{"operation":"document","citation":"PI-24-0007","title":"Cowboy Pipeline Operators, LLC — Pipeline Safety Interpretation","source_type":"guidance","agency":"Pipeline and Hazardous Materials Safety Administration","status":"guidance","official":true,"published_on":"2024-12-10","effective_on":null,"summary":"PI-24-0007 response to Cowboy Pipeline Operators, LLC concerning 195.0.","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-interpretation-pi-24-0007.json","markdown":"https://regulus.evalyn.ai/document/phmsa-interpretation-pi-24-0007.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-interpretation-pi-24-0007","source_url":"https://www.phmsa.dot.gov/sites/phmsa.dot.gov/files/2024-12/Cowboy-Pipeline-PI-24-0007-12-10-2024-Part195.pdf","body":"<<<PAGE 1>>>\n\n1200 New Jersey Avenue, SE\nWashington, DC 20590\nU.S. Department\nof Transportation\nPipeline and Hazardous\nMaterials Safety Administration December 10, 2024\nMr. James D. Smith\nOwner/Manager\nCowboy Pipeline Operators, LLC\n550 Westcott Street, Suite 250\nHouston, TX 77007-6040\nDear Mr. Smith:\nIn a letter to the Railroad Commission of Texas (Commission) dated June 28, 2024, you\nrequested an interpretation of the federal pipeline safety regulations in 49 Code of Federal\nRegulations (CFR) Part 195 with respect to the scope of the part under § 195.0 for pipelines\ntransporting vinyl acetate monomer (VAM; chemical formula C₂H₆O₂) near Houston, Texas.\nSpecifically, you requested an interpretation of whether VAM is a regulated product as defined\nin § 195.2.\nYou specified that you are the pipeline operator and that you are following up on an informal\nrequest for interpretation from the Commission on behalf of Kuraray America, Inc. (KAI), the\nowner of the VAM pipelines. You mentioned that it was recommended to KAI that it make a\nformal request for an interpretation regarding the VAM pipelines.\nIn your letter, you described the VAM pipelines with the northernmost location being the “La\nPorte” plant, which produces most of the VAM. You discussed two more mid-line plants, the\n“POVAL and EVAL” plants, which both use VAM in the production of consumer products.\nYou stated the POVAL plant is approximately 1.5 miles north of the EVAL plant.\nYou discussed your method of producing VAM through the reaction of ethylene, acetic acid, and\noxygen to generate a finished product that is used as an intermediate for other products. You\nmentioned that ethylene, a hydrocarbon, and the pipelines providing the ethylene to the La Porte,\nEVAL, and POVAL plants are regulated by Part 195, including the KAI 2-inch ethylene\npipeline. You also stated that acetic acid and oxygen are not regulated products under Part 195\nand suggested that acetic acid pipelines are non-jurisdictional since their product is a carboxylic\nacid and not a hazardous liquid.\nYour letter offered several reasons in support of your position that VAM is not a regulated\ncommodity under Part 195. You argued that VAM does not meet the definition of a “hazardous\nliquid” under 49 CFR § 195.2. You stated that while VAM is flammable, it is primarily a\nchemical ingredient and not used as fuel. You contended that although VAM is both toxic and\nharmful to the environment, it is not petroleum, petroleum product, ammonia, ethanol, or non-\npetroleum fuel and, therefore, does not satisfy the first part of the definition of “hazardous\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 are not generally applicable, do not create legally-enforceable rights or\nobligations, and are provided to help the specific requestor understand how to comply with the regulations.\n\n<<<PAGE 2>>>\n\nPage 2 of 4\nliquid.” You mentioned that “harmful” is not defined in the pipeline safety regulations and\nsuggested that plenty of industrial chemicals that are toxic and harmful to the environment such\nas acetic acid and ethylene glycol are not regulated by the Pipeline and Hazardous Materials\nSafety Administration (PHMSA) because they are not petroleum products.\nYou also defined hydrocarbon as a compound “composed solely of hydrogen and carbon,” based\non the scientific definition and a 1996 interpretation issued by PHMSA,1 which determined that\na prior understanding2 of the meaning of “petroleum product” was too broad in light of the\nhistorical context of Part 195. You stated that PHMSA’s interpretation clarified that PHMSA\ndid not intend to expand the regulation of petroleum products. You indicated that KAI’s\npetrochemical products are acids and organic compounds produced though processing\nhydrocarbons and that further processing of the compounds as ingredients delineates\nhydrocarbons from petrochemical products.\nLastly, you suggested in your letter that because VAM is the end-product of the reaction between\ntwo unregulated and one regulated commodity, VAM is not regulated. You indicated that there\nhave been no previous interpretations or rulings regarding the regulation of VAM and that it\nreinforces your position that VAM was not intended to be regulated as a petroleum product\nunder Part 195. You inferred that VAM is instead a petrochemical product under PHMSA’s\ncharacterization of that term.\nThe applicable regulatory language is reprinted below.\n§ 195.0 Scope.\nThis part prescribes safety standards and reporting requirements for\npipeline facilities used in the transportation of hazardous liquids or carbon\ndioxide.\n§ 195.2 Definitions.\nHazardous liquid means petroleum, petroleum products, anhydrous\nammonia, and ethanol or other non-petroleum fuel, including biofuel,\nwhich is flammable, toxic, or would be harmful to the environment if\nreleased in significant quantities.\nPetroleum means crude oil, condensate, natural gasoline, natural gas\nliquids, and liquefied petroleum gas.\nPetroleum product means flammable, toxic, or corrosive products\nobtained from distilling and processing of crude oil, unfinished oils,\n1 Notice of Interpretation and Partial Stay of Enforcement: Petroleum Products and Low-stress Pipelines, PI-96-0101\n(May 3, 1996),\nhttps://www.phmsa.dot.gov/sites/phmsa.dot.gov/files/legacy/interpretations/Interpretation%20Files/Pipeline/1996/g\n96_05_03_ChiefPort_195.1_wmx.pdf (last accessed Sept. 3, 2024) [hereinafter 1996 Interpretation].\n2 See Letter to Hoechst Celanese Corporation, SR-95-086 (Sept. 12, 1995),\nhttps://www.phmsa.dot.gov/sites/phmsa.dot.gov/files/legacy/interpretations/Interpretation%20Files/Pipeline/1995/PI\n95038.pdf (last accessed Sept. 3, 2024).\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 are not generally applicable, do not create legally-enforceable rights or\nobligations, and are provided to help the specific requestor understand how to comply with the regulations.\n\n<<<PAGE 3>>>\n\nPage 3 of 4\nnatural gas liquids, blend stocks and other miscellaneous hydrocarbon\ncompounds.\nYou asked PHMSA the following question and PHMSA’s response follows.\nQuestion: Is vinyl acetate monomer (VAM) a “hazardous liquid” under\n49 CFR § 195.2?\nResponse:\nNo, VAM is not a “hazardous liquid” under § 195.2.3 A “hazardous liquid” means\npetroleum, petroleum products, anhydrous ammonia, and ethanol or other non-petroleum\nfuel, including biofuel, which is flammable, toxic, or would be harmful to the\nenvironment if released in significant quantities. First, VAM is not “petroleum” within\nthe meaning of § 195.2 because it is not “crude oil, condensate, natural gasoline, natural\ngas liquids, and liquefied petroleum gas.” Second, VAM is not anhydrous ammonia,\nethanol, or other non-petroleum fuel such as biofuel. Finally, PHMSA analyzed whether\nVAM is a “petroleum product” under § 195.2.\nSince Part 195 was codified in 1969 establishing the minimum federal safety standards\nfor the transportation of regulated liquids by pipeline, it has applied to the transportation\nof liquid petroleum products by pipeline. On June 28, 1994, PHMSA4 published a Final\nRule (1994 Final Rule) that adopted what is now the current definition of “petroleum\nproduct.”5 In 1996, PHMSA issued Interpretation PI-96-0101, referenced above, which\nclarified the meaning of “petroleum product” as the term was defined prior to and as\nadopted in the 1994 Final Rule. In the 1996 Interpretation, PHMSA provided examples\nof products—notably all hydrocarbons—that were included in the definition of\n“petroleum products,” including butane, propane, gasoline, heating oil, aviation fuel,\nkerosene, diesel fuel, and hydrocarbon feedstocks such as ethylene and propylene.\nPHMSA explained that prior to adopting a definition of “petroleum product” it had not\nconsidered the intermediate and finished products manufactured by processing\nhydrocarbon feedstock to be “petroleum products.” PHMSA clarified that such\n“petrochemical products,” made by chemical means and characterized by the addition of\nother chemicals to hydrocarbon feedstock, are not included in the definition of\n“petroleum product.” PHMSA further explained that petrochemical products made using\npetroleum products as raw material are not included in the definition of “petroleum\nproducts.”\nYou stated in your letter that you generate VAM by reacting a hydrocarbon feedstock and\nethylene with acetic acid and oxygen. VAM manufactured through the process you\ndescribed is a “petrochemical product” described by PHMSA in the 1996 Interpretation\n3 VAM is a flammable, clear, colorless liquid used to manufacture various other industrial products that can cause\nirritation to the eyes and respiratory system. Nat’l Libr. Of Med., Vinyl acetate,\nhttps://pubchem.ncbi.nlm.nih.gov/compound/Vinyl-acetate (last accessed Sept. 3, 2024).\n4 Previously, PHMSA was the Research and Special Programs Administration or “RSPA.”\n5 Regulatory Review: Hazardous Liquid and Carbon Dioxide Pipeline Safety Standards, 59 Fed. Reg. 33388, 33395\n(June 28, 1994)(codified at 49 C.F.R. pt. 195).\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 are not generally applicable, do not create legally-enforceable rights or\nobligations, and are provided to help the specific requestor understand how to comply with the regulations.\n\n<<<PAGE 4>>>\n\nPage 4 of 4\nbecause it is made by chemical means through the addition of chemicals (acetic acid and\noxygen) to a hydrocarbon feedstock (ethylene).\nTherefore, VAM is not a “petroleum product” within the meaning of § 195.2, and thus is\nnot a regulated “hazardous liquid” under the federal pipeline safety regulations.6\nAccordingly, transportation by pipeline of VAM is not regulated under Part 195. Due to\nVAM’s hazardous properties, PHMSA recommends that the pipeline operator consult\nwith applicable federal and state authorities to ensure compliance with any applicable\nregulations.\nIf we can be of further assistance, please contact Joe Berry at (720) 601-3577.\nSincerely,\nJohn A. Gale\nDirector, Office of Standards\nand Rulemaking\n6 Although VAM does not currently meet the definition of a hazardous liquid, 49 U.S.C. § 60101(a)(4)(C) authorizes\nPHMSA to determine that a substance is a hazardous liquid if it may pose an unreasonable risk to life or property\nwhen transported by a hazardous liquid pipeline facility in a liquid state.\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 are not generally applicable, do not create legally-enforceable rights or\nobligations, and are provided to help the specific requestor understand how to comply with the regulations.\n\n<<<PAGE 5>>>\n\nJune 28, 2024\nVIA E-MAIL: safety@rrc.texas.gov\nMs. Stephanie Weidman\nPipeline Safety Director\nRAILROAD COMMISSION OF TEXAS\n1701 North Congress Ave.\nAustin, TX 78711-2967\nRe: Request for Interpretation of Vinyl Acetate Monomer as Non-Jurisdictional |\nP-5 No. 478807 | T-4 Permit No. 09486 (KAI)\nDear Mrs. Weidman,\nCowboy Pipeline Operators, LLC. (CPO), through our consultant, Energy Services &\nSolutions, LLC. (EnServ), is following up on an informal request for interpretation on behalf of\nour client, Kuraray America, Inc. (KAI). Several years ago,1 it was determined during a special\ninspection that the Acetic Acid (AA) pipelines were not jurisdictional under 49 CFR 195 since AA\nis not a hazardous liquid. At that time, it was recommended that the KAI team follow up with a\nformal request for interpretation2 regarding the Vinyl Acetate Monomer (VAM) pipelines. During\na recent Integrity Management inspection,\n3 this topic resurfaced, so the purpose of this letter is to\nmake this formal request. For clarification, KAI is the Owner of the pipelines, while CPO is the\nOperator of the pipelines, with EnServ as a consultant for both. The KAI team reflects the\nundersigned representatives from all three companies.\nRegarding the VAM pipelines, the northernmost location is the “La Porte” plant which\nproduces most of the VAM. The “POVAL” and “EVAL” plants are mid-line plants that both use\nVAM in their production of consumer products,\n4/5 respectively. The POVAL plant is\napproximately 1.5 miles north of the EVAL plant. VAM’s empirical formula is C4H6O2, an organic\ncompound which is produced through the reaction of Ethylene, Acetic Acid, and Oxygen. Ethylene\nis certainly a hydrocarbon, and the pipelines providing it to the La Porte, EVAL, and POVAL\nplants are regulated by their respective owner/operators, including the KAI 2” Ethylene pipeline.\nHowever, Acetic Acid and Oxygen are not regulated products of Part 195. As mentioned above,\nthe AA pipelines are non-jurisdictional since their product is a carboxylic acid and not a hazardous\nliquid.\n49 CFR 195.26 has definitions for hazardous liquid, petroleum, and petroleum product.\nPetroleum and petroleum products are iterative definitions of hazardous liquid. Whether looking\nat them either independently or dependently, the KAI team concludes that VAM does not meet\nany or all of these definitions. Our primary point of view is that VAM should not be a regulated\nproduct as defined by 49 CFR 195.2 and previous interpretations under the basic premise that\nVAM is not a hazardous liquid.\nIn support of same, first, VAM is not a product listed as a hazardous liquid, i.e., petroleum,\npetroleum product, ammonia, ethanol, or non-petroleum fuel. While VAM is flammable, it is\nprimarily a chemical ingredient and not used as a fuel. Similarly, though it is considered toxic and\n\n<<<PAGE 6>>>\n\n“harmful” to the environment, both of these are predicated on VAM being a regulated product by\nthe first half of the definition. Plenty of industrial chemicals are still unregulated which are\nconsidered toxic and “harmful,” such as AA or Ethylene Glycol (C2H6O2) because they are not\nconsidered petroleum products. Note that “harmful” is not defined by any part of the Code, either\nin the preamble or by interpretation.\nSecond, as established above, VAM is not a hydrocarbon. By the scientific definition and\nPHMSA interpretation,\n7 a hydrocarbon is a compound “composed solely of hydrogen and carbon.”\nThe interpretation rescinded its ruling against Hoechst Celanese Corporation because the decision\nwas too broad.\n8 Both Hoechst Celanese Corporation’s and KAI’s petrochemical products are acids\nand organic compounds and are produced through the processing of hydrocarbons, such that the\nfurther processing of the compounds as ingredients delineates between hydrocarbon compounds\nand petrochemical compounds.\nFinally, since VAM is the end-product of the reaction of two unregulated products and one\nregulated product, it stands to reason that VAM is not regulated. The same interpretation8 that\nidentifies regulated petroleum products further clarified that it was not PHMSA’s intent to expand\nthe regulation of petroleum products, only to clarify. Since there have been no previous\ninterpretations or rulings known to the KAI team of the regulation of VAM before or after this\nFinal Rule and Interpretation, it reinforces the KAI team’s stance that VAM was never intended\nto be recognized as a regulated petroleum product; instead as a “petrochemical product” by\nPHMSA’s characterization of the term. VAM uses hydrocarbon feedstock (ethylene) and further\nprocessing of additional chemicals (AA and oxygen) to generate a finished product—VAM—to\nbe used as an intermediate for other products.\nWe trust that the Railroad Commission of Texas understands the KAI team’s position and\nwill provide a formal interpretation consistent with KAI’s argument herein. The KAI team is\nwilling and available to provide additional information, as necessary, in order to fulfill the request\nfor interpretation of VAM’s jurisdictional status. Please feel free to contact the undersigned at your\nconvenience.\nSincerely,\nJames D. Smith\nJames D. Smith\nOwner/Manager\nCowboy Pipeline Operators, LLC\n713-652-3299\nJim@CPOperators.com\n\n<<<PAGE 7>>>\n\ncc:\nJose “Chevy” Cheverez\nIntegrity Director\nEnergy Services & Solutions, LLC\n682-597-1436\nchevy@enservsolutions.com\nRandy Wilson\nVAM Senior Specialist\nKuraray / Vinyls\n832.568.8501\nRandy.Wilson@kuraray.com\nMr. Alan K. Mayberry\nAssociate Administrator for Pipeline Safety\nPIPELINE SAFETY, PIPELINE AND HAZARDOUS\nMATERIALS SAFETY ADMINISTRATION\n1200 New Jersey Avenue, SE., East Building\nWashington, DC 20590\nVIA E-MAIL: Alan.Mayberry@dot.gov\nVIA E-MAIL: phmsa.pipelinesafety@dot.gov\nVIA FAX: 202-366-4566\n\n<<<PAGE 8>>>\n\n1. 2. 3. 4. 5. 6. 7. 8. Appendix A – References\nRRC Inspection – INSPPKG-0000070491 (formerly IP# 129435), Jan 28 – Feb 03, 2021.\nEmail Correspondence – Subject: “acetic acid and VAM (vinyl acetate),” dated May 22,\n2019.\nRRC Inspection – INSPPKG-0000090112, Jun 05-07, 2023.\nEVALTM is KAI’s product for its line of Ethylene Vinyl-Alcohol Polymers, an air-tight\npolymer used for packaging, storing, or lining a variety of food, chemical, cosmetic, and\npharmaceutical products. https://kuraray.us.com/products/polymers/kuraray-eval/\nPOVALTM, also known as ELVANOLTM, is KAI’s product for its line of Polyvinyl Alcohol\nresins. The product’s characteristics are ideal for film formation, emulsifying power, and\nadhesion to substrates making the product ideal for producing adhesives, specialty papers,\ngas-tight barriers, textiles, injection molding, and many other industrial applications.\nhttps://kuraray.us.com/products/polymers/kuraray-poval-elvanol/\n49 CFR 195.2 Definitions. https://www.ecfr.gov/current/title-49/subtitle-B/chapter-\nI/subchapter-D/part-195/subpart-A/section-195.2\na. Hazardous liquid means petroleum, petroleum products, anhydrous ammonia, and\nethanol or other non-petroleum fuel, including biofuel, which is flammable, toxic,\nor would be harmful to the environment if released in significant quantities.\nPetroleum means crude oil, condensate, natural gasoline, natural gas liquids, and\nliquefied petroleum gas.\nPetroleum Product means flammable, toxic, or corrosive products obtained from\ndistilling and processing of crude oil, unfinished oils, natural gas liquids, blend\nstocks and other miscellaneous hydrocarbon compounds.\nInterpretation Response #PI-96-0101 (May 03, 1996) -\nhttps://www7.phmsa.dot.gov/sites/phmsa.dot.gov/files/legacy/interpretations/Interpretatio\nn%20Files/Pipeline/1996/g96_05_03_ChiefPort_195.1_wmx.pdf\nInterpretation PI-95-038 (September 12, 1995) -\nhttps://www.phmsa.dot.gov/sites/phmsa.dot.gov/files/legacy/interpretations/Interpretation\n%20Files/Pipeline/1995/PI95038.pdf\nb. c.","truncated":false,"body_characters":19639}