any diameter located more than one-half mile from a USA. With the publication of this final rule, and with limited exceptions, all low-stress pipelines regardless of location or size are now subject to the pipeline safety regulations. The final rule continues in place the one-half mile buffer to be used as the ``could affect'' area for application of IM requirements. Our phased approach resulted in several distinct groups of rural low-stress pipelines: Rural low-stress pipelines that cross navigable waterways. These have historically been subject to the safety requirements of Part 195. These pipelines were not affected by phase one and are not affected by this rulemaking. Rural low-stress pipelines 8\5/8\ inches or greater in diameter that are located in or within one-half mile of a USA. The requirements of Part 195 were made applicable to these rural pipelines in the phase one rule. Rural low-stress pipelines less than 8\5/8\ inches in diameter that are located in or within one-half mile of a USA. These pipelines are made subject to the safety requirements of Part 195, including the IM requirements in Sec. 195.452, by this final rule. Rural low-stress pipelines of any diameter that are located more than one-half mile from a USA. These pipelines are also made subject to the safety requirements of Part 195, excluding the IM requirements in Sec. 195.452, by this final rule. The phase one rule established a number of compliance deadlines for the rural pipelines it addressed, now referred to as Category 1 rural low-stress pipelines. These deadlines varied from relatively near term (e.g., identifying all pipeline segments subject to the phase one rule by April 3, 2009) to long term (e.g., completing baseline IM assessments by July 3, 2015). This final rule retains the compliance deadlines established in phase one for Category 1 rural low-stress pipelines. This rule subjects Category 2 rural low-stress pipelines to the same Part 195 requirements as those made applicable to Category 1 pipelines in phase one but with different compliance deadlines. Finally, this rule applies all requirements of Part 195 to Category 3 rural low-stress pipelines except for the IM requirements of Sec. 195.452. Consistent with the phase one rule, pipeline segments will have to be identified within nine months of publication of this final rule, baseline IM assessments will have to be completed within five years of publication of the final rule, compliance with the requirements of subpart H of Part 195, Corrosion Control, will have to occur within three years and compliance with all other applicable requirements will have to occur with 12 months of publication of the final rule. This final rule includes, as did the phase one rule, an option for operators to determine which pipeline segments are subject to IM requirements by performing analyses to determine whether pipeline segments could affect a USA in lieu of using the one-half-mile buffer. This rule includes, as did the phase one rule, a provision addressing newly [[Page 25581]] identified USAs. Such new USAs could result in additional pipeline segments meeting criteria for Category 1 or 2 rural low-stress pipelines and thus become subject to IM requirements. This final rule requires that pipeline segments identified as Category 1 or 2 continue to meet the requirements applicable to those Categories even if the boundaries of a USA are redefined so that the pipeline segment (or portion thereof) is no longer within one-half mile of the USA unless the operator determines that the segment could not affect the USA. This provision adds no additional burden because pipeline operators may simply continue to treat their pipelines as they would have without the redefinition of USA boundaries. Section-by-Section Analysis Section 195.1 Which pipelines are covered by this Part? Section 195.1 has been revised numerous times over the years to include changes to the pipelines covered or excluded from the scope of Part 195. Section 195.1 was revised in the phase one rule to provide more clarity and to include the phase one rural low-stress pipelines within the scope of Part 195. This final rule revises Sections 195.1(a) and (b) to include the rural low-stress pipelines brought under Part 195 regulations in phase two. The changes to this section do not affect any of the other covered or excluded pipelines previously identified in Sec. 195.1. This final rule also corrects an inadvertent error to Sec. 195.1 that was introduced by the changes made under the phase one rule. The error concerns the long-standing exception for low-stress pipelines subject to the regulations of the USCG. Under the phase one rule, Sec. 195.1 was incorrectly revised to state that Part 195 does not apply to any pipeline subject to the safety regulations of the USCG. In this final rule, we are correcting Sec. 195.1 to state again that Part 195 does not apply to any low-stress pipeline subject to the safety regulations of the USCG. Section 195.12 What requirements apply to low-stress pipelines in rural areas? This Section is being revised to clarify that all previously unregulated low-stress pipelines in rural areas are now covered under Part 195 regulation. This Section does not apply to rural low-stress pipelines that cross a waterway used for commercial navigation because they have been regulated under Part 195 before either of the rulemakings addressing rural low-stress pipelines. This section has been revised to define three categories of rural low-stress pipelines (Section 195.12(b)): Category 1 lines are those that were regulated in phase one (i.e., rural low-stress pipelines with a diameter of 8\5/8\ inches or more located in or within one-half mile of a USA). Category 2 pipelines are those rural low-stress pipelines of smaller diameter (less than 8\5/8\ inches) located in or within one- half mile of a USA. Category 3 are all remaining rural low-stress pipelines except for those that cross navigable waterways (which are already regulated under Sec. 195.1 and are not addressed in Sec. 195.12). Section 195.12(c) also sets forth the required deadlines for compliance with various portions of Part 195. The compliance deadlines established by the phase one final rule for Category 1 rural low-stress pipelines remain unchanged. Except for the compliance deadlines for the completion of baseline IM assessments, this final rule establishes deadlines for Category 2 and Category 3 rural low-stress pipelines in the same manner as was done for Category 1 pipelines. For example, operators of Category 1 rural low-stress pipelines were required to identify these pipelines within nine months of the effective date of the phase one final rule and this final rule requires the same nine- month time frame for an operator of a Category 2 or Category 3 rural low-stress pipeline. In phase one, PHMSA adopted a compliance deadline of three and one-half years for completing 50% of baseline IM assessments and seven years for completing all baseline assessments. PHMSA concluded that it was appropriate to reduce the compliance deadlines for these requirements for the pipelines covered by this final rule considering the amount of time that has transpired since the passage of the PIPES Act and the relatively small number of miles that would be subject to these requirements. Thus, this final rule requires that operators of Category 2 pipelines complete all baseline IM assessments within five years of the effective date of the final rule and that at least 50 percent of the assessments be completed within two and one-half years. As discussed above, PHMSA did not change the provision allowing operators of some Category 1 rural low-stress pipelines to notify PHMSA if they conclude that implementing the IM assessment requirements would pose such an economic burden that they would abandon their pipelines. This provision continues to be limited to Category 1 rural low-stress pipelines carrying crude oil from production facilities and where shutdown of the pipeline would cause loss of oil supply or a transition to truck transportation. PHMSA (with assistance from DOE, as appropriate) will review notifications and, if justified, may grant the operator a special permit to allow continued operation of the pipeline subject to alternative safety requirements. PHMSA's reasoning for not extending the provision to Category 2 pipelines is based on the definition of ``gathering line'' in Sec. 195.2. That Section defines any ``pipeline 219.1 mm (8\5/8\ inch) or less nominal outside diameter that transports petroleum from a production facility'' as a gathering line. Gathering lines are not subject to the provisions of Sec. 195.12. Instead, requirements applicable to regulated rural gathering lines are found in Sec. 195.11, and do not include IM requirements. As a result, no rural low- stress pipeline of 8\5/8\ inch or less nominal diameter that carries crude oil from a production facility is subject to IM requirements, and it is not necessary to provide an economic burden provision for these pipelines to ameliorate unintended impacts on production. Section 195.48 Scope This Section was added in the phase one final rule. There had not previously been a scope Section in Subpart B because all pipelines subject to Part 195 were subject to all the reporting requirements in Subpart B. This Section was added in phase one because the reporting requirements of Subpart B were made applicable to all rural low-stress pipelines, even those not subject to the safety requirements of the phase one rule. Operators of those rural low-stress pipelines not subject to the technical requirements of Part 195 under phase one were not required to complete those portions of the annual report form that relate to IM requirements and inspections. With this final rule, all rural low-stress pipelines are now subject to all requirements of Part 195, except that Category 3 pipelines are not subject to the IM requirements in Sec. 195.452. The exclusion of portions of the annual report form related to IM has therefore been modified to apply only to operators of Category 3 pipelines. Regulatory Analyses and Notices Executive Order 12866 and DOT Policies and Procedures PHMSA considers this final rule a non-significant regulatory action under Section 3(f) of Executive Order 12866 [[Page 25582]] (58 FR 51735; Oct. 4, 1993). The rule is also non-significant under DOT regulatory policies and procedures (44 FR 11034: February 26, 1979). PHMSA prepared a Regulatory Evaluation, a copy of which has been placed in the docket. This final rule affects those rural low- stress pipelines of any diameter that are more than one-half mile outside a USA and rural low- stress pipelines less than 8\5/8\ inches in diameter that are located in or within one-half mile of a USA. The following table presents the estimates for the mileage affected by this rulemaking: Phase Two Eligible Mileage ------------------------------------------------------------------------ Miles Miles Pipeline diameter inside USA outside USA ------------------------------------------------------------------------ = 8\5/8\''................................... NA 840.6 ------------------------------------------------------------------------ Four sources of mileage data that provide varying levels of detail were analyzed to derive these final mileage estimates: The Regulatory Analysis for the low-stress phase 1 final rule by PHMSA published in August 2006. A survey of ope
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