U.S.DOT/PHMSA - Final Environmental Assessment and Finding of No Significant Impact for Implementation Modifications and Clarifications

Page 1U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Final Environmental Assessment and Finding of No Significant Impact For Implementation of the Final Rule For PIPELINE SAFETY: INTEGRITY MANAGEMENT PROGRAM MODIFICATIONS AND CLARIFICATIONS [Docket No. PHMSA-04-18938] August 2006 Prepared for: Office of Pipeline Safety Pipeline and Hazardous Materials Safety Administration Prepared by: Environmental Engineering Division John A. Volpe National Transportation Systems Center Research and Innovative Technology Administration#

Page 2TABLE OF CONTENTS TABLE OF CONTENTS I LIST OF ACRONYMS 1.0 PURPOSE AND NEED FOR ACTION 11 1.2 1.1 INTRODUCTION 1-2 1-1 BACKGROUND Statutory and Regulatory Requirements 1-2 1-2 1-2 1.3 PURPOSE AND NEED FOR ACTION Hazardous Liquid IMP 1-3 Flexibility in Reassessment Interval 1-4 1-3 Notification Requirements for Pressure Reductions Exceeded 365 Days Correcting Pressure Reduction Formula Requirements 1-4 1.4 1.5 PUBLIC INVOLVEMENT 1-6 1-5 SCOPE OF ANALYSIS 2.0 PROPOSED ACTION AND ALTERNATIVES 2-1 2.1 2.2 OVERVIEW OF ALTERNATIVES 2-1 2.3 ALTERNATIVES DEVELOPMENT PROCESS 2-1 NO ACTION ALTERNATIVE 2-1 2.4 PROPOSED ACTION ALTERNATIVE 2-35 2.5 ALTERNATIVE A (NRPM PROPOSAL) 2-3 2-2 2.6 COMPARISON OF THE ALTERNATIVES 2-4 3.0 AFFECTED ENVIRONMENT AND ENVIRONMENTAL CONSEQUENCES 3-6 ENVIRONMENTAL CONSEQUENCES AFFECTED ENVIRONMENT 3-7 3-6 3.2.2 Hazardous Materials Transportation Public Health and Safety 3-7 3-8 3.2.3 Socioeconomics 3-8 3.3 3.2.4 Special Areas of Consideration FINDING OF NO SIGNIFICANT IMPACT 3-6 3-9 4.0 LIST OF PERSONS CONSULTED 4-1 5.0 LIST OF PREPARERS AND REVIEWERS 41 6.0 REFERENCES 4-1 August 2006#

Page 3LIST OF ACRONYMS API American Petroleum Institute AOPL Association of Oil Pipelines CEQ Council on Environmental Qualit CFR lode of Federal Regulations DOT United States Department of Transportation EA Environmental Assessment EFRD Emergency Flow Restricting Devices FONSI 'inding of No Significant Impact FR Federal Register HCA High Consequence Area IMP ntegrity Management Prograr NEPA lational Environmental Policy Ar NGL Vatural Gas Liquids NHPA Jational Historic Preservation Ac NPRM Notice of Proposed Rulemaking NTSB National Transportation Safety Board OPS Office of Pipeline Safety PHMSA Pipeline and Hazardous Materials Safety Administration U.S. United States U.S.C. United States Code August 2006 ii#

Page 41.0 PURPOSE AND NEED FOR ACTION 1.1 INTRODUCTION The Pipeline and Hazardous Materials Safety Administration (PHMSA) proposes to implement a final rule concerning revisions to the current pipeline safety regulations for pipeline integrity management in high consequence areas. The revisions promote PHMSA's mission to ensure safe, reliable, and environmentally sound operation of the Nation's pipeline transportation system. The revised regulations are Title 49 of the Code of Federal Regulations (CFR) Part 192, Gas Transmission Pipelines, and Part 195, Hazardous Liquid Operators. The final rule, entitled "Pipeline Safety: Integrity Management Program Modifications and Clarifications," will: • allow more flexibility in the reassessment interval for hazardous liquid pipelines by adding an eight-month window to the established five-year time frame for operators to complete reassessments; • add a requirement to include notifying PHMSA with reasons for repair delay when a pressure reduction exceeds 365 days; • correct existing provisions for calculating pressure reductions when making immediate repairs on a hazardous liquid pipeline. The proposed correction will allow operators the use of another acceptable method for calculating reduced operating pressure when the specified formula is not applicable, or results in a calculated pressure higher than the operating pressure; and, • Remove a requirement for gas operators to notify local authorities. There are no local authorities over these lines. PHMSA, with the cooperation of the John A. Volpe National Transportation Systems Center (Volpe Center), prepared this final environmental assessment (EA) and finding of no significant impact (FONSI) in accordance with the National Environmental Policy Act (NEPA) of 1969 (42 U.S.C. § 4321 et seq.), the Council on Environmental Quality's (CEQ) implementing regulations (40 CFR § 1500 et seq.), and the United States Department of Transportation (DOT) Order 5610.1C, Procedures for Considering Environmental Impacts. In this EA, PHMSA shares its analysis of the potential environmental impacts associated with the implementation of the final rule. August 2006 1-1#

Page 51.2 BACKGROUND 1.2.1 Statutory and Regulatory Requirements PHMSA has broad authority under 49 USC 60102 to issue regulations applying to the design, installation, inspection, emergency plans and procedures, testing, construction, extension, operation, replacement, and maintenance of pipeline facilities Both the natural gas and hazardous liquid integrity management program (IMP) regulations (49 CFR Part 192, Subpart O and Part 195.452 respectively) require operators to continually assess, evaluate, repair, and validate through comprehensive analysis the integrity of pipeline segments in places where a leak or rupture would do the most damage, such as populated and environmentally sensitive areas. These areas are called "High Consequence Areas" (HCAS). 1.2.2 Gas Integrity Management Program The natural gas IMP regulations apply to gas transmission pipelines located in HCAs. A gas HCA is defined by either of two methods: (a) a Class 3 or 4 location and any area outside a Class 3 or 4 location where the Potential Impact Radius is greater than 660 feet (200 meters), and the area within a Potential Impact Circle contains 20 or more buildings intended for human occupancy; or (b) an identified site, which is an area meeting one of three sub-criteria: • an outside area or open structure that is occupied by 20 or more people at least 50 days a year (the days need not be consecutive); • a building that is occupied by 20 or more people on at least 5 days a week for 10 weeks in a year (the days and weeks need not be consecutive); or, • the area within a potential impact circle containing 20 or more buildings intended for human occupancy, (unless the exception described above in method (a) applies). Gas transmission operators must complete a baseline assessment and conduct continual integrity assessment of the pipeline segments in HAs and address all anomalous conditions discovered from the assessment. An operator must remediate the anomalies according to a schedule that prioritizes the conditions for evaluation and remediation. Time frames are specified for certain conditions. These conditions are categorized as immediate, one-year, or monitored conditions. 1.2.3 Hazardous Liquid Integrity Management Program The hazardous liquid IMP regulations apply to any hazardous liquid or carbon dioxide pipeline that could affect a HCA. Hazardous liquid HAs are defined as populated areas, areas unusually sensitive to environmental damage, and commercially navigable waterways. Among other requirements, these regulations require operators to conduct a baseline assessment and then to periodically assess the integrity of each pipeline segment that could affect a HCA. Operators must also remediate anomalous conditions August 2006 1-2#

Page 6discovered from these assessments. Each operator is to have a schedule for the evaluation and remediation of anomalous conditions discovered. For certain conditions, the regulations prescribe the time frames for an operator to complete the remediation of the defect. These conditions are categorized into either immediate, 60-day, or 180-day repair conditions. 1.3 PURPOSE AND NEED FOR ACTION On June 18, 2004, the American Petroleum Institute and the Association of Oil Pipe Lines (API/AOPL) petitioned PHMSA for changes to the hazardous liquid pipeline IMP 'egulations (PHMSA 200Sa). The petition sought several changes, including the following (1) adding flexibility to the reassessment intervals, (2) adding flexibility to scheduling repairs; and, (3) providing notification of operators' inability to make repairs due to permitting or other problems. In accordance with 49 U.S.C. 60109(b) pipeline safety standards are required to be practicable and designed to meet the need for environmental safety and protection. Accordingly, PHMSA considered the API/AOPL petition in this respect and met with API/AOPL representatives on August 27, 2004, to further discuss the proposed changes. A meeting summary is contained in the docket. PHMSA agreed that certain measures proposed by the API/AOPL were practical and added operator flexibility while still meeting the need for environmental safety and protection. In addition, PHMSA has identified other potential changes to the IMP regulations that meet the need for environmental safety and protection including: 1) a need for more information from the liquid and gas pipeline operators on repair delays when a pressure exceeds 365 days; and, 2) a need to modify how the current pressure calculation formula is required to be used (American Society of Mechanical Engineers and American National Standards Institute standard B31.4 (ASME/ANSI B31.4)) for hazardous liquid operators, as it does not always apply and may result in a calculated pressure higher than the original operating pressure. As a result, the final rule will change the IMP regulations at 49 CFR Part 192, Subpart O and Part 195.452 respectively. The rationale and/or need for each of these elements is discussed in this section. 1.3.1 Flexibility in Reassessment Interval To maintain a pipeline's integrity, § 195.452(i) requires a continual process of evaluation and assessment of each hazardous liquid pipeline segment that could affect an HCA. August 2006 1-3#

Page 7Under § 195.452(j)(3), an operator is required to establish intervals not to exceed five years for continually assessing the pipe's integrity. The final rule will allow the reassessment interval to expand from "five years" to "five years not to exceed 68 months." Adding a window of time to complete the reassessment is necessary to allow operators some flexibility when having to factor in events impacting the reassessment (such as weather conditions, scheduling difficulties in getting certain tools, life cycle activities of species, and permitting problems). The expanded interval would be consistent with other pipeline safety regulations specifying time frames for completing required activities, and would not compromise pipeline safety. This change is consistent with other pipeline safety regulations that specify time frames for an operator to complete an inspection. 1.3.2 Notification Requirements For Pressure Reductions Exceeding 365 Days Both the current gas IMP and liquid IMP remediation requirements (§192.933 and §195.452(h)) require an operator to temporarily reduce pressure or to shut down the pipeline until the operator completes the repair of an immediate repair condition. Gas operators are also required to reduce pressure if they cannot meet a specified time limit for making a repair, or to take other action to ensure the safety of the segment. Notification is currently not required when an operator reduces pressure. Notification is required when an operator cannot meet its schedule for evaluating and remediating any condition and cannot provide safety though a temporary reduction in operating pressure. Any pressure reduction longer than 365 days must be justified The final rule will revise the remediation requirements to require both gas and hazardous liquid operators to notify PHMSA with reasons for repair delays when pressure reduction exceeds 365 days. Operators will still be required to take further remedial action to ensure the safety of the pipeline when pressure reduction exceeds 365 days. These notifications will allow PHMSA to become aware of situations in which delays to required repairs extend for long periods. Each such situation can then be examined on its own merits to determine if additional regulatory action is appropriate. 1.3.3 Correcting Pressure Reduction Formula Requirements Currently, Section 195.452(h)(4) requires an operator to calculate a temporary reduction in operating pressure using the formula in section 451.7 of ASME/ANSI B31.4 when making an immediate repair. The requirement was meant to ensure that an additional recent frequently asked question highlighted that this formula does not always apply and safety margin be provided while an operator makes an immediate repair. However, a may result in a calculated pressure higher than the original operating pressure. Moreover, the formula only applies to metal loss anomalies, not to immediate repair conditions not involving metal loss. August 2006 1-4#

Page 8The final rule will correct the provision by allowing a hazardous liquid pipeline operator to use the ASME/ANSI B31.4 formula only if applicable. If not applicable to the type of anomaly, or if the formula results in a calculated pressure higher than the original operating pressure, an operator would be allowed to use another acceptable means to calculate pressure reduction. 1.4 PUBLIC INVOLVEMENT Public involvement is a critical aspect of the NEPA process. As such, PHMSA must consider any comments received from the public and any comments and recommendations of the Technical Pipeline Safety Standards Committee and other relevant stakeholders. A Notice of Propose Rulemaking (NPRM) entitled; Integrity Management: Program Modifications and Clarifications-Request for Comments was published in the Federal Register (FR) on Thursday, December 15, 2005. Interested individuals were invited to submit comments on the NPRM by February 13, 2006. The NPRM referenced the EA in the docket and stated that PHMSA had preliminarily determined that the proposed action would not significantly affect the quality of the human environment. The NPRM and Draft EA identified the following proposed modifications and clarifications for consideration: • allow more flexibility in the reassessment interval for hazardous liquid pipelines by adding an eight-month window to the established five-year time frame for operators to complete reassessments; require both hazardous liquid and natural gas pipeline operators to notify PHMSA whenever they reduce pipeline pressure to make a repair and to provide reasons for pressure reduction; add a requirement to include notifying PHMSA with reasons for repair delay when a pressure reduction exceeds 365 days; and, correct the existing provision for calculating pressure reductions when making immediate repairs on a hazardous liquid pipeline. The proposed correction allows operators the use of another acceptable method for calculating reduced operating pressure when the specified formula is not applicable, or results in a calculated pressure higher than the operating pressure. • Remove a requirement for gas operators to notify local authorities. There are no local authorities over these lines. August 2006 1-5#

Page 9There were no comments received specific to the Draft EA. Several comments were received in response to the NPRM from gas and hazardous liquid pipeline operators or associations representing the industry including: The American Gas Association; Texas Pipeline Association; Kinder Morgan Energy Partners; Southwest Gas Corporation; Paiute Pipeline Company; Orange and Rockland Utilities, Inc.; Duke Energy Gas Transmission Corporation; American Petroleum Institute/Association of Oil Pipe Lines; Magellan Midstream Partners; Panhandle Energy; Puget Sound Energy; Enbridge Energy Company, Inc; and Atmos Energy Corporation. Most of the comments were in response to the technical aspects of the NPRM changes (in particular the additional reporting requirements) and not the environmental impacts of the changes. These comments will all be summarized in the final rule that will be published in the FR. In addition, on June 28, 2006, during joint meetings of the Technical Hazardous Liquid Pipeline Safety Standards Committee, the Technical Pipeline Safety Standards of the requirement that gas and hazardous liquid operators notify PHMSA every time they reduce pipeline pressure to make a repair. Following a brief discussion, a motion was made and seconded for the committees to accept the proposed rule changes (as presented during the oral presentation). The motion was unanimously carried. 1.5 SCOPE OF ANALYSIS This final EA analyzes the potential environmental consequences associated with implementing the final rule entitled; Pipeline Safety: Integrity Management Program Modifications and Clarifications. Chapter 1 provides background information regarding the purpose of and need for the proposed rulemaking. Chapter 2 describes PHMSA's No Action Alternative. Chapter 3 describes the environment affected by the proposed Proposed Action, Alternative A (the proposed changes described in the NPRM) and the environment from the alternatives. This EA will focus only on those resource categories rulemaking, as well as potential environmental consequences to that affectec nat are of interest to the public and/or important to the decision: public health an afety, hazardous materials transportation. socioeconomics, and other special areas o consideration. August 2006 1-6#

Page 102.0 PROPOSED ACTION AND ALTERNATIVES 2.1 OVERVIEW OF ALTERNATIVES This chapter briefly describes the Proposed Action and any reasonable alternatives to the Proposed Action for the modifications and clarifications to the IMP regulations. In accordance with NEPA, the CEQ regulations and DOT Order 5610.1C, the No Action alternative must also be considered to define the existing conditions of the natural and human-made environments and to use as a baseline comparison to the Proposed Action and other reasonable alternatives. 2.2 ALTERNATIVES DEVELOPMENT PROCESS PHMSA considered four alternatives in considering modifications and clarifications to the IMP regulations: • No Action • Proposed Action - revise the current pipeline safety IMP regulations in HCAs by adopting the recommendations in the API/AOPL petition with some modifications, including adding a requirement to include that gas and hazardous liquid operators notifying PHMSA with reasons for repair delay when a pressure reduction exceeds 365 days, and correcting provisions for calculating pressure reductions for hazardous liquid pipelines operators. • Alternative A - includes the modifications contained in the Proposed Action as well as an additional requirement that gas and hazardous liquid pipeline operators notify PHMSA whenever they reduce pipeline pressure to make a repair and to provide reasons for pressure reduction. Alternative A was included as the proposed action in the draft EA as well as the NPRM. 2.3 NO ACTION ALTERNATIVE Under the No Action alternative the existing regulations would remain in place and the current PHMSA regulations that prescribe standards regarding pipeline integrity management in HCAs would remain unchanged. The No Action alternative does not allow for increased flexibility for operators in scheduling assessments. It also does not allow PHMSA to become aware of situations in which delays to required repairs extend for long periods of time (e.g. beyond 365 days), or to correct the provisions for calculating reduced pressure for hazardous liquid operators. Therefore, the No Action Alternative does not meet the purpose and need to develop pipeline safety standards that August 2006 2-1#

Page 11are practicable and designed to meet the need for environmental safety and protection in accordance with 49 USC 60109 (b). 2.4 PROPOSED ACTION The proposed action includes implementation of the final rule entitled: Pipeline Safety: Integrity Management Program Modifications and Clarifications and would amend the pipeline safety regulations to: • Allow more flexibility in the reassessment interval for hazardous liquid pipelines by adding an eight-month window to the established five-year time frame for operators to complete reassessments; • Add a requirement to include notifying PHMSA with reasons for repair delay when a pressure reduction exceeds 365 days; and • Correct the existing provision for calculating pressure reductions when making immediate repairs on a hazardous liquid pipeline. The proposed correction allows operators the use of another acceptable method for calculating reduced operating pressure when the specified formula is not applicable, or results in a calculated pressure higher than the operating pressure The Proposed Action applies specifically to hazardous liquid and gas pipeline operators. PHMSA had previously established the IMP, requiring hazardous liquid and gas transmission pipelines to regularly schedule the evaluation of pipeline integrity and to repair discovered defects. The final rule will add flexibility to scheduling assessments for hazardous liquid pipelines, but will not impact the number of entities subject to the existing regulatory requirements nor impact the number of assessments and repairs to be conducted. The notification requirements to PHMSA will increase slightly under the final rule. The regulatory changes will be incorporated into Title 49 of the CFRs. The proposed changes are as follows: Section 195.452 (i)(3): Change length of intervals for continually assessing the integrity of hazardous liquid pipelines from five-years (60 months) to five-years not to exceed 68 months. Section 195.452 (h)(4)(i): Allow hazardous liquid pipeline operators to use another acceptable method for calculating a reduced operating pressure when the formula in 451.7 ot ASME/ANSI B31.4 (ibr, see Sec. 195.3) is not applicable. If the formula is not applicable to the type of anomaly or the calculated pressure results in higher operating pressure, an operator must use an alternative acceptable method to calculate a reduced operating pressure. Sections 192.933 (a)(1)(i) and 195.452 (h)(1)(i): Change notification of pressure requirements for gas transmission operators (192.933) and hazardous liquid pipeline August 2006 2-2#

Page 12operators (195.452). Currently, an operator must notify PHMSA when they cannot meet scheduled repairs and cannot provide safety though a temporary pressure reduction. The final rule will require operators to notify PHMSA with reasons for repair delay when a pressure reduction exceeds 365 days. 2.5 ALTERNATIVE A (NPRM PROPOSAL) Alternative A includes all of the changes contained in the Proposed Action in addition to the following measure: • Require both hazardous liquid and natural gas pipeline operators to notify PHMSA whenever they reduce pipeline pressure to make a repair and to provide reasons for pressure reduction; The frequency of notification of reduced pressure would increase for operators under Alternative A (NPRM proposal). As stated above for the Proposed Action, the regulatory changes would be incorporated into Title 49 of the CFR at 192.933 for gas operators and 195.452 for hazardous liquid pipeline operators. 2.6 ALTERNATIVE B Alternative B includes the recommendations contained in the petition by API/AOPL. This alternative would amend the hazardous liquid pipeline safety regulations to: • Allow more flexibility in the reassessment interval for hazardous liquid pipelines by adding an eight-month window to the five-year time frame for operators to complete the reassessment; and • Require hazardous liquid pipeline operators to notify PHMSA whenever various obstacles prevent them from compliance under the IMP (e.g. visual assessment, investigation, remediation and repair. The regulatory changes would be incorporated into Title 49 CFR in Sections 195.452, as detailed above. PHMSA acknowledged that Alternative B would not correct the existing provision for calculating a pressure reduction nor would it provide additional information to PHMSA on reasons gas and hazardous liquid operators need to reduce pressure. For the reasons stated in section 1.3.2 and 1.3.3, such modifications are viewed as necessary by PHMSA. As Alternative B does not meet the purpose of and need to develop pipeline safety standards designed to meet the need for environmental safety and protection it was dismissed from further consideration and is therefore not analyzed in detail in this EA August 2006 2-3#

Page 132.7 COMPARISON OF THE ALTERNATIVES This section compares the potential consequences of the Proposed Action, Alternative A (NPRM proposal) and the No Action alternative. The analysis behind the information in Table 2-1 is presented in Chapter 3. Table 2-1 presents a tabular comparison of the environmental and socioeconomic consequences (listed by impact category). Due to data availability and the scope of this assessment, the information detailed below concentrates on qualitative rather than quantitative analyses. Nevertheless, it is evident from Table 2-1 that implementation of the final rule is expected to result in beneficial impacts - most importantly, the positive impacts to public health and safety, in addition to positive indirect impacts to aspects of the physical and human environment. Table 2-1. Environmental Consequences - Comparison of Alternatives Impact Category No Action Proposed Action Alternative A Potential minor benefits due Would not change the Public Health of public health and safety. current and projected status to increased information to increased information Potential minor benefits due gathering/formula and Safety Incorrect pressure formula corrections; potential gathering/formula correction ; negative impacts. may pose small risk of negligible increased risk of negative impacts of potential negative impacts of incident due to increased negligible increased risk of reassessment time window incident due to increased reassessment time window Would not change the There is a minimal risk of current and projected status increased incidents, and There is a minimal risk of Hazardous of hazardous materials thereby additional thereby additional hazardous increased incidents, and Transportation Materials transportation. Potential hazardous materials impacts to the natural and transportation due to an materials transportation due human environment would increased reassessment time time window. The impact of to an increased reassessment continue to occur. window. The impact of this this is expected to be minor. The No Action alternative is expected to be minor would not change the costs proposed modifications to The combination of The combination of proposed safety and incidents, as there associated with pipeline the IMP for hazardous modifications to the IMP for Socioeconomics hazardous liquid and gas liquid and gas transmission transmission pipelines are pipelines are expected to expected to create positive create positive net benefits. Impacts are not expected to be significantly different Endangered from the No Action. Impacts are not expected to Species be significantly different from the No Action. otential impacts to NHPA xpected to be minor. Resources resources would continue to protected by the occur. However, since the Impacts are not expected to NHPA rate of pipeline incidents is be significantly different small, these impacts are Impacts are not expected to from the No Action. be significantly different August 2006 2-4#

Page 14However, based on the lack from the No Action. f national data on pipeline n the vicinity of historica properties, it is impossible to stimate the extent of Potential impacts to wetlands would continue to occur. Impacts are not expected to Wetlands pipeline incidents is small, However, since the rate of be significantly different Impacts are not expected to these impacts are expected to from the No Action. be significantly different from the No Action. be minor. Potential impacts to Section continue to occur. However, 4(f) resources would incidens is mail, eise Section 4(f) impacts are expected to be Impacts are not expected to be significantly different Impacts are not expected to resources minor. However, based on from the No Action. be significantly different the lack of national data on from the No Action. pipelines in the vicinity of 4(f) resources, it is impossible to estimate the extent of potential impacts. Both the Proposed Action and Alternative A involve assessment scheduling, as well a notification requirement to PHMSA with reasons for repair delays when pressure reduction exceeds 365 days, and are unlikely to significantly affect the quality of the human environment. The primary benefit of the Proposed Action and Alternative A would be to add flexibility to the scheduling of assessments that would allow for more continuous operations. The notification requirements (>365 days) would allow PHMSA to become aware of situations in which delays to required repairs extend for long periods of time. Lastly, the Proposed Action and Alternative A would allow PHMSA to also correct the method whereby pipeline pressure is calculated, which improves safety. PHMSA agreed with numerous comments from the pipeline industry in response to the NPRM (Alternative A) that requiring operators to notify PHMSA every time they reduced pressure for a repair under the IMP would add a significant burden and likely not result in commensurate useful information regarding the impact on energy supply, which was one of the initial goals for information collection as stated in the NPRM.. August 2006 2-5#

Page 153.0 AFFECTED ENVIRONMENT AND ENVIRONMENTAL CONSEQUENCES The alternatives considered in this document relate to pipeline assessments, pressure reductions, and reporting. To assist PHMSA in understanding the potential environmental impacts of the alternatives, this chapter describes the environmental resources of the U.S. particular to the alternatives. The resources that may be affected by the alternatives are presented and described, along with a description of the regulatory framework where relevant. This chapter also addresses the potential environmental consequences associated with the No Action, Proposed Action and Alternative A. In general, transportation affects a range of environmental resources through the construction of the transportation network, the improvement of facilities and infrastructure, and their operation. The alternatives would affect all hazardous liquid pipeline operators and gas transmission operators. Natural gas transmission pipelines are those lines that connect gas production sources with gas consumers. Hazardous liquid pipelines are those that deliver hazardous liquids, as defined by Federal pipeline safety regulations, from production or processing facilities to terminals and final consumers. Therefore, the affected environment is the land area in the U.S. in which these pipelines are located. This final EA will focus only on those resource categories that are potentially impacted by the alternatives, those that are of interest to the public, and/or important to the decision. The resource categories to be analyzed in this final EA are: public health and safety, hazardous materials transportation, socioeconomics, and other special areas of consideration. 3.1 AFFECTED ENVIRONMENT As the alternatives relate to the regulation of the safety of about two million miles of gas and hazardous liquid pipelines, the actual physical environment that may be affected includes the environmental and socioeconomic resources in the vicinity of those pipelines. Pipelines are located throughout the U.S., and most hazardous liquid and gas pipelines are buried underground. The physical environment potentially affected by the proposed action includes the surrounding air, water resources (e.g., oceans, streams, lakes), cultural and historical resources (e.g., properties listed on or eligible for listing in the National Register of Historic Places), biological and ecological resources (e.g., coastal zones, wetlands, plant and animal species and their habitat, forests, grasslands, offshore marine ecosystems), and special ecological resources (e.g., threatened and endangered plant and animal species and their habitat, national, state and local parklands, biological reserves, Wild and Scenic Rivers) that exist directly adjacent to and within the vicinity of pipelines. August 2006 3-6#

Page 16Because the pipelines subject to the proposed rulemaking may contain hazardous materials, the resources within the physical affected environment, as well as public health and safety, may be affected by gas and hazardous pipeline incidents such as spills and leaks. Depending on the size of the spill or gas leak, and the nature of the impact zone, the environmental impacts vary from property damage and environmental damage to injuries or fatalities. Incidents on pipelines can result in fires and explosions, with resulting damage to the local environment. In addition, since pipelines often contain gas streams laden with condensates and natural gas liquids (NGLs), failures also result in spills of these liquids, which can cause environmental harm. In the past 10 years there have been 1668 hazardous liquid pipeline incidents and 795 gas transmission line incidents. These incidents resulted in17 and 26 fatalities respectively over the 10 years. Environmental consequences of the alternatives to the physical environment are examined in Section 3.2. 3.2 ENVIRONMENTAL CONSEQUENCES 3.2.1 Public Health and Safety No Action Alternative Under the No Action alternative, PHMSA would not add to or revise the current regulations that prescribe standards for HCAs. The current five-year limit established by PHMSA was formulated on the basis for effectively protecting the public and environment. The pressure calculation formula would continue without correction, sometimes leading operators to inaccurate calculations. Therefore, the No Action alternative would not change the current and projected status of public health and safety, but there is a potential for minor negative impacts without correcting the pressure calculation formula. Proposed Action and Alternative A The Proposed Action and Alternative A are expected to allow operators flexibility in reassessment by adding an additional eight month window beyond the current five years reassessment interval. There is a small chance for an increased risk of pipeline incidents due to the increased time interval. However, because the modifications are aiming to allow operators to use their engineering judgment, the risk is small and no significant impacts are expected. The increased window may also result in additional benefits, such as making future maintenance easier. Both alternatives also correct the pressure reduction calculation formula used by hazardous liquid operators when making repairs and require notification to PHMSA of repair delays when a pressure reduction exceeds 365 days. These actions both result in a benefit to public health and safety, by minimizing pressure reduction errors and allowing PHMSA to become aware of situations in which delays to repair occur. Alternative A also includes a notification August 2006 3-7#

Page 17requirement for pipeline operators to notify PHMSA any time pressure is reduced under the IMP. With the additional reporting requirements, PHMSA would have more information about the reasons for a pressure reduction. PHMSA maintains however, that the current notification requirement addresses those situations of most importance to safety - instances in which an operator is unable to make repairs within the required timeframes and also cannot reduce pressure. Therefore, adding this notification ' requirement would not necessarily substantially improve public health and safety. In addition, PHMSA agrees that this data can be collected periodically as part of annual reports. PHMSA is currently in the process of revising the annual report requirements to collect this information. 3.2.2 Hazardous Materials Transportation Pipeline incidents can result in fatalities and injuries, as well as lost condensates and NGLs. Such incidents can impact the physical environment (i.e., the air, water, biological, ecological, and historical resources) around the pipeline if the material being transported within the pipelines leaks or spills into that environment. No Action Alternative Under the No Action alternative, the rate of pipeline incidents will not change, as no new regulations would be implemented. Therefore, the No Action Alternative would not change the current and projected status of hazardous materials transportation. Potential impacts to the natural and human environment would continue to occur. Proposed Action and Alternative A The Proposed Action and Alternative A are not expected to have a measurable effect on hazardous materials transportation. The modifications deal mostly with timeframes for assessment and will not affect hazardous material transportation directly. There is a small risk of increased incidents over the eight-month increase to the reassessment time window. This time frame is consistent with other PHMSA requirements; therefore, it is expected that the rate of pipeline incidents will not change. The impact of this is expected to be minor. Pressure reduction notifications or calculations will not have an impact on hazardous materials transportation. 3.2.3 Socioeconomics As part of the rulemaking action and in this EA, the costs and benefits of implementation of the final rule have been assessed. The detailed economic analysis is presented in the final Regulatory Assessment contained in the docket (PHMSA 2006c). No Action Alternative Under the No Action alternative, no change in the costs resulting from pipeline incidents would occur, as there would be no changes to the existing regulations. August 2006 3-8#

Page 18Proposed Action and Alternative A Both gas transmission and hazardous liquid pipeline operators are generally large firms. Therefore, no small entities are affected by the changes in the final rule. A total of 1,166 entities or operators would be affected by the final rulel' (see Table 3-1). All proposed changes to the IMP from both the Proposed Action and Alternative A are cost-effective. The proposed changes to 49 CFR 195.452 and 195.3 would create benefits through added flexibility for liquid pipeline operators without raising the costs of compliance with reassessment and remediation regulation. The operators would conduct the same number of inspections and repairs as under existing regulations. Table 3-1. Numbers of Operators by Pipeline Type Estimated Pipeline Type Number of Operators Hazardous liquid transmission pipelines 263 Natural gas transmission pipelines (includes 903 gathering lines) TOTAL 1,166 Source: PHMSA Hazardous Liquid Annual Reports and Gas Transmission Annual Reports as pf 10/2005 The change to notify PHMSA of repair delays when pressure reduction exceeds 365 days will have minimal cost effect if any. The changes to notification requirements for pressure reduction for Alternative A would create some additional costs. PHMSA had originally hoped to work with the US Department of Energy to analyze whether prolonged pressure reductions have an impact only one factor in estimating supply impact and it would be difficult, at best, to estimate on the Nations energy supply. PHMSA maintains however, that pressure reduction is such impact knowing only that pressure had been reduced. As stated above, PHMSA agrees with industry comment, that this data can be collected periodically as part of annual reports, which will reduce the added burden on industry. PHMSA is currently in the process of revising the annual report requirements. 3.2.4 Special Areas of Consideration Specific resources and impact categories that should be considered under NEPA include resources protected by the National Historic Preservation Act (NHPA) and related executive orders, wetlands, determinations under Section 4(f) of the DOT Act [recodified ' Additionally, the final rule would affect some intrastate operators that operate HCA miles under IMP program. August 2006 3-9#

Page 19at 49 U.S.C. 303(c)], and plants and animals that are protected under the Endangered Species Act. Endangered species, wetlands, historical resources, and ecological resources such as parklands and reserves are discussed as part of the affected environment in Section 3.1, Impacts to these areas are discussed as part of the environmental consequences section in the resource categories of public health and safety as well as hazardous materials transportation. This section will elaborate on PHMSA responsibility under the NHPA and Section 4(f) of the DOT Act. NHPA Compliance Based on the information found at 36 CFR 800.16(y)?, the Proposed Action and Alternative A would constitute an undertaking, as they are activities carried out under the direct jurisdiction of PHMSA. Based on the lack of national data on pipelines in the vicinity of historical structures, it is not possible to estimate the extent of potential impacts. However, neither alternative would directly affect any historic or cultural resources, as they largely involve the scheduling of assessments and reporting. Thus, the Proposed Action and Alternative A are not the type of action that have the potential to cause effects on historic properties or cultural resources. Section 4(f) Compliance Section 4(f) of the DOT Act requires agencies within the DOT to make special effort to preserve the natural beauty of historic sites and public parks and recreation lands; if a transportation program requires the use of public land in a public park, the program must include all possible planning to minimize harm to the park or historic area. None of the alternatives would include, either directly or indirectly, the use of any land from, or in close proximity to, a public park, recreation area, wildlife and waterfowl refuge, or historic site, because of an activity such as construction of a new building. As such, there will not be a 4(f) statement prepared for the Proposed Action or implementation of the final rule. Benefits of the Proposed Action Additional benefits resulting from the Proposed Action are difficult to quantify. However, some of the benefits from these changes include allowing operators more flexibility in scheduling and completing the reassessment, without compromising pipeline safety. Also, the requirement to notify PHMSA of repair delays when pressure reduction exceeds 365 days specifying notification procedures will give better information on circumstances that constrain operators, and help the PHMSA recognize patterns that may be impacting pipeline safety. Overall, the benefits of this action will allow for more flexibility and safer pressure reduction formula provisions for liquid pipeline operators and give PHMSA more information about repair delays that exceed 365 days without creating a significant burden or cost on the gas and hazardous liquid pipeline operators. 2 36 CFR 800.16(y): "Undertaking means a project, activity, or program funded in whole or in part under the direct or indirect jurisdiction of a Federal agency, including those carried out by or on behalf of a feesa, arency tale caried out with Federal financial assistance; and those requiring a Federal permit, August 2006 3-10#

Page 203.3 FINDING OF NO SIGNIFICANT IMPACT (FONSI) After careful and thorough consideration of the facts contained herein, PHMSA finds that implementation of the Proposed Action and final rule entitled; "Pipeline Safety: Integrity Management Program Modifications and Clarifications" is consistent with existing national policies and objectives as set forth in Section 101 (a) of the NEPA and other applicable environmental requirements and will not significantly affect the quality of the human environmental or otherwise include any condition requiring consultation pursuant to Section 101(2)(c) of the NEPA. August 2006 3-11#

Page 214.0 LIST OF PERSONS CONSULTED The Technical Hazardous Liquid Pipeline Safety Standards Committee The Technical Pipeline Safety Standards Committee 5.0 LIST OF PREPARERS AND REVIEWERS This EA was prepared and reviewed by staff and specialists within PHMSA and the Volpe National Transportation Systems Center (part of the Research and Innovative Technology Administration. 6.0 REFERENCES Letter to PHMSA dated June 18, 2004, from the American Petroleum Institute and the Association of Oil Pipe Lines, Re: Request for Integrity Management Program Modifications and Clarifications (Title 49 Part 195.452), [See Docket No. RSPA- 04-18938-2]. Federal Register/Vol. 70, No. 240/Thursday, December 15, 2005 Proposed Rules - Integrity Management: Program Modifications and Clarifications - Request for Comments Regulatory Assessment, Final Rule, Pipeline Integrity Management: Program, Modifications and Clarifications. Research and Innovation Technology Administration, U.S. Department of Transportation. July 2006. August 2006 6-1#