Vinson & Elkins — Hazardous Materials Safety Interpretation

Page 1S. Departme Transportatic APR 6 2006 Washington, D.C. 20590 400 Seventh Street, S.W. Pipeline and Administration Hazardous Materials Safety Thomas H. Wilson Ref. No. 06-0049 Vinson & Elkins First City Tower Houston, TX 77002-6760 1001 Fannin Street, Suite 2300 Dear Mr. Wilson: This is in response to your January 3, 2006 letter and telephone conversation with a member of my staff requesting clarification regarding the applicability of the Hazardous Materials Regulations (HMR; 49 CFR Parts 171-180). In your scenario, your client has cylinders filled with a Division 2.2 non-flammable gas that is used to power a portable generator. You ask when the requirements of the HMR would apply to these cylinders. The HMR apply to transportation of hazardous materials in commerce. Transportation in commerce begins when a carrier takes physical possession of the filled cylinders for purposes of transporting them and continues until delivery of the cylinders to their destination as evidenced by the shipping documentation under which the filled cylinders are moving, such as shipping papers, bills of lading, freight orders, or similar documentation. The HMR also apply to pre-transportation functions such as selecting an authorized cylinder, marking and labeling, and preparation of the shipping papers. I hope this information is helpful. Sincerely, Hothe z. Michel Hattie L. Mitchell, Chief Regulatory Review and Reinvention Office of Hazardous Materials Standards WHIN 171./ 060049#

Page 2Saterthwaite 8171.1 Applicability Thomas H. Wilson twilson@velaw.com Tel 713.758.2042 Fax 713.615.5704 06-0049 January 3, 2006 VIA CMRRR #7003 3119 0033 1955 4957 Mr. Joseph Solomey Assistant Chief Counsel U.S. Department of Transportation A ll: Pipeline and Hazardous Materials Safety Administration Office of Chief Counsel CO 400 Seventh Street, SW Room 8417 Washington, DC 20590 Dear Mr. Solomey: On behalf of one of our clients, we request a written interpretation on the applicability of the federal hazardous materials transportation law, 49 U.S.C. § 5101 et seq. (formerly the Hazardous Materials Transportation Act (HMTA)), and! the Hazardous Materials Regulations, 49 C.F.R. Parts 171-180, to the use and refilling of compressed gas cylinders as described below. Our client is in the development stage of a new product that is intended for sale throughout the United States. The product uses compressed air to power a small turbine for mission-critical backup power systems. The client has two options at its disposal for refilling the gas cylinders, or 2) refill the gas cylinders using a compressor at the point of use. gas cylinders after a demand event: 1) call a local gas distributor and request replacement ot Our client believes, and we request your concurrence, that in order to use option 1, the cylinders must comply with the laws and regulations mentioned above. We also believe, and request your concurrence, that if our client's customers choose to refill their own gas cylinders as described herein meets the definition of transport cylinders and does not other words, we request agreement. with our opinion that the use and refilling of compressed constitute stationary storage. Vinson & Elkins LLP Attorneys at Law Austin Beijing Dallas Dubai Houston Lordon Moscow New Yark Shanghai Tokyo Washington First City Tower, 1001 Fannin Street, Suite 2300. Houston, TX 77002-6760 Tel 713.758.2222 Fax 713.758.2346 www.velaw.com#

Page 3Mr. Joseph Solomey January 3, 2006 Page 2 If you have any questions on this matter, please do not hesitate to contact me. Thank you in advance for your assistance in this matter. Thislich 2601707_1.DOC#