TransCanada has promised to adhere to 57 special safety conditions, and in the event of an accidental oil spill from its Keystone XL pipeline would be responsible for all cleanup costs, Nebraska Governor Dave Heineman promised this month when he approved the company's revised route through the state.
Responding to concerns about the possibility of catastrophic pollution, the pipeline has been re-routed to avoid the environmentally sensitive Sand Hills, though it still crosses parts of the High Plains (Ogallala) Aquifer.
TransCanada has agreed to more rigorous pipeline design, manufacturing, construction, operational and maintenance standards, according to Heineman, and will be required to provide evidence it has at least $200 million in third-party liability insurance to cover the cost of cleaning up any spill in the state.
The new route and safety commitments are unlikely to satisfy environmental groups campaigning against the pipeline, for whom it has become a powerful symbol of the wider struggle between fossil fuels and clean technology.
"The Keystone XL tar sands pipeline is a lynchpin enabling the climate intensive tar sands industry to grow unimpeded," according to the Natural Resources Defense Council (NRDC). "If Keystone is approved, we're locking in several more decades of fossil fuels and higher levels of carbon dioxide and global warming," NRDC warns.
Environmentalists continue to press President Barack Obama to refuse permission to construct the pipeline across the U.S.-Canadian border, in an attempt to deprive Canada's oil sands industry of a market and try to shut it down.
There is nothing more TransCanada can do to allay the concerns of its most trenchant critics. But the high-profile campaign against Keystone and recent pipeline incidents have put the safety record of America's pipeline operators under the spotlight.
PIPELINE SAFETY
Transporting natural gas and hazardous liquids by pipeline is relative safe compared with other modes of transportation, according to the Government Accountability Office (GAO).
The United States has 400,000 miles of transmission pipelines carrying natural gas and hazardous liquids like crude, across the country, in addition to 250,000 miles of gas and liquids field-gathering pipelines, and 2 million miles of distribution lines delivering gas to end users.
Between 2007 and 2011, pipelines accounted for 14 fatalities per year, including 2 per year on the bulk transmission network. In comparison, 3,675 people were killed in accidents involving trucks, and 730 were killed by the railroads, in 2010, according to GAO ("Better Data and Guidance Needed to Improve Pipeline Operator Incident Response" Jan 2013).
Nonetheless, when pipelines leak or rupture, the results can be catastrophic.
In December, a natural gas transmission pipeline exploded at Sissonville, West Virginia, destroying several homes and melting a section of interstate highway.
In September 2010, a gas pipeline explosion killed 8 people and destroyed more than 100 homes in San Bruno, California, a suburb of San Francisco.
In July 2010, pipeline operator Enbridge pumped 843,000 gallons (20,000 barrels) of heavy bituminous Canadian crude into wetlands near Marshall in Michigan, polluting the Kalamazoo river, after a corroded section of 30-inch diameter pipe in the Lakehead System (Line 6B) ruptured suddenly.
Enbridge suffered an even bigger leak on another line (Line 3) in 1991, spilling 1.7 million gallons of crude near Grand Rapids in Michigan.
BETTER REGULATION
Interstate gas and oil pipelines are regulated by the Pipeline and Hazardous Materials Safety Administration (PHMSA). But the agency's inspection system and oversight of Enbridge were strongly criticised by accident investigators from the National Transportation Safety Board (NTSB) following the Marshall/Kalamazoo spill.
PHMSA "failed to pursue findings from previous inspections and did not require Enbridge to excavate pipeline segments with injurious crack defects" according to the official accident report ("Pipeline Accident Report: Hazardous Liquid Pipeline Rupture and Release, Marshall, Michigan" Jul 2012).
The Code of Federal Regulations "does not provide clear requirements regarding when to repair and when to remediate pipeline defects", the investigators concluded. "Enbridge's delayed reporting ... by more than 460 days indicates that Enbridge's interpretation of the current regulation delayed the repair of the pipeline."
Under the current rules, PHMSA requires operators to respond to incidents in a "prompt and effective manner." Operators must meet minimum standards for leak detection and emergency response on all sections of line, and must conduct additional risk assessments and have mitigation plans for populated or environmentally sensitive "high-consequence areas."
Testifying before the Senate Committee on Commerce, Science and Transportation after the Sissonville explosion, GAO Director Susan Fleming recommended the agency collect better incident data, especially on response times, and be more active in sharing best practice and guidance with operators.
AUTOMATED VALVES
The question of whether to replace manually operated valves with automated ones has divided the industry and regulators.
In most incidents, the worst damage is done when the pipeline ruptures. But the faster that section of line can be isolated and shutdown the less the danger of secondary fires and large-scale pollution.
Following the San Bruno disaster, NTSB recommended automated valves should be required on all natural gas pipelines in all high-consequence populated areas.
Kinder Morgan has installed automated valves at 683 out of 832 locations on its natural gas pipeline system and plans to automate the rest within the next few years. "Automatic-shutoff valves, as opposed to remote control valves, were chosen because they reduce the potential for human error when making decisions to close valves," the company told GAO.
"The biggest concern of using automatic-shutoff valves is the potential for accidental closures, but (Kinder Morgan officials) believe they have developed a procedure for managing the pressure-sensing system that effectively adapts to pressure and flow change and minimises or eliminates these types of closures."
Other operators have preferred a case-by-case, risk-management approach, that seeks to balance the benefits of faster response times (reducing spill volumes) against the costs of accidental closures (interrupting service and causing safety issues) as well as the cost of equipment (estimated at up to $250,000 for each valve on a gas line and $500,000 for a valve on a liquids line).
Some operators insist it is safer to control shutdowns from a central control room. But in the Marshall/Kalamazoo spill, Enbridge's control room operators twice fired up the pumps and tried to restart the pipeline because they ignored multiple alarm systems and misinterpreted signs of a leak as a harmless bubble (column separation) in the pipe.
The pipe continued to spew tarry crude into local waterways for 17 hours as operators ignored company procedures that required them to shut down the line within 10 minutes if they could not resolve the cause of operational alarms and rule out a leak, and shut the line immediately if three or more alarms went off.
"There was no evidence that any member of the control centre staff sought to obtain information from anyone in the Marshall vicinity to verify the presence of a leak," NTSB wrote. Instead controllers convinced themselves the alarms were faulty and kept trying to boost the pressure within the line.
Ironically, the 10-minute rule had been introduced following the company's earlier disastrous spill at Grand Rapids. But "Enbridge control centre staff had developed a culture that accepted not adhering to the procedures," NTSB concluded.
If Keystone and other crude oil pipelines are to be routed across populated and environmentally sensitive areas, and the industry is to avoid a political backlash, it is essential the highest safety standards are imposed and maintained.
Operator errors and inadequate training have been identified by NTSB as contributory factors to both the Marshall and San Bruno incidents. Better training, better control systems, and the same crew resource management (CRM) approach federal regulators require for pilots, cabin crew, and maritime officers should be mandated for pipeline operators.
Safety is part of the social licence to operate for pipeline companies. Persistent concerns about PHMSA's performance must be addressed. And all pipeline operators must be held to, and rigorously enforce, a safety culture, which inspects lines intensively, acts on inspection reports, and shuts trunk lines at the first sign of abnormal operating conditions.
(Reuters, edited by Topco)