{"operation":"document","citation":"PI-21-0002","title":"High Roller E&C, LLC — Pipeline Safety Interpretation","source_type":"guidance","agency":"Pipeline and Hazardous Materials Safety Administration","status":"guidance","official":true,"published_on":"2021-06-02","effective_on":null,"summary":"PI-21-0002 response to High Roller E&C, LLC concerning 193.2001.","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-interpretation-pi-21-0002.json","markdown":"https://regulus.evalyn.ai/document/phmsa-interpretation-pi-21-0002.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-interpretation-pi-21-0002","source_url":"https://www.phmsa.dot.gov/sites/phmsa.dot.gov/files/docs/standards-rulemaking/hazmat/interpretations/75121/high-roller-ec-llc-pi-21-0002-06-92-2021-part1932001.pdf","body":"<<>>\n\nU.S. Department\nof Transportation\nPipeline and Hazardous\nMaterials Safety Administration June 2, 2021\n1200 New Jersey Avenue, SE\nWashington, DC 20590\nMr. Rob Harman\nPresident\nHigh Roller E&C, LLC\n1008 Southview Circle\nCenter, Texas 75935\nDear Mr. Harman:\nOn January 7, 2021, in an email to the Pipeline and Hazardous Materials Safety Administration\n(PHMSA), you requested an interpretation of 49 CFR Part 193. Specifically, you requested an\ninterpretation regarding the applicability of Part 193 to mobile liquefaction facilities.\nIn your interpretation request, you stated that High Roller E&C, LLC (HREPC) is designing a\n15,000 gallon per day trailer mounted liquefaction plant that provides all the necessary means to\nclean and liquefy natural gas. You stated the liquefied natural gas (LNG) produced on this\nmobile trailer will fill LNG International Organization for Standardization (ISO) containers\nand/or LNG tankers and “will not be stored in permanent storage.”\nYour request presented the following questions1:\nQuestion 1: Please verify that the design and operation of a mobile LNG liquefication plant\nconnected to a 49 CFR Part 192 pipeline is governed by 49 CFR 193.2019.\nQuestion 2.A: Please verify that the only exception to Question 1 would be in situations where\nthe end user of the LNG (i.e., ultimate consumer) was also the producer of the LNG. For\nexample, if a crude oil drilling company leased the mobile LNG plant, connected it to a Part 192\npipeline, and produced LNG for its sole use, it would not be subject to 49 CFR Part 193.\nQuestion 2.B: Can the ultimate consumer truck the LNG from the production site, across public\nroadways, to a drilling site?\nQuestion 3.A: Please verify that when the mobile LNG liquefication plant is NOT connected to\na 49 CFR Part 192 pipeline, the design and operation is governed by NFPA 59A 2019.\nQuestion 3.B: Please confirm that if the mobile LNG liquefaction plant will be in operation for\nless than 180 days, the design and operation are governed by Chapter 14 of NFPA 59A 2019.\n1 Modified slightly for readability.\nThe Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety provides written clarifications of the Regulations (49 CFR\nParts 190-199) in the form of interpretation letters. These letters reflect the agency's current application of the regulations to the specific facts\npresented by the person requesting the clarification. Interpretations do not create legally-enforceable rights or obligations and are provided to\nhelp the public understand how to comply with the regulations.\n\n<<>>\n\n2\nQuestion 3.C: Please confirm that if the mobile LNG liquefaction plant will be in service for\nmore than 180 days then the design is governed by Chapter 17 of NFPA 59A 2019, unless the\nauthority having jurisdiction grants approval for an extension beyond 180 days.\nOn January 27, 2021, PHMSA sought clarification from HREPC regarding Question 2.B and\nposed the following three questions: 1) How does the ultimate consumer use the LNG at the\ndrilling site?; 2) Where does the ultimate consumer obtain gas to produce the LNG?; and 3) Is\nthe LNG that is trucked to a drilling site connected to a Part 192 pipeline?\nConcerning PHMSA’s first follow-up question, HREPC stated that the ultimate consumer will be\nvaporizing LNG and consuming gas at the drilling site. HREPC stated that the gas will be used\nin generator sets and/or natural gas engines. Regarding PHMSA’s second follow-up question,\nHREPC explained that the ultimate consumer may obtain natural gas from a local gathering\nsystem collecting wellhead gas, directly from a wellhead, or from a Part 192 pipeline. HREPC\nalso noted that the ultimate consumer may or may not own the property where the equipment is\nsetup. With respect to PHMSA’s third follow-up question, HREPC explained that it is not\nvaporizing LNG for reinjection into a pipeline. Lastly, HREPC noted that it is not just focused\non drilling sites, stating “the ultimate consumer may be a mine, a small power generation facility,\na factory, etc. The ultimate consumer will be buying gas from the supplier or the ultimate\nconsumer may own the gas. They may own the liquefaction equipment outright or they may be\nleasing it.”\nOn February 26, 2021, PHMSA asked two additional follow-up questions: 4) How long is the\nmobile LNG facility used at a time and what is the frequency of the use?; and 5) Is the mobile\nLNG facility removed entirely from the site after each use? HREPC responded that the mobile\nLNG facility may be used to produce LNG for a period of less than six months and produce 24/7\nduring that time, or they may be set up to produce LNG over a period of several years and\nproduction may be sporadic. With respect to PHMSA’s second follow up question, HREPC\nindicated that the LNG facility “may be removed, disassembled/disconnected and stored onsite,\nor moved offsite.”\nWith the facts above, PHMSA’s responses are as follows:\nQuestion 1: Please verify that the design and operation of a mobile LNG liquefication plant\nconnected to a 49 CFR Part 192 pipeline is governed by 49 CFR 193.2019.\nResponse to Question 1: Section 193.2001 specifies that LNG facilities used in the\ntransportation of gas by pipeline that is subject to the pipeline safety laws (49 U.S.C.\n60101 et seq.) and 49 CFR Part 192 must comply with the safety standards prescribed in\nPart 193. Section 193.2019 prescribes regulations specifically for mobile and\ntemporary LNG facilities. Section 193.2019 states, in relevant part, that “[m]obile and\ntemporary LNG facilities for peak-shaving application, for service maintenance during\ngas pipeline systems repair/alteration, or for other short term applications need not meet\nthe requirements of this part if the facilities are in compliance with applicable sections\nof NFPA-59A-2001 (incorporated by reference, see § 193.2013).” “[O]ther short term\nThe Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety provides written clarifications of the Regulations\n(49 CFR Parts 190-199) in the form of interpretation letters. These letters reflect the agency's current application of the regulations to the\nspecific facts presented by the person requesting the clarification. Interpretations do not create legally-enforceable rights or obligations and\nare provided to help the public understand how to comply with the regulations.\n\n<<>>\n\n3\napplications” is not defined in the Pipeline Safety Regulations (PSRs), rather the PSRs\nprovides two mobile and temporary uses that serve as guidance for other uses: 1) peak-\nshaving application and 2) service maintenance during pipeline systems\nrepair/alternation.\nMobile and temporary peak-shaving applications are typically used to support utility\npower providers during peak demand for a few hours to a few days. Whereas, mobile\nand temporary LNG facilities used for service maintenance during pipeline system\nrepair/alteration may be in use for a few weeks to a few months depending on the\ncomplexity of the repair. Therefore, if HREPC’s mobile LNG facility will be used for\nsimilar purposes and will be removed, disassembled/disconnected and stored onsite, or\nmoved offsite after use, then that facility would be governed by § 193.2019 because that\nproposed use is similar in mobility and duration to the examples provided in the\nregulation. However, if the LNG facility will be set up to produce LNG for permanent\nuse, even if production is sporadic, that type of use and duration would not be governed\nby § 193.2019, because such a facility would be dissimilar to the examples provided in\n§ 193.2019.\nQuestion 2.A: Please verify that the only exception to Question 1 would be in situations where\nthe end user of the LNG (i.e., ultimate consumer) was also the producer of the LNG. For\nexample, if a crude oil drilling company leased the mobile LNG plant, connected it to a Part 192\npipeline, and produced LNG for its sole use, it would not be subject to 49 CFR Part 193.\nResponse to Question 2.A: Section 193.2001(a) states that “[Part 193] prescribes safety\nstandards for LNG facilities used in the transportation of gas by pipeline that is subject to\nthe pipeline safety laws (49 U.S.C. 60101 et seq) and Part 192 of this chapter.” Section\n193.2001(b)(1) provides an exception to 193.2001(a), stating that “LNG facilities used by\nultimate consumers of LNG or natural gas” are not subject to Part 193.\nThe “ultimate consumer” provision provides a very limited exemption from 49 CFR Part\n193. In a previous interpretation, PHMSA explained:\nDuring the rulemaking that led to the adoption of § 193.2001(b)(1), OPS\nexplained that the intent of that provision was to create an exception for\n\"an LNG facility used by the ultimate consumer of the product\".\nLikewise, in responding to a series of questions from a congressional\ncommittee, OPS stated that the exception in § 193.2001(b)(1), was\ndesigned for \"small\" facilities which are \"generally located in industrial\nplants ... [to] serve as a supply of energy or feedstock for the plant.\"\nUnlike these examples, the Maine LMF facilities would be used to\nproduce LNG for sale and distribution by truck, not solely for onsite\nconsumption. Therefore, OPS concludes that your client's facilities would\nnot qualify for the end-user exception in § 193.2001(b)(1).2\n2 Maine Liquid Methane Fuels, LLC, Request for Interpretation of 49 CFR 193.2001, PHMSA interpretation # PI-\n10-0025, available at https://cms7.phmsa.dot.gov/regulations/title49/interp/PI-10-0025.\nThe Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety provides written clarifications of the Regulations\n(49 CFR Parts 190-199) in the form of interpretation letters. These letters reflect the agency's current application of the regulations to the\nspecific facts presented by the person requesting the clarification. Interpretations do not create legally-enforceable rights or obligations and\nare provided to help the public understand how to comply with the regulations.\n\n<<>>\n\n4\nBased on the limited facts provided in your question, if the ultimate consumer connected\nthe HREPC mobile LNG facility to a Part 192 pipeline and proceeded to produce LNG\nfor its sole use and consumption on-site, it would not be subject to 49 CFR Part 193.\nQuestion 2.B: Can the ultimate consumer truck the LNG from the production site, across public\nroadways, to the drilling site?\nResponse to Question 2.B: As noted above, the ultimate consumer exception of\n§ 193.2001(b)(1) is very narrow and was meant to encompass \"small\" facilities which are\n\"generally located in industrial plants ... [to] serve as a supply of energy or feedstock for\nthe plant.\" Importantly, PHMSA’s previous interpretation provided to Maine Liquid\nMethane Fuels, LLC, highlights “on-site consumption” as a factor for consideration when\ndetermining if a use qualifies for the end-user exception in § 193.2001(b)(1).3\nThe example provided by HREPC indicates that the ultimate consumer would be trucking\nthe LNG off-site and crossing public roads – roads that are not within the ultimate\nconsumer’s legal control. Trucking LNG across public roads for off-site consumption is\nsimilar to the type of activities PHMSA has already determined to be outside of the end-\nuser exception4\n. Therefore, PHMSA concludes that the proposed use, as described by the\nlimited facts provided, would not qualify HREPC for the end-user exception in\n§ 193.2001(b)(1).\nQuestion 3.A: Please verify that when the mobile LNG liquefaction plant is NOT connected to a\n49 CFR Part 192 pipeline, the design and operation is governed by NFPA 59A 2019.\nResponse to Question 3.A: As noted above, § 193.2001(a) states that “[Part 193]\nprescribes safety standards for LNG facilities used in the transportation of gas by pipeline\nthat is subject to the pipeline safety laws (49 U.S.C. 60101 et seq.) and Part 192 of this\nchapter.” For mobile LNG liquefaction plants not covered by Part 193, PHMSA cannot\ncomment on whether any other standards may be applicable to those facilities.\nQuestion 3.B: If the mobile LNG liquefaction plant will be in operation for less than 180 days\nthen the design and operation are governed by Chapter 14 of NFPA 59A 2019.\nResponse to Question 3.B: Please see PHMSA’s response to Question 3.A. In addition,\ncurrently, Part 193 incorporates by reference the 2001 edition of NFPA 59A (see §\n193.2013).\n3 Id.\n4 Maine Liquid Methane Fuels, LLC, Request for Interpretation of 49 CFR 193.2001, PHMSA interpretation # PI-\n10-0025, available at https://cms7.phmsa.dot.gov/regulations/title49/interp/PI-10-0025.\nThe Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety provides written clarifications of the Regulations\n(49 CFR Parts 190-199) in the form of interpretation letters. These letters reflect the agency's current application of the regulations to the\nspecific facts presented by the person requesting the clarification. Interpretations do not create legally-enforceable rights or obligations and\nare provided to help the public understand how to comply with the regulations.\n\n<<>>\n\nQuestion 3.C: If the mobile LNG liquefaction plant will be in service for more than 180 days\nthen the design is governed by Chapter 17 of NFPA 59A 2019 unless the authority having\njurisdiction grants approval for an extension beyond 180 days.\nResponse to Question 3.C: Please see PHMSA’s response to Question 3.A. Again,\ncurrently, Part 193 incorporates by reference the 2001 edition of NFPA 59A.\nIf we can be of further assistance, please contact Tewabe Asebe at 202-366-5523.\nSincerely,\nJohn A. Gale\nDirector, Office of Standards\nand Rulemaking\nThe Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety provides written clarifications of the Regulations (49 CFR\nParts 190-199) in the form of interpretation letters. These letters reflect the agency's current application of the regulations to the specific facts\npresented by the person requesting the clarification. Interpretations do not create legally-enforceable rights or obligations and are provided to\nhelp the public understand how to comply with the regulations.\n\n<<>>\n\nI found a typo…our system is 15,000 gallon per day. (not 1500)\nFrom: Rob Harman \nSent: Thursday, January 07, 2021 10:36 AM\nTo: White, Sentho (PHMSA) \nCc: Ravi Vemulapalli ; Kieba, Max (PHMSA) ; Prothro II, James\n(PHMSA) ; Asebe, Tewabe (PHMSA) \nSubject: RE: Request for Interpretation - Mobile Liquefaction Facility\nAll-\nRob\nMs. White:\nHigh Roller E&C, LLC (HREPC) respectfully submits this Request for Interpretation from the Pipeline and\nHazardous Materials Safety Administration (PHMSA) Office of Pipeline Safety to determine the\napplicability of 49CFR193 to mobile liquefaction facilities. HREPC is designing a 15,00 gallon per day\ntrailer mounted liquefaction plant that provides all the necessary means to clean and liquify natural\ngas. The LNG produced on these mobile trailers will fill LNG ISO containers and /or LNG tankers. LNG\nwill not be stored in permanent storage.\nQ1: Please verify that if the mobile LNG Liquification plant is connected to a CFR192 pipeline then\nthe design and operation is governed by CFR193 section 2019.\nQ2: Please verify that the only exception to Q1 above would be in situations where the end user of\nthe LNG was also the producer (ultimate user). In other words a Crude Oil Drilling company leases\nthe mobile LNG plant, connects it to a 192 pipeline, produces LNG for its sole use. In other words\nCFR193 is NOT applicable.\n-Q2 part B: Can the Ultimate User truck the LNG from the production site, across public\nroadways, to the drilling site.\nQ3: Please verify that when the mobile LNG Liquification plant is NOT connected to a CFR192\npipeline then the design and operation is governed by NFPA59A 2019.\nQ3 Part B: If the mobile LNG Liquefaction plant will be in operation for less than 180 days then\nthe design and operation are governed by Chapter 14 of NFPA 59A 2019.\nQ3 Part C: If the mobile LNG Liquefaction plant will be in service for more than 180 days then\nthe design is governed by Chapter 17 of NFPA 59A 2019 unless the AHJ grants approval for an extension\nbeyond 180 days.\nRespectfully,\nRobert Harman","truncated":false,"body_characters":16384}