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DEPARTMENT OF TRANSPORTATION DATES: This final rule is effective on gas.1 Congress issued the mandate to March 13, 2020. The Director of the PHMSA following a large-scale natural Pipeline and Hazardous Materials Federal Register approved the gas leak at the Aliso Canyon UNGSF in Safety Administration incorporation by reference on January Southern California on October 23, 18, 2017. 2015. The mandate required PHMSA to 49 CFR Parts 191, 192, and 195 establish minimum safety standards for FOR FURTHER INFORMATION CONTACT: UNGSFs within two years of the PIPES [Docket No. PHMSA–2016–0016; Amdt. Nos. Technical questions: Byron Coy, Act issuance on June 22, 2016. To meet 191–27; 192–126; 195–103] Senior Technical Advisor, by telephone the mandate’s deadline—and address at 609–771–7810 or by email at the urgent need for safer storage of RIN 2137–AF22 [email protected]. natural gas—PHMSA published the IFR General information: Ashlin with a 60-day comment period. The IFR Pipeline Safety: Safety of Underground Bollacker, Technical Writer, by went into effect on January 18, 2017. Natural Gas Storage Facilities telephone at 202–366–4203 or by email Since that time, PHMSA has considered public comments and a AGENCY: Pipeline and Hazardous at [email protected]. petition for reconsideration of the IFR Materials Safety Administration SUPPLEMENTARY INFORMATION: and is modifying the minimum safety (PHMSA), Department of Transportation I. Executive Summary standards for UNGSFs in this final rule (DOT). A. Purpose of This Final Rule accordingly. PHMSA has also further ACTION: Final rule. B. Summary of the Major Provisions reviewed the Final Report of the C. Costs and Benefits Interagency Task Force on Natural Gas SUMMARY: The Pipeline and Hazardous II. Background Storage Safety 2 Materials Safety Administration is A. Overview of Underground Natural Gas to ensure any publishing this final rule to amend its Storage amendments in this final rule are minimum safety standards for B. Underground Storage Incidents and consistent with the Task Force’s Regulatory History recommendations to PHMSA.3 As underground natural gas storage C. Aliso Canyon Incident facilities (UNGSFs). On December 19, detailed in this final rule, PHMSA D. The PIPES Act of 2016 believes these changes will reduce 2016, PHMSA issued an interim final E. Interagency Task Force rule (IFR) establishing regulations in regulatory burdens and reduce costs for F. Interim Final Rule industry and gas consumers while response to the 2015 Aliso Canyon G. Petition for Reconsideration incident and the subsequent mandate in III. Comment Summaries and PHMSA’s sustaining safety and protecting the section 12 of the Protecting our Responses environment. Infrastructure of Pipelines and A. Introduction B. Summary of the Major Provisions Enhancing Safety Act of 2016. The IFR B. Incorporation by Reference of API Recommended Practices 1170 and 1171 Consistent with the IFR, this final rule incorporated by reference two American C. Compliance Timelines maintains the incorporation by Petroleum Institute (API) Recommended D. Placement of Underground Storage reference of American Petroleum Practices (RPs): API RP 1170, ‘‘Design Regulations in a New Part for Title 49 of Institute (API) Recommended Practices and Operation of Solution-mined Salt the 49 CFR (RPs) 1170 and 1171 (the RPs) as the Caverns Used for Natural Gas Storage’’ E. Suitability of API RPs 1170 and 1171 as basis of the minimum safety standards (First Edition, July 2015); and API RP the Basis for Rulemaking in 49 CFR part 192. API RP 1170, 1171, ‘‘Functional Integrity of Natural F. Integrity Management Practices G. Notification Criteria Under 49 CFR Part ‘‘Design and Operation of Solution- Gas Storage in Depleted Hydrocarbon mined Salt Caverns Used for Natural Reservoirs and Aquifer Reservoirs’’ 191 for Changes at a Facility H. The States’ Role in Regulating UNGSFs Gas Storage’’ 4 has recommended (First Edition, September 2015). The IFR I. Definitions and Terminology practices for solution-mined salt cavern required each provision in the API RPs J. Requests for Additional or More facilities used for natural gas storage to apply as mandatory (i.e., each Stringent Requirements and covers facility geomechanical ‘‘should’’ statement would apply as a IV. Regulatory Analyses and Notices assessments, cavern well design and ‘‘shall’’) unless an operator provides drilling, solution mining techniques, written justification for not I. Executive Summary implementing the practice, including an A. Purpose of This Final Rule 1 For a description of these storage types and explanation for why it is impracticable other basic information about underground natural and not necessary for safety. Based on The Pipeline and Hazardous Materials gas storage, see https://www.eia.gov/naturalgas/ the comments received to the IFR and Safety Administration (PHMSA) is storage/basics/. amending the pipeline safety 2 ‘‘Ensuring Safe and Reliable Underground a petition for reconsideration, PHMSA Natural Gas Storage,’’ Final Report of the has determined that the RPs, as regulations applicable to underground Interagency Task force on Natural Gas Storage originally published, will provide natural gas storage facilities (UNGSFs). Safety; October 2016. See https://www.energy.gov/ PHMSA with a stronger basis upon PHMSA is amending the UNGSF downloads/report-ensuring-safe-and-reliable- which to base enforcement than the IFR. regulations in response to comments underground-natural-gas-storage. and recommendations received on its 3 In addition to their comments on the IFR, on This final rule also addresses March 17, 2017, the State of Texas and the Texas recommendations from commenters and interim final rule (IFR) published on Railroad Commission petitioned the U.S. Court of a petition for reconsideration of the IFR December 19, 2016 (81 FR 91860). The Appeals for the Fifth Circuit for review of the IFR by modifying compliance timelines, IFR implemented PHMSA’s authority to under 49 U.S.C. 60119(a). See State of Texas v. regulate UNGSFs and the Congressional PHMSA, No. 17–60189 (5th Cir. Mar. 17, 2017). On revising the definition of a UNGSF, April 24, 2017, the court granted INGAA and AGA’s clarifying the states’ regulatory role, mandate in section 12 of the PIPES Act motions to intervene in the litigation. On July 19, reducing recordkeeping and reporting (Pub. L. 114–183) to establish minimum 2017, the court granted a joint motion to hold the requirements, formalizing integrity safety standards for depleted- petition for review in abeyance pending the hydrocarbon reservoirs, aquifer issuance of this final rule. management practices, and adding risk 4 API Recommended Practice 1170 ‘‘Design and management requirements for solution- reservoirs, and solution-mined salt Operation of Solution-mined Salt Caverns used for mined salt caverns. caverns used for the storage of natural Natural Gas Storage (First Edition, July 2015).

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and operations, including monitoring caverns to follow the same risk the public comments on the IFR that the and maintenance practices. API RP management practices as depleted- placement of the definition in part 192 1171, ‘‘Functional Integrity of Natural hydrocarbon reservoirs and aquifers that created questions for operators as to Gas Storage in Depleted Hydrocarbon apply to the physical characteristics and where a gas pipeline facility ended, and Reservoirs and Aquifer Reservoirs’’ 5 has operations of the facility (i.e., follow regulations for a UNGSFs began. To recommended practices for natural gas section 8 of API RP 1171). Since the remedy this confusion, PHMSA is storage in depleted oil and gas publication of the IFR, PHMSA has revising the definition of an reservoirs and aquifers, and focuses on observed that many operators of ‘‘underground natural gas storage storage well, reservoir, and fluid solution-mined salt caverns are facility’’ to exclude other components of management for functional integrity in voluntarily using section 8 of API RP a gas pipeline or gas pipeline facility design, construction, operation, 1171 to supplement the risk covered elsewhere in part 192, and monitoring, maintenance, and management practices in section 10 of eliminate any potential overlap. PHMSA documentation practices. Both RPs API RP 1170. While most salt-cavern discusses the revised definition and the describe ways to maintain the UNGSFs have a risk-management reason for keeping it in part 192 later in functional integrity of design, program in place, section 8 of API RP this document. construction, operation, monitoring, 1171 provides more prescriptive Sixth, PHMSA is changing the name maintenance, and documentation practices than API RP 1170 for how an of the reporting portal to the ‘‘National practices for UNGSFs. The RPs contain operator must develop, implement, and Registry of Operators’’ (formerly the numerous provisions that use the term document a program to manage risks ‘‘National Registry of Pipeline and LNG ‘‘shall’’ to denote a minimum that could affect the functional integrity Operators’’). Additionally, PHMSA is requirement necessary to comply with of the storage operation. Extending the revising the name of the online portal’s the RP. The RPs also use non-mandatory applicability of the recommended web address from ‘‘http:// terms such as ‘‘should,’’ ‘‘may,’’ and practices in section 8 of 1171 closes a opsweb.phmsa.dot.gov’’ to ‘‘https:// ‘‘can’’ to denote a recommendation that potential critical safety gap for salt- portal.phmsa.dot.gov.’’ These changes is advised, but not required. cavern storage facilities and may are throughout parts 191, 192, and 195. This final rule amends the IFR in six prevent future failures at these facilities. C. Costs and Benefits primary ways. First, PHMSA adopts the PHMSA has codified this practice in the Consistent with Executive Order RPs without modification to the non- final rule to ensure consistency across (E.O.) 12866, PHMSA has prepared a mandatory terms. In the IFR, PHMSA all UNGSF facilities. Regulatory Impact Analysis (RIA) that adopted the RPs by modifying the non- Fourth, PHMSA is narrowing the includes an assessment of the benefits mandatory provisions (i.e., statements scope of reportable events and changes and costs of this final rule, as well as containing ‘‘should’’ and other non- at facilities. In addition to annual data reasonable alternatives. PHMSA mandatory terms) as mandatory reporting and National Registry published an RIA to accompany the IFR requirements (i.e., ‘‘shall’’). PHMSA information, the IFR required operators as well. This final RIA incorporates provided that operators could deviate to notify PHMSA of certain changes and events and their facilities, such as input from public comments on the IFR from the modified statements by and the initial RIA. PHMSA has issued providing a justification in their incidents and safety-related conditions. Since the IFR, PHMSA received many the final RIA concurrently with this procedure manuals as to why the final rule, and it is available in the provision was ‘‘not practicable and not notifications for routine maintenance activities, which was not the intent of docket (PHMSA–2016–0016). necessary for safety’’ at their specific The annualized cost savings for this facility. Accordingly, with this final the regulation. Operators are not required to notify PHMSA of regular final rule, relative to the IFR, are rule, PHMSA also no longer requires estimated to be $11 million, applying a operators to provide written maintenance. To make this clear, PHMSA is limiting notification of 7 percent discount rate. The benefits of justifications as to why they would not changes to a facility 60 days prior to the this final rule come from making have performed a ‘‘should’’ provision. permanent the safety measures in the Second, this final rule is formalizing following events: (1) All plugging or abandonment activities (regardless of IFR and RPs 1170 and 1171, which API requirements and deadlines for and other stakeholders developed to operators to develop and implement costs), and (2) construction or maintenance that requires a workover prevent leaks and blowouts before they their integrity management (IM) rig and costs $200,000 or more. PHMSA occur. The safety measures adopted programs and to conduct their baseline is also applying an emergency through the IFR and this final rule will risk assessments for UNGSFs. As noted exemption to the 60-day notification prompt operators to undertake or hasten by commenters and petitioners, the API requirements, which PHMSA preventive and mitigative measures, as RPs function as an IM system for overlooked in the IFR. well as IM actions, such as mechanical UNGSFs, which requires more time to Fifth, this final rule is revising the integrity tests, that will reduce the implement than the IFR allowed. After definition of an ‘‘underground natural probability of releases. considering these comments and gas storage facility.’’ The PIPES Act The IFR reduced the likelihood and recommendations, PHMSA is relaxing amended 49 U.S.C. 60101(a) to define magnitude of catastrophic or operational the timeline for completing initial an ‘‘underground natural gas storage natural gas releases by promoting safer assessments of the reservoirs, caverns, facility’’ as ‘‘a gas pipeline facility that practices through the incorporation of and wells. PHMSA discusses these new stores natural gas in an underground the recommended practices into the requirements and deadlines in Section facility, including—a depleted pipeline safety regulations. This final III–C, ‘‘Compliance Timelines.’’ hydrocarbon reservoir, an aquifer rule continues to require these same Third, this final rule includes a reservoir; or a solution-mined salt practices. For example, operators are requirement for solution-mined salt cavern reservoir.’’ The IFR incorporated required to assess the mechanical a modified version of this definition in integrity of each storage well, evaluate 5 API Recommended Practice 1170 ‘‘Functional Integrity of Natural Gas Storage in Depleted part 192. Part 192 covers the the likelihood of failures at these wells, Hydrocarbon Reservoirs and Aquifer Reservoirs’’ transportation of natural gas by and determine the next steps to remedy (First Edition, September 2015). pipeline. PHMSA discovered through conditions that could precede the

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failures. Operators are also required to II. Background These types of storage facilities incorporate safety best practices when commonly receive surplus gas from A. Overview of Underground Natural designing and constructing new wells, interstate pipelines during warmer Gas Storage which could further prevent months and then send it back into the catastrophic failures. Underground storage of natural gas product stream during colder winter This final rule also adds a plays a critical role in the nation’s months. Since these UNGSFs serve requirement for all solution-mined salt energy independence and reliability. interstate facilities and PHMSA has caverns to follow the risk management Notably, having a surplus of natural gas exclusive pipeline safety jurisdiction practices in section 8 of RP 1171. Per provides a buffer from the seasonal over the design, construction, operation, the IFR, PHMSA had only required variations in supply and demand, and maintenance of interstate gas operators of solution-mined salt caverns creating price stability for customers. pipeline facilities, the standards in this to follow the risk management practices Over the past ten years, natural gas final rule will affect all interstate in section 10 of RP 1170. The language storage has increased 16 percent, UNGSFs. in section 10, requires operators to take prompted, in part, by significant growth Intrastate UNGSFs, on the other hand, a ‘‘holistic and comprehensive approach in domestic shale-gas production. are facilities that provide gas storage for There are three principal types of to monitoring cavern integrity,’’ without intrastate pipelines, most notably local underground natural gas storage fields, providing specifics as to how to gas distribution companies (LDCs). each with different geological implement that approach. Post-IFR, These storage facilities serve intrastate characteristics and capabilities that during preliminary inspections, PHMSA pipelines that are contained entirely govern their suitability for storage. The observed operators of solution-mined within a particular State and that do not three types are depleted hydrocarbon salt caverns applying the framework of fall within the jurisdiction of the reservoirs, aquifer reservoirs, and the risk management practices in Federal Energy Regulatory Commission solution-mined salt caverns. Depleted section 8 of RP 1171. While RP 1171 (FERC). As discussed more fully below, hydrocarbon reservoirs are the most applies to depleted hydrocarbon these intrastate ‘‘gas pipeline facilities’’ common type of storage, representing reservoirs and aquifer reservoirs, it are generally subject to the IFR and this approximately 80 percent of the total offers a framework for risk management final rule. Intrastate UNGSFs may working gas capacity in the United and monitoring that is translatable to continue to also be subject to State States. As the name implies, these other types of underground storage regulations provided that: (a) The facilities are repurposed from previous facilities. PHMSA expects that other otherwise applicable State regulation oil or gas production and converted to operators of solution-mined salt caverns does not conflict with the Federal gas storage fields.6 Aquifer reservoirs would benefit from a more specific minimum safety standards established are natural water-bearing formations, framework for implementing the in the final rule, and (b) the applicable also converted to gas storage, and ‘‘holistic and comprehensive approach State authority has filed a certification represent roughly 9 percent of the total to monitoring cavern integrity’’ required with PHMSA to participate as a full working gas capacity in the United in section 10 of 1170. State partner under the new Federal States. Solution-mined salt caverns (salt Additionally, codifying the program and to receive Federal funding domes) are geological formations that through PHMSA. requirement for these operators to leached out of salt deposits. These follow both section 8 of RP 1171 and facilities represent only about 10 B. Underground Storage Incidents and section 10 of RP 1170 ensures consistent percent of the total working-gas capacity Regulatory History safety requirements across all UGS but provide high withdrawal and While rare, serious incidents at facilities. This change may cause those injection rates relative to their working underground storage facilities have operators who were not already gas capacity.7 occurred. For instance, on April 7, 1992, (voluntarily) applying API RP 1171 as a Of the 403 active UNGSFs in the an uncontrolled release of highly framework for monitoring cavern United States, approximately 60 percent volatile liquids from a salt-dome storage integrity to undertake stronger risk of the facilities are interstate, and 40 cavern near Brenham, Texas, formed a management practices, which could percent of the facilities are intrastate.8 heavier-than-air gas cloud that ultimately reduce the risk of an The total storage capacity at these fields exploded. Three people died in the incident. However, PHMSA considers was 9,236 billion cubic feet (Bcf), and accident, with an additional 21 people this action part of the baseline the total working gas capacity was 4,815 treated for injuries at area hospitals. requirements to follow a ‘‘holistic and Bcf. Facilities identified as interstate Property damage from the accident comprehensive approach to monitoring represented 63 percent of total storage exceeded $9 million. cavern integrity’’ already prescribed capacity and 65 percent of working gas Following its accident investigation, through the IFR. As a result, PHMSA capacity. the National Transportation Safety does not expect an additional financial Interstate UNGSFs serve interstate Board (NTSB) published pipeline safety burden to operators beyond that already facilities, such as providing storage for recommendation No. P–93–9 regarding in place through the IFR. interstate gas transmission pipelines.9 underground storage. Recommendation The IFR required operators to provide P–93–9 asked PHMSA’s predecessor a written justification for each non- 6 Energy Information Administration (EIA). 2015. agency, the Research and Special mandatory provision of the RPs that ‘‘The Basics of Underground Natural Gas Storage.’’ Programs Administration (RSPA), to they did not perform. This final rule November 16, 2015. Retrieved from http:// www.eia.gov/naturalgas/storage/basics/ (Accessed develop safety requirements for storage removes that recordkeeping burden on March 2019). of highly volatile liquids and natural gas operators. Operators experience cost 7 Total working gas capacity percentages do not savings from the removal of sum to 100 percent due to rounding. is defined as ‘‘a gas pipeline facility—(A) used to requirements associated with deviations 8 PHMSA’s 2018 annual report data show 403 transport gas; and (B) subject to the jurisdiction of from the RPs, including technical active underground natural gas storage fields in the the [FERC] under the Natural Gas Act (15 U.S.C. United States as of 2017, distributed across 31 717 et seq.).’’ The term ‘‘transporting gas’’ is defined reviews by subject matter experts and states. in § 60101(a)(21) as ‘‘the gathering, transmission, or recordkeeping burdens, and reductions 9 Under 49 U.S.C. 60101(a)(6), an ‘‘interstate gas distribution of gas by pipeline, or the storage of gas, in the notifications burden. pipeline facility’’ (including an interstate UNGSF) in interstate or foreign commerce . . .’’

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in underground facilities, including a After a month, the flares burned off, 2016, although some sources place the requirement that all pipeline operators with the ultimate loss of 143 million number of related households at perform safety analyses of new and cubic feet (MCF) of natural gas from the approximately 8,000.14 existing underground geologic storage storage field. The leak at Aliso Canyon ultimately systems to identify potential failures, These incidents at UNGSFs alerted released approximately 5.7 Bcf of determine the likelihood that each operators and regulators to consider natural gas into the atmosphere, failure will occur, and assess the assessing the safety of these facilities. translating to 109,000 metric tons 15 of feasibility of reducing the risk.10 By 2012, API had begun developing methane, a potent greenhouse gas, as In response to the NTSB’s safety additional guidance for the safety of well as numerous other pollutants.16 recommendation, RSPA held a public UNGSFs. API developed RP 1170 and Additional reports identified other meeting 11 to determine what actions it 1171 over several years, based on input potential health effects that lasted even should take, if any, regarding the from many industry stakeholders, after the well was sealed. A report by regulation of underground storage of including regulators such as PHMSA, the Los Angeles County of Public Health natural gas and hazardous liquids. The FERC, and five State regulatory suggests that the continued health participants expressed mixed views on agencies, as well as the API Midstream symptoms may be due to contaminants 17 whether RSPA should begin to regulate Group. In July 2015, API issued RP in indoor air and dust. As of December ‘‘downhole’’ pipe and underground 1170, ‘‘Design and Operation of 31, 2016, SoCalGas and its parent storage. Most participants spoke Solution-mined Salt Caverns Used for company, Sempra Energy, recorded favorably of industry safety practices Natural Gas Storage.’’ API RP 1170 estimated costs of $913 million to and State regulation but saw no provides recommendations and control the release, monitor air requirements for geo-mechanical emissions, relocate residents, and cover immediate need for Federal regulatory 18 action. assessments, cavern well design and legal and other expenses. The singular drilling, solution mining techniques, well that failed in the Aliso Canyon On July 1, 1997, RPSA issued an operations and maintenance procedures, accident (SS–25) had originally been advisory bulletin (ADB–97–04) to and practices for salt caverns. In drilled in 1953 and was re-purposed for inform UNGSF owners and operators of September 2015, API issued RP 1171, natural gas storage in 1972. The age of the availability of guidelines for the ‘‘Functional Integrity of Natural Gas this well is not unusual. Per data from design and operation of underground Storage in Depleted Hydrocarbon the American Gas Association (AGA), storage facilities. Specifically, the Reservoirs and Aquifer Reservoirs,’’ approximately 60 percent of active advisory bulletin pointed to the safety which focuses on storage well, reservoir, storage wells are located in fields that standards guide from the Interstate Oil and fluid management for functional were activated before 1960. and Gas Compact Commission integrity in design, construction, The Aliso Canyon incident created 12 (IOGCC) and API as appropriate for operations and maintenance procedures, serious energy-supply challenges for the use by pipeline operators and State monitoring, and documentation region and prompted public concerns regulatory agencies. The IOGCC guide practices. The RPs appropriately about the safety of UNGSFs, including provided safety standards for the design, recognize the variety and diversity of the extent and effectiveness of Federal construction, and operation of gas UNGSFs used throughout the United and State oversight. On February 5, storage caverns. API had published States and are not limited to addressing 2016, PHMSA issued an advisory guidelines for the underground storage facilities in a single State, basin, bulletin (ABD–2016–02), identifying of liquid hydrocarbons. RP 1114, geological setting, or well type. specific minimum actions that operators ‘‘Design of Solution-Mined of UNGSFs should take, in addition to Underground Storage Facilities,’’ June C. Aliso Canyon Incident the recommendations of ADB–97–04, 1994, provided basic guidance on the Shortly after the publication of the design and development of new industry safety standards RP 1170 and 14 For example, see KPCC news report on August solution-mined underground storage RP 1171, another major UNGSF incident 4, 2016, ‘‘Cost estimate of Aliso Canyon gas leak facilities. RP 1115, ‘‘Operation of hits $717 million’’. http://www.scpr.org/news/2016/ occurred. On October 23, 2015, 08/04/63268/cost-estimate-of-aliso-canyon-gas- Solution-Mined Underground Storage Southern California Gas Company leak-hits-717-mi/. Facilities,’’ September 1994, provided (SoCalGas) discovered a leak that 15 CARB estimates that the incident resulted in a guidance on the operation of solution- manifested into the largest methane leak total emission of 99,650 ± 9,300 metric tons of mined underground hydrocarbon liquid methane (CARB, 2016a) and seeks mitigation of from a natural gas storage facility in U.S. 109,000 metric tons. or liquefied petroleum gas storage history. Well SS–25 in the Aliso Canyon 16 California Air Resources Board (CARB), 2016; facilities. storage field, located in Los Angeles County of Los Angeles Public Health. Another catastrophic natural gas leak County, California, leaked for nearly 17 Ibid. CARB. happened in January 2001 after a four months until it was permanently 18 Of the $913 million of costs, approximately 60 percent is for the temporary relocation program wellbore failed at the Yaggy storage field sealed on February 17, 2016. While (including cleaning costs and certain labor costs). near Hutchinson, Kansas. The natural SoCalGas attempted to plug the leak, Other estimated costs include amounts for efforts to gas migrated nine miles underground, residents in nearby neighborhoods control the well, stop the Leak, stop or reduce the where it eventually surfaced through experienced health symptoms emissions, and the estimated cost of the root cause analysis being conducted by an independent third abandoned wells. Once at the surface, consistent with exposure to the odorants party to investigate the cause of the Leak. The the natural gas exploded, killing two (mercaptans) added to natural gas and remaining portion of the $913 million includes people and destroying two businesses.13 residual components from previous oil legal costs incurred to defend litigation, the value production in the field. The incident of lost gas, the costs to mitigate the actual natural gas released, the estimated costs to settle certain 10 National Transportation Safety Board, Pipeline temporarily displaced more than 5,000 actions and other costs. The value of lost gas Accident Report PAR–93/01 (Nov. 4, 1993). households from their homes, according reflects the replacement cost of volumes purchased 11 (Docket PS–137, 59 FR 30567, June 14, 1994). to the Aliso Canyon Incident Command through December 2017 and estimates for purchases 12 Interstate Oil and Gas Compact Commission, in 2018. As of mid-January 2018, SoCalGas has ‘‘Natural Gas Storage in Salt Caverns: A Guide for briefing report issued on February 1, replaced all lost gas. SoCalGas adjusts its estimated State Regulators.’’ (IOGCC Guide), 1995. total liability associated with the Leak as additional 13 Allison, M. Lee, 2001, The Hutchinson Gas Bar Association, 26th Annual KBA/KIOGA Oil and information becomes available.’’ (SoCalGas/Sempra, Explosions: Unraveling a Geologic Mystery, Kansas Gas Law Conference, v1, p3–1 to 3–29. 2018).

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API RP 1170, API RP 1171, and the 1.97). PHMSA fulfilled this mandate by gas can impact well integrity. Wells in IOGCC Guide. The 2016 advisory publishing the IFR on December 19, depleted oil fields may have been bulletin recommended that operators 2016. The PIPES Act provides that states designed for lower operating pressures begin reviewing their operating, may adopt additional or more stringent than what they may be subject to now. maintenance, and emergency response safety standards for intrastate UNGSFs if Many of these wells were designed activities and apply the new RPs such standards are compatible with without redundant barriers to reduce accordingly. these Federal regulations. the risk of gas migration. One of the On July 14, 2016, PHMSA held a lessons from the Aliso Canyon incident public meeting to discuss potentially E. Interagency Task Force is that wells without redundant barriers extending its regulations to include In addition to section 12 of the PIPES present higher risks because they have transportation-related UNGSFs. PHMSA Act, Congress included a second heard from a diverse group of mandate, section 31, directing the a single point of possible failure that stakeholders, including State regulators, Department of Energy (DOE) to establish may be extremely difficult to shut off or emergency responders, and residents, an Interagency Task Force on Natural kill. including those impacted by the Aliso Gas Storage Safety to perform an F. Interim Final Rule Canyon incident. PHMSA concluded analysis of the Aliso Canyon events and that it should take action to incorporate make recommendations to reduce the On December 19, 2016, PHMSA by reference API RP 1170 and API RP occurrence of similar events in the issued the IFR that satisfied section 12 1171 into part 192. The RPs describe a future. PHMSA and DOE co-led the of the PIPES Act, exercising the agency’s range of measures that UNGSF operators effort. The Task Force established statutory authority to regulate should undertake to ensure the safe several working groups, comprised of underground natural gas storage operations of their facilities. The RPs premier scientists, engineers, and facilities. The IFR amended the pipeline also include construction, maintenance, technical experts from the Executive safety regulations found at 49 CFR parts Office of the President and various IM, security, and emergency response 191 and 192, to address critical safety Federal agencies. The working groups procedures. issues related to ‘‘downhole’’ UNGSF examined three key areas: D. The PIPES Act of 2016 • The integrity of natural gas wells at facilities, including wells, wellbore The Aliso Canyon incident prompted storage facilities; tubing, casing, and wellheads (81 FR broader public concerns as to how to • The public health and 91860). Additionally, the IFR added a prevent similar UNGSF accidents in the environmental effects from natural gas definition of ‘‘underground natural gas future. Congress addressed these leaks; and storage facility’’ to §§ 191.3 and 192.12 concerns in two sections of the PIPES • The nation’s vulnerability to and applied reporting requirements to Act, enacted on June 22, 2016 (Pub. L. reduced energy reliability in the event operators of UNGSFs similar to those 114–183). Section 12 of the PIPES Act of future leaks. applicable to operators of other gas required PHMSA to issue minimum In October 2016, the Task Force pipeline facilities, including annual safety standards for all UNGSFs within issued its final report on natural gas reports, incident reports, reports of two years of enactment. The statute storage safety and made 44 major construction and organizational defines an ‘‘underground natural gas recommendations to operators and changes, and registration with the storage facility’’ as a ‘‘gas pipeline regulators. The main recommendation National Operator Registry. facility that stores natural gas in an to PHMSA was to incorporate existing Effective January 18, 2017, all underground facility.’’ Because title 49 industry consensus standards, API RP United States Code (U.S.C.) 60101(a) 1170 and 1171, into part 192 of the UNGSFs, both intrastate and interstate, already defines ‘‘gas pipeline facility’’ as regulations in an enforceable manner, now had to meet the minimum ‘‘a pipeline, a right of way, a facility, a and consider supplementing the standards outlined in RPs 1170 and building, or equipment used in regulations with recordkeeping and 1171 and were subject to inspection by transporting gas or treating gas during reporting requirements as necessary. PHMSA or a PHMSA-certified State its transportation,’’ PHMSA interprets The Task Force recommended that entity. The IFR made each provision in the PIPES Act as directing it to regulate operators develop comprehensive risk- the RPs 1170 and 1171 mandatory only those UNGSFs that store natural management plans that addressed risks unless the operator documented a gas incidental to transportation. based on their potential severity and technical justification why compliance The PIPES Act requires that in issuing probability of occurrence. These plans with a provision was not practicable minimum safety standards for UNGSFs, should document an operator’s risk- and not necessary for safety. Operators PHMSA must: (1) Consider consensus management strategy, identify risks, were required to incorporate the RPs standards for the operation, define responsibilities among into their written operations, environmental protection, and integrity stakeholders, assess risks, and take maintenance, and emergency response management of underground natural gas appropriate action to reduce risks to program manuals following § 192.605. storage facilities; (2) consider the well integrity. PHMSA, or a certified State partner, economic impacts of the regulations on The Task Force’s report also would review any of the operators’ individual gas customers; (3) ensure that highlighted growing concerns regarding justifications and its procedure manuals the regulations do not have a significant the age of the nation’s natural gas during compliance inspections. economic impact on end users; and (4) storage infrastructure. For example, After publishing the IFR, PHMSA consider the recommendations of the wells reflect material, technology, and took significant steps to educate the Aliso Canyon natural gas leak task force design factors that may have been established under section 31 of the appropriate at the time they were regulated community on the new PIPES Act of 2016. constructed, but may not meet design requirements, to promote a better The Secretary of Transportation (the criteria for wells drilled today. Over understanding of issues concerning Secretary) delegated this responsibility time, corrosion, other environmental integrity assessments of UNGSFs and under chapter 601 of title 49 U.S.C. to processes, and mechanical stresses from the implementation of the RPs. The first the PHMSA Administrator (49 CFR the injection and withdrawal of natural action was to publish frequently asked

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questions (FAQs).19 The FAQs provided standards for natural gas storage. They • Dow Chemical Company (Dow) guidance on the procedures, stressed the importance of adopting the • ENSTOR implementation plans, and schedules RPs to advance the safety of the pipeline • Environmental Defense Fund (EDF) that operators should have in place to transportation system but asked PHMSA • Gas Free Seneca meet the requirements in the applicable to revise the IFR to incorporate RP 1170 • Gas Piping Technology Committee RPs. For example, while the IFR did not and API RP 1171 without modification (GPTC) provide clear timelines for operators to and to provide for reasonable • Geological Maps Foundation complete the integrity assessments implementation periods. The • GPA Midstream Association (GPA) required by the RPs, the FAQs provided Associations stated that the changes • Hilcorp Alaska • a recommended implementation requested in the petition would ensure Hon. Brad Sherman, representing 30th schedule. With the issuance of this final that PHMSA’s regulations would be Congressional District of California • rule, PHMSA will revise the FAQ practical, reasonable, and effective. Independent Petroleum Association of guidance material to reflect these On June 20, 2017, PHMSA issued a America (IPAA) • regulations as amended. notice stating that it would provide an Joint Comment from American Gas In preparation for the development of answer to the petition in the final rule Association (AGA), the American inspection and enforcement efforts, (82 FR 28224). PHMSA announced that Petroleum Institute (API), the PHMSA subject matter experts in the interim, it would not issue any American Public Gas Association conducted preliminary site assessments enforcement citations for failure to meet (APGA), and the Interstate Natural at a cross-section of UNGSFs from May any of the non-mandatory provisions of Gas Association of America (INGAA) • to July of 2017. the RPs that the IFR converted to Joint Comment from the States First Additionally, PHMSA has instituted a mandatory ones until one year after the Initiative, the Interstate Oil and Gas program for training Federal and State issuance the final rule. PHMSA has Compact Commission (IOGCC), and inspectors on the new minimum Federal considered the recommendations from Groundwater Protection Council standards affecting all UNGSF facilities. the Associations and is answering their (GWPC) • As it promulgates this final rule, petition in this final rule. Louisiana Mid-Continent Oil and Gas PHMSA is prepared to modify the Association (LMOGA) program through future regulations and III. Comment Summaries and PHMSA’s • Michigan Department of guidance to keep pace with evolving Responses Environmental Quality • consensus safety standards, academic A. Introduction New York State Department of research, and lessons learned from the Environmental Conservation firsthand experience of its inspectors, PHMSA received 82 comments and • Northern Natural Gas State regulators, affected stakeholders, one petition for reconsideration in • Pacific Gas and Electric Company and the public. response to the IFR issued on December (PG&E) 19, 2016. PHMSA provided a 60-day • Private Citizens (50) G. Petition for Reconsideration comment period initially but re-opened • Railroad Commission of Texas On January 18, 2017, the American it on October 19, 2017 (82 FR 48655), for • Southern California Gas Company Gas Association (AGA), American an additional 30 days to provide all (SoCalGas) Petroleum Institute (API), American interested parties with the opportunity • Texas Pipeline Association Public Gas Association (APGA), and to comment on the IFR and the merits • TransCanada Interstate Natural Gas Association of and claims of the petition for • Vectren America (INGAA) (the ‘‘Associations’’) reconsideration. During the initial 60- jointly filed a petition for day comment period, PHMSA received B. Incorporation by Reference of API reconsideration of the IFR. AGA 28 comments. PHMSA received 54 Recommended Practices 1170 and 1171 represents local energy companies, as additional comments during the re- In the IFR, PHMSA required operators well as residential, commercial, and opened 30-day comment period, but to treat non-mandatory language in the industrial natural gas customers. API is only 14 of those 54 related to this RPs as mandatory. For each provision a national trade association representing rulemaking.21 Half of those 14 modified by the IFR, an operator could the oil and natural gas industry, comments were from organizations that deviate from the recommended practice including gas pipelines and UNGSF had already submitted comments during by providing in its procedures manual operators. APGA is a national, non- the initial, 60-day comment period. a technical justification for each profit association of publicly-owned PHMSA discusses and responds to deviation. Under the IFR, PHMSA natural gas distribution systems. INGAA these comments and recommendations required an operator to use a subject is an industry trade association in sections B through J, below. For matter expert to review and document representing interstate natural gas organizational purposes, PHMSA has the technical justification, and a pipeline companies in the United grouped comments by subject matter. member of the operator’s executive States.20 Below is a list of entities who submitted leadership was required to review, In the petition, the Associations comments on the IFR. approve, and document the date of affirmed their support for PHMSA’s • Atmos Energy approval. During routine inspections, efforts to regulate the safety of UNGSFs. • Consumers Energy PHMSA would review an operator’s They reminded PHMSA that the justifications for deviating from the Associations and their members had 21 The 40 comments that PHMSA deemed not modified provisions. supported PHMSA’s incorporation by relevant appear to have been submitted reference of the RPs as Federal anonymously using automated technology (i.e., 1. Comments on PHMSA’s Modification bots). While these comments raise generalized of the RPs issues related to environmental protection (climate 19 ‘‘Underground Natural Gas Storage: FAQs.’’ change, renewable/alternative energy, streamlining Many commenters disagreed with (revised April 2017) https://primis.phmsa.dot.gov/ environmental reviews, etc.), the comments do not PHMSA’s modification of the non- ung/faqs.htm. connect their generalized statements to any of the 20 On April 17, 2017, INGAA withdrew from the specific provisions of this rulemaking, such that mandatory provisions of the RPs. petition for reconsideration, but the other three they would become meaningful to the issue of the Almost all commenters supported the Associations have remained as petitioners. safety of underground natural gas storage systems. Associations’ position concerning the

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conversion of the non-mandatory of RP 1171 to mandatory provisions 2. PHMSA’s Response to Comments on provisions in RPs 1170 and 1171 to could establish statutorily- Its Modification of the API RPs 1170 mandatory. Generally, commenters impermissible retroactive requirements, and 1171 supported the need for consistent such as requiring the use of observation After considering the petition for minimum safety standards for all wells drilled around, above, and below reconsideration and public comments, UNGSFs and supported regulations to a reservoir. ENSTOR added that PHMSA PHMSA is accepting the that effect. Those same commenters ‘‘can simply require operators to recommendation to adopt the RPs 1170 asserted that if PHMSA adopted the IFR discontinue any deviations that the and 1171 as originally written by API, without modification, it would impose agency does not agree with,’’ and ‘‘there without modification. When drafting the burdensome and impracticable are no standards to guide the agency’s IFR, PHMSA needed to provide an requirements on operators. determination and no means for review immediate and reasonable means by In their petition, the Associations or appeal of a denial of an operator which it could begin regulating stated that ‘‘changing the [RPs] in this deviation.’’ UNGSFs, while, at the same time, manner is not necessary for Some operators stated that the process implementing sections 12 and 31 of the enforcement, nor is it practicable or for justifying deviations from a specific PIPES Act. As discussed earlier, section reasonable.’’ The Associations stated non-mandatory RP would be time- their belief that there was ‘‘no regulatory intensive, expensive, and unworkable 12 of the PIPES Act required PHMSA to justification for making all ‘non- for many operators. LMOGA stated that consider existing industry standards mandatory’ provisions ‘mandatory,’ ’’ requiring technical documentation for and recommendations from the and requested that PHMSA eliminate each deviation was excessive since the Interagency Task Force (created by this provision. Further, the Associations RPs themselves already identified the section 31) as the basis for its pending said that although the RPs use both non- non-mandatory practices as applicable regulations. In its 2016 report, the mandatory and mandatory language, on a case-by-case and site-specific basis. Interagency Task Force recommended this alone does not affect their Further, LMOGA noted that the IFR that PHMSA consider ‘‘incorporating enforceability. They said that the RPs required each deviation must be existing industry-recommended contain enough mandatory provisions to ‘‘technically reviewed and documented practices API RP 1170 and 1171 into the ensure enforceability. The Associations by a subject matter expert to ensure that part 192 regulations, and they should be used the mandatory provisions in there will be no adverse impact on the adopted in a manner that can be section 8 to demonstrate that the RPs are facility. . . .’’ LMOGA argued that the enforced.’’ Historically, PHMSA has broad enough, as written, to be term ‘‘subject matter expert’’ was vague successfully incorporated by reference enforced. Additionally, they stated that and imprecise. many industry standards, guidance, and the non-mandatory statements in the EDF said that PHMSA would not be recommended practices in lieu of RPs do not compromise the reviewing an operator’s technical developing its own regulations. enforceability of the broad requirements justifications until after the operator had After additional review, PHMSA has imposed on operators through the already deviated from a recommended determined that adopting the RPs as mandatory provisions. practice and contended that this could originally published by API would still The Texas RRC stated that it strongly allow harmful activities to persist until provide significant benefits for safety, disagreed with PHMSA’s modification an inspection took place at the facility. the environment, and public health but of the RPs. The Texas RRC noted that Further, EDF said that operators might would be much easier for the regulated the wholesale adoption of RPs would make significant financial commitments industry and the public to understand lead to confusion and have unintended in reliance on unapproved deviations, and for PHMSA to interpret and enforce. consequences. It said that if PHMSA only to see their decisions overturned The non-mandatory provisions in the kept the modification to the non- after the fact, without practical recourse, RP provide operators with guidance for mandatory provisions in the final rule, by PHMSA. Regarding the IFR’s optional considerations based on the it would undermine the integrity of the treatment of non-mandatory provisions features and characteristics of original RPs, ultimately making them as mandatory, EDF stated its preference individual storage facilities. However, even more difficult to enforce. Lastly, would be for PHMSA to adopt the API the RPs still require all operators to the Texas RRC stated that, while the IFR RPs but examine the non-mandatory develop policies and procedures to allowed an operator to deviate from provisions of the API RPs on a ensure the functional integrity of particular provisions, PHMSA did not provision-by-provision basis to UNGSFs and to inspect and verify the provide a process or timeframe by determine if any should be made operational integrity of these facilities which the agency would review, mandatory, and adopt additional on a site-specific basis and will provide approve, or deny the operator’s regulatory requirements to fill in PHMSA with a stronger basis upon alternative procedure(s). The Texas RRC potential gaps in the final rule. which to base enforcement than the IFR. requested that, if PHMSA chose to TransCanada, which participated in As the Associations pointed out in incorporate the RPs as modified by the the development of RP 1171, stated that their petition for reconsideration, the IFR, the agency should add a review the inclusion of both ‘‘should’’ and existence of ‘‘non-mandatory provisions process and timeline for consideration ‘‘shall’’ in the RPs reflected a deliberate, in the RPs does not affect their overall of requests for deviation from the iterative, consensus-building effort that enforceability.’’ Throughout the RPs, modified provisions. resulted in the selection of those there are many broad mandatory ENSTOR Operating Company, LLC specific words. TransCanada went on to provisions that operators of UNGSFs (ENSTOR), asserted that converting all say that it would not be prudent to make must implement, using a range of non-mandatory provisions in the RPs to such recommendations mandatory options considered in accompanying mandatory requirements would because doing so could lead to a non-mandatory provisions. The non- undermine the risk-based approach of misplaced effort to document mandatory provisions provide operators the RPs and create unintended results. exceptions when operators should be with illustrations, examples, or choices ENSTOR stated that PHMSA’s focusing on the imperatives of IM and of action for how to achieve compliance conversion of non-mandatory RP the development of effective with the mandatory provisions. Because statements in sections 8, 9, 10, and 11 procedures. these non-mandatory provisions are

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closely tied to the mandatory provisions monitoring, threat and hazard PHMSA had intended to require that operators must meet, any non- identification, assessment, remediation, operators to implement all actions mandatory provision remains site security, emergency response and under the applicable sections of the RPs enforceable to the extent that it is preparedness, and recordkeeping within one year. In their comment, the necessary, in the context of a particular provisions of the applicable RPs within Associations spoke of an operator that operator or facility, to ensure one year from the effective date of the had recently implemented the RPs at its compliance with a mandatory provision IFR, i.e., January 18, 2018. Specifically, facility. The operator reported that it in the Recommended Practice. existing UNGSFs using a solution- took over 18 months to gather the Based on the petition for mined salt cavern for storage were subject matter experts and complete the reconsideration, the post-IFR comments required to meet the requirements of RP integrity plans and operating received, as well as its experience with 1170, sections 9, 10, and 11, and procedures. The Associations added the application and enforcement of operators of existing UNGSFs using a that operators should expedite the similar consensus standards and depleted hydrocarbon reservoir or an implementation of preventive and recommended practices, PHMSA aquifer reservoir for gas storage were mitigative measures for high-risk or believes that adopting the RPs in their required to meet the requirements of RP imminent-risk facilities, as identified by original published form, will 1171, sections 8, 9, 10, and 11, by the their risk assessments. accomplish the goal of the IFR, which same date. Similarly, TransCanada stated that it was to improve safety. The means of Following the publication of the IFR was impractical to implement the IFR achieving this goal was to establish, for on December 19, 2016, PHMSA by January 18, 2018, and asked that the first time, minimum Federal safety published FAQ guidance (April 2017) to PHMSA clarify in the final rule what the standards that would require operators assist operators in applying the RPs. The agency expected operators to have of all UNGSFs to meet certain basic, FAQs included a suggested timeline for achieved by January 18, 2018, and uniform, and risk-based policies and operators to complete the risk analysis beyond. TransCanada agreed, with procedures as outlined in the RPs. In and baseline assessments for the certain reservations, that baseline risk evaluating regulatory alternatives, requirements in the IFR. assessments could begin within one to PHMSA did consider adopting a portion two years of the effective date of the of the ‘‘should’’ provisions to identify 1. Comments on the Compliance final rule. They also agreed that three to and address any potential gaps, but Timelines eight years was enough time to complete PHMSA ultimately decided not to PHMSA gave operators one year from risk assessments for all individual wells because the Agency does not have the effective date of the IFR to comply at UNGSFs. sufficient information to identify with the IFR. Commenters stated that 2. Response to Comments on the whether there are ‘‘should’’ statements the timeline for compliance provided in Compliance Timelines that are, on average, more or less the IFR was unreasonable, and practical and necessary at each site, and PHMSA’s expectations for operators PHMSA is accepting the commenters’ thus would be more or less likely to were unclear. Commenters requested recommendations to reconsider the cause operators to seek deviations. In that the final rule adopt phased-in compliance timelines in the final rule. light of this factor and the comments compliance timelines, as PHMSA has These timelines are similar to the ones received, PHMSA is convinced that done in previous rulemakings. Most published PHMSA’s Underground treating the non-mandatory provision as commenters recommended that PHMSA Natural Gas Storage FAQs (April 2017). written in the RPs is the better course follow the timelines published in its Below is a summary of the compliance of action because it adds clarity to the Underground Natural Gas Storage FAQs timelines for implementing a UNGSF provisions which should help improve (April 2017). program. compliance while providing at least an Most industry commenters asked that Deadline for Written Procedures equivalent level of safety as the IFR. PHMSA modify the compliance The IFR and this final rule are timelines to break it up into phases and Consistent with the IFR, operators PHMSA’s first effort to establish a extend the overall schedule, similar to must prepare and follow written national regulatory program for what the FAQs outlined, which procedures for the operations, UNGSFs. This program includes suggested that operators complete the maintenance, and emergency features such as basic reporting baseline integrity assessments of each management and response activities requirements, Federal and State storage field within three to eight years. outlined by the applicable RPs. inspections, and a Federal-State These commenters agreed that the However, this final rule removes the partnership that will enable States to go FAQ’s timelines for baseline integrity requirement in the IFR that these beyond the RPs by adding additional or assessments were realistic and that any procedures be incorporated into an more stringent requirements. As the shorter timeframe was unrealistic and operator’s existing procedural manuals agency and the industry gain experience impracticable. They supported required for gas pipelines under implementing this new regulatory including clear, phased-in timelines in § 192.605. Instead, the final rule program, they will learn what the final rule. Most said it would take replaces this provision with a similar improvements need to be made. If longer than 12 months to implement all requirement that UNGSF operators experience shows that the RPs do not aspects of the RPs fully and that the develop written procedures for carrying provide an adequate level of safety for PHMSA should extend the compliance out the final rule and maintain and certain activities or risks, PHMSA will deadline. update them in a similar fashion as consider the need to modify the The Associations requested that the required by § 192.605 for gas pipelines. regulations, as appropriate. final rule incorporate the risk In the final rule, the new requirement is in a new paragraph exclusive to C. Compliance Timelines assessment and integrity-management timelines currently outlined in the UNGSFs under § 192.12. The IFR required that UNGSFs FAQs.22 The Associations doubted that Accordingly, operators must establish constructed before July 18, 2017, meet and follow written procedures for all operations, maintenance, integrity 22 ‘‘Underground Natural Gas Storage FAQs,’’ implementing their UNGSF programs. demonstration and verification, issued by PHMSA in April 2017. By January 18, 2018, all operators with

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facilities constructed on or before July assessments of all reservoirs and other pipeline facilities to UNGSFs—or 18, 2017, must have established and put caverns by the same date. By seven vice-versa. The RPs contain design, into service procedures for operations, years after the effective date of this final construction, and IM practices for maintenance, and emergency rule, operators must have completed UNGSFs that the Associations believed preparedness. All other operators must baseline risk assessments for all are considerably different from the have these procedures in place prior to remaining wellbores, wellheads, and practices for other pipeline facilities commencing operations. Operators must associated components. This outlined throughout part 192. They also establish an interval for reviewing implementation period is similar to the provided examples of regulations that, if and updating these written procedure one published in PHMSA’s misapplied, might result in unsafe manuals, not exceeding 15 months, but Underground Natural Gas Storage FAQs practices. The Associations asserted that at least once each calendar year. (revised April 2017).23 PHMSA could avoid these potential conflicts by placing the UNGSF D. Placement of Underground Storage Integrity Management Framework regulations in a new part under 49 CFR Regulations in a New Part for Title 49 By January 18, 2018, all operators subchapter D, separate from part 192. of the 49 CFR with facilities constructed on or before Several commenters, including Dow July 18, 2017, must have established a The IFR added requirements in parts Chemical Company, claimed that framework for IM under the IFR. All 191 and 192 for UNGSFs that cover adding underground storage regulations other operators must have this reporting, recordkeeping, design, to part 192 would generate confusion. framework in place prior to construction, and operation and Specifically, commenters said that the commencing operations. An initial maintenance procedures and practices. IFR was unclear as to which sections of framework means a written explanation Before the IFR, there were no Federal part 192 applied to UNGSFs and which of the mechanisms or procedures the regulations pertaining directly to ones to other gas pipeline facilities. The operator will use to implement each UNGSFs. While part 192 already GPTC expressed the view that the program and API RP to ensure covered much of the surface piping at definition of underground natural gas compliance with this final rule. These these facilities, up to the wing-valve storage facilities in § 192.3 overlapped procedures, implementation framework, assemblies on the wellhead at UNGSFs with the existing definitions of pipeline and schedules do not need to be fully served by pipeline, PHMSA had not facilities and transmission pipelines and fleshed out but must be sufficient for previously issued rules for the actual that it believed PHMSA intended to putting the program in place over the wellhead or ‘‘downhole’’ portion of expand the regulatory scope of parts 191 long term. PHMSA expects that each these facilities. and 192 to UNGSFs. However, GPTC implied that the overlap between the operator’s implementation framework 1. Comments Requesting a New Part for new definitions and the new and schedules will evolve into a more Title 49 of the CFR detailed, comprehensive, and robust regulations’ placement in part 192 program as the operator’s program The IFR amended parts 191 and 192 would create confusion as to the matures. An operator must make to add underground natural gas storage applicability of the RPs to pipeline continual improvements to the program. regulations. For several reasons, facilities already regulated under other The IM framework for a UNGSF must commenters requested that PHMSA subparts of part 192. include: create a new ‘‘part 19x’’ in subchapter Similarly, PG&E requested that the • A plan for developing and D of title 49 of the CFR that would final rule revise the pipeline safety implementing each program element; contain regulations exclusively for regulations to specify which parts of 49 • An outline of the procedures to be underground storage. Generally, their CFR subchapter D applied to developed; interest was in differentiating the underground natural gas storage, instead • The roles and responsibilities of requirements for UNGSF from those of providing clarification through UNGSF staff assigned to develop and requirements for other types of agency guidance materials (e.g., FAQs). implement the procedures; regulated gas facilities. They stated that PHMSA historically • A plan for how staff will be trained The Associations and some operators had not incorporated FAQs addressing in awareness and application of the recommended that PHMSA remove the additional programs, such as ‘‘Integrity procedures; underground storage regulations from Management,’’ ‘‘Drug and Alcohol • Timelines for implementing each part 192 and place them in a new part Testing,’’ and ‘‘Gathering Lines,’’ into program element, including the risk under subchapter D in 49 CFR. They regulatory language. PG&E stated that it analysis and baseline risk assessments; asserted that moving UNGSF regulation believed this practice would leave and to a new part in the pipeline safety operators at risk of being forced to • A plan for how to incorporate regulations would clarify the comply with requirements that did not information gained from experience into application of the regulations both now appear in regulatory language. the IM program on a continuous basis. and in future rulemakings. The Therefore, PG&E encouraged PHMSA to commenters stated that because the clarify § 192.12 by adding an exclusion Timelines for Conducting Risk existing definitions of pipeline and for the subparts of part 192 that would Assessments pipeline facility in § 192.3 were so not apply to underground natural gas By four years after the effective date similar to the definition of underground storage. Other commenters shared this of this final rule, each operator must natural gas storage facility (also in view and expressed concern that have completed baseline risk § 192.3) that it was unclear how to apply PHMSA would attempt to use FAQs or assessments for 40 percent of all its the regulations. similar guidance documents instead of wellbores, wellheads, and associated The Associations also expressed properly promulgated regulations. components. Operators should generally concern that because the IFR placed the prioritize assessments on higher-risk underground storage regulations in part 2. Response to Commenters’ Request for wells first, based on a matrix of 192, operators might mistakenly apply a New Part identified threats, hazards, and the the engineering regulations specific to Section 60101(a)(21) defines the term likelihood of their occurrence. ‘‘transporting gas’’ as ‘‘the gathering, Operators must complete baseline 23 https://primis.phmsa.dot.gov/ung/faqs.htm. transmission, or distribution of gas by

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pipeline, or the storage of gas, in Any operator of a ‘‘pipeline facility’’ that the RPs were more suitable as interstate or foreign commerce.’’ The that is subject to any subset of the part guidance material for operators. statute specifically lists the ‘‘storage’’ of 192 regulations is required to test Most private citizens urged PHMSA to natural gas as one component of covered employees for the presence of go beyond the safety provisions in the ‘‘transporting gas.’’ Since all PHMSA’s prohibited drugs and alcohol. PHMSA RPs. Notably, these commenters substantive regulations pertaining to the also explained in the FAQs that expressed concern over the lack of a transportation of natural gas are in part operators of UNGSFs were not required specific ‘‘risk management’’ section in 192, PHMSA believes the UNGSF to comply with the ‘‘Qualification of RP 1170 for solution-mined salt caverns. regulations also belong in part 192. Pipeline Personnel’’ requirements They asked that the final rule provide Along with the public comments, contained in subpart N of 49 CFR part additional risk management practices PHMSA reviewed recommendations 192. The FAQs explained that operators for solution-mined salt caverns. from the Interagency Task Force and a must comply with the training A few commenters were concerned petition for rulemaking from INGAA. requirements in API RP 1170 (section that the provisions in the RPs were The Task Force recommended that 9.7.5) or API RP 1171 (section 11.12), vague, ambiguous, and insufficient in PHMSA incorporate the RPs into part dependent upon the type of storage detail. For instance, States First said 192, with supplemental recordkeeping field. Both API RP sections describe that while the RPs contain substantial and reporting procedures as necessary. general training parameters and information and guidance for operators, The IFR noted that INGAA had specifically identify the need to train ‘‘it is [States First’s] belief that [the RPs] petitioned PHMSA on January 20, personnel for normal, abnormal, and require considerable wording revisions 2016—while the Aliso Canyon accident emergency conditions. Additionally, and additions to make them effective as was still ongoing—to incorporate the this final rule makes it clear that regulations.’’ Similarly, MDEQ stated RPs into part 192. Because UNGSFs are UNGSFs are not subject to any that the IFR lacked clear timeframes and part of the broader natural gas requirements of part 192, aside from provided little regulatory oversight and transportation systems, part 192 is the § 192.12. approvals for certain actions taken. most logical place for the new MDEQ expressed concern that in many substantive regulations. Incorporating E. Suitability of API RPs 1170 and 1171 instances, the IFR left it up to operators the requirements into parts 191 and 192 as the Basis for Rulemaking to determine the risks facing their facilities and the methods for addressing also subjects UNGSF operators to the In the IFR, PHMSA incorporated by them. It went on to say that IFR created requirements of part 190, for reference two industry Recommended inconsistencies and uncertainties in enforcement and regulatory procedures, Practices, API RPs 1170 and 1171, into providing the level of protection and part 199, for drug and alcohol 49 CFR part 192. testing. Therefore, PHMSA had adopted needed. These inconsistencies and these recommendations and by adding 1. Comments Concerning the Suitability uncertainties in the IFR, in turn, could the UNGSF regulations in parts 191 and of the RPs for Rulemaking make it difficult for State regulators to 192. address safety issues for intrastate gas PHMSA agrees that the language in PHMSA used RPs 1170 and 1171 as storage operations by implementing the IFR resulted in a certain level of the foundation for the new minimum additional regulations beyond the IFR. ambiguity about the applicability of safety standards for UNGSFs. 2. Response to Comments Concerning § 192.12 to other gas pipeline facilities Commenters cited the forewords of both the Suitability of the RPs for and, vice versa, the applicability of RPs, which state that the RPs were not Rulemaking other existing regulations to UNGSFs. intended to substitute for Federal or PHMSA has addressed this issue by State regulations as the basis for PHMSA disagrees with the making two changes in this final rule. objecting to their use as the basis for commenters’ broad assertion that the First, PHMSA is adding an introduction new regulatory requirements. Other API Recommended Practices are an to § 192.12, which provides that the commenters identified potential gaps in inadequate basis for regulations. section contains minimum requirements regulatory coverage in the RPs, such as PHMSA routinely participates in for UNGSFs. This introduction means to risk management practices for solution- consensus-standards-setting clarify that § 192.12 only applies to mined salt caverns. For these reasons, organizations that address pipeline UNGSFs and no other pipeline facilities. commenters stated that the RPs were not design, construction, maintenance, Second, the final rule also modifies the an adequate basis for regulation. inspection, and repair. These standards definition of a UNGSF to eliminate any Some commenters were concerned represent the best practices of the potential overlap with other gas with the suitability of the RPs as the industry and, therefore, should be pipeline facilities covered elsewhere in basis for regulations. Texas RRC and considered in the development of part 192. EDF criticized PHMSA’s approach to potential regulation. Agency PHMSA also agrees with the incorporating the RPs into the participation in the development of commenters that the FAQs are guidance underground natural gas storage these voluntary consensus standards is documents to help operators understand regulations. The Texas RRC stated that vital to eliminate the necessity for and implement rulemakings. FAQs are the RPs were neither drafted nor development or maintenance of not the basis for PHMSA’s enforcement intended to operate with the force and separate, government-unique standards. of the rule. However, they can and effect of Federal regulations and, as Further, the PIPES Act specifically should be used to clarify or explain such, should not be adopted as written. directs the Secretary to consider PHMSA’s interpretation of the scope Similarly, EDF pointed to the scope ‘‘consensus standards for the operation, and applicability of the regulation. For section of RP 1170, which states that the environmental protection, and integrity example, while not explicitly stated in document is ‘‘intended to supplement, management of underground natural gas the preamble or the amendatory but not replace, applicable local, State, storage facilities’’ and ‘‘the language of the IFR, PHMSA explained and Federal regulations.’’ Both the recommendations of the Aliso Canyon through FAQs that operators of UNGSFs Texas RRC and EDF said they natural gas leak task force established are subject to regulation under 49 CFR understood the engineering merit under section 31 of the PIPES Act of part 199, ‘‘Drug and Alcohol Testing.’’ behind the RP, but expressed a belief 2016’’ (49 U.S.C. 60141(b)). As

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discussed above, the Interagency Task 1171, which resembled PHMSA’s regulators following the incident at Force issued a final report, titled existing IM program for gas and Aliso Canyon. ‘‘Ensuring Safe and Reliable hazardous liquid pipelines. This section Gas Free Seneca, States First, EDF, Underground Natural Gas Storage,’’ outlines the components of a process, and some private citizens requested that making several recommendations. With including data collection, threat and PHMSA mandate risk-acceptance respect to API RP 1170 and API RP hazard analysis, risk assessment criteria for underground natural gas 1171, the report recommended that methodology, preventative and storage facilities. Gas Free Seneca and ‘‘[t]he incorporation of API RP 1170 and mitigative measures, risk monitoring, private citizens asked that PHMSA set a 1171 into the part 192 regulations will and recordkeeping procedures. measurable limit for risk and specify the be an important step in improving the The IFR did not contain a similar types, frequency, and methods operators safety and reliability of underground gas provision for operators of solution- must use to collect and conduct risk storage facilities.’’ 24 As a result, the mined salt cavern UNGSFs. The term analyses. States First asked that PHMSA report recommended that PHMSA ‘‘Integrity Management’’ is a systematic set an acceptable level of risk so that consider incorporating the standards approach to analyzing and mitigating operators would be required to meet an into part 192 in a manner that would risk to promote the safe management established standard, irrespective of make the standards enforceable.25 After and operations at a given facility. The their self-defined ‘‘capabilities.’’ EDF consideration of the RPs and the IFR required operators of solution- added that the final rule would benefit comments received concerning their mined salt caverns to meet the from the use of a risk-management incorporation, PHMSA concludes that requirements of RP 1170, section 10, ‘‘heuristic’’ such as ‘‘ALARP,’’ an the standards are sufficient to establish ‘‘Cavern Integrity Monitoring,’’ which acronym that stands for ‘‘As Low as an initial, baseline level of regulation directs operators to develop a holistic Reasonably Practicable.’’ According to with the additions incorporated into approach to maintaining well integrity EDF, ALARP provides a process by this final rule. This initial regulatory but does not outline the components of which the regulated industry and the framework will undoubtedly evolve and an integrity-management process as regulator can work together ‘‘to improve over time as PHMSA gains explicitly as section 8 of RP 1171. systematically set appropriate levels of greater experience in this industry. 1. Comments Concerning Integrity risk reduction.’’ 26 F. Integrity Management Practices Management Practices 2. Response to Comments Concerning Integrity management is PHMSA’s As written, the risk-management Integrity Management Practices risk management program for practices in API RP 1170 (for solution- Based on the commenters’ identifying, assessing, and addressing mined salt caverns) lack the specificity suggestions, and supported by an potential threats that can have adverse of the risk-management practices in Interagency Task Force consequences and a finite probability of section 8 of API RP 1171 (for depleted recommendation, PHMSA is making occurring. The regulations in 49 CFR hydrocarbon reservoirs and aquifer several enhancements to the integrity parts 192 (for gas pipelines) and 195 (for reservoirs). Commenters identified the management provisions of the final rule. hazardous liquid pipelines) are a type of lack of robust risk management First, PHMSA is extending the risk integrity management that PHMSA has practices as a safety gap in the integrity management provisions of section 8, to applied to traditional pipeline systems. program for solution-mined salt caverns salt-cavern UNGSFs, to the extent they In place for over ten years, PHMSA’s and requested that the final rule apply to the physical characteristics and integrity management regulations had supplement what is currently prescribed operations of solution-mined salt aided in the removal of thousands of in API RP 1170. caverns, within one year of the effective Several commenters expressed defects from pipeline facilities before date of the final rule. In other words, the concern that the RPs and, consequently, they failed and in the identification of final rule requires that UNGSFs using the IFR, lacked specific risk preventive and mitigative measures to solution-mined salt caverns generally management criteria for solution-mined reduce the likelihood and consequences conform to the risk management salt caverns. As Gas Free Seneca stated, of failures potentially affecting high practices that apply to UNGSFs using RPs 1170 and 1171 mirror each other in consequence areas. PHMSA expects that depleted hydrocarbon and aquifer every respect except for risk applying similar integrity and risk reservoirs. management practices to UNGSFs will management. Gas Free Seneca, EDF, and There are several reasons for this have a similar effect on improving some private citizens requested that the change. As discussed earlier, risk safety. final rule add risk management management is a standard concept in As discussed throughout this final standards for solution-mined salt the oil and gas industry, although rule, API RP 1170 and API RP 1171 caverns like the standards that exist for different programs may use slightly outline the concepts of risk-based depleted hydrocarbon and aquifer different terminology. Additionally, the integrity management and provide reservoirs contained in section 8 of RP Interagency Task Force recommended instructions for the risk assessment and 1171. that PHMSA incorporate risk EDF stated that the IFR called for analysis process for UNGSFs. The IFR management practices into its depleted hydrocarbon and aquifer required operators of depleted regulations. During its initial site reservoir operators to develop risk hydrocarbon reservoirs and aquifer assessments, PHMSA observed that management plans that address risks reservoirs to meet the risk-management operators of solution-mined salt caverns and provide plans to mitigate those requirements outlined in section 8 of RP were already in the process of risks. In its comments, EDF suggested conforming to risk management that such a plan would be a good 24 ‘‘Ensuring Safe and Reliable Underground practices like those detailed in section supplement to the regulations for Natural Gas Storage,’’ Final Report of the 8. RP 1170 does address certain aspects Interagency Task force on Natural Gas Storage solution-mined salt caverns. It stated of risk management practices but is less Safety; October 2016. See pg. 63–64 of the final that adding a risk management plan as report at https://www.energy.gov/downloads/report- ensuring-safe-and-reliable-underground-natural- a requirement in the final rule would be 26 ALARP is a principle more common in gas-storage. consistent with the natural gas storage European law that sets an acceptable level of risk 25 Ibid. rules being considered by California as low as reasonably practicable.

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comprehensive than RP 1171. For Fourth, this final rule requires a • A plan for how to incorporate instance, section 10.2 of RP 1170 slightly different process for UNGSF information gained from experience into requires operators to ‘‘take a holistic and operators to develop a robust IM the IM program on a continuous basis. comprehensive approach to monitor program, depending upon whether the Because these are new, more specific cavern integrity,’’ which would include facility is a depleted hydrocarbon or a requirements than those contained in the identification and assessment of depleted aquifer reservoir or whether it the IFR, operators of existing UNGSFs risks. Section 10.2 of RP 1170 goes on is a solution-mined salt cavern. For the will have an additional year to comply. to say there is no single best method to former, the first step is to put together Sixth, PHMSA establishes a schedule achieve thorough cavern-integrity an initial ‘‘framework’’ based on the for conducting the initial or ‘‘baseline’’ monitoring, thus leaving it up to an provisions of section 8, including: assessments for each reservoir or cavern operator to evaluate the risks of each • A general discussion or definition and all wells. PHMSA has based this specific facility. of risk management; schedule on commenters’ While the scope of RP 1171 is specific • Data collection and integration; recommendations to use a ‘‘phase-in’’ to depleted-hydrocarbon and aquifer • Threat and hazard identification timeline, similar to the UNGSF FAQs reservoirs, much of section 8 is general and analysis; published in April 2017. The final rule enough that operators can readily apply • Risk assessment; requires that operators complete all the practices across all types of • Preventive and mitigative measures; baseline assessments for reservoirs and • UNGSFs. PHMSA believes requiring the Periodic review and reassessment; salt caverns and 40 percent of the risk-management practices outlined in and baseline assessments for individual • section 8 to all UNGSFs is the most Recordkeeping. wells within four years from the practical method of directing all For existing solution-mined salt effective date of this final rule. operators to manage the risks of gas cavern UNGSFs, they must implement a Operators must start with the higher- storage releases on a case-by-case, full IM program within one year from risk wells, as identified through the facility-specific basis. This approach the effective date of the final rule. For operator’s risk-analysis process. The gives operators the flexibility to new facilities constructed after the remaining 60 percent must be determine what actions are appropriate. effective date of the final rule, they must completed within seven years from the Second, § 192.12(d) uses slightly have a full IM program in place before effective date of this final rule. different terminology than what was they commence operations. In addition, Seventh, the final rule requires that used in the IFR to describe the risk the final rule allows solution-mined salt operators conduct periodic management provisions that operators cavern UNGSFs greater flexibility in reassessments under API RP 1171, must follow. Whereas subsection 8.1 is meeting the provisions of section 8 by subsection 8.7, on a risk-based schedule. titled ‘‘Risk Management for Gas Storage requiring that they meet only those This final rule establishes that Operations,’’ § 192.12(d) is titled provisions of section 8 that are reassessment intervals must be no more ‘‘Integrity management program.’’ This applicable to the physical than seven years. PHMSA assumed that change is intended to confirm that the characteristics and operations of a the stress conditions for the downhole risk management program under the solution-mined salt cavern. The two piping used at the well site are similar final rule has been broadened beyond timelines differ because operators of to the stress conditions for buried pipe. what is provided solely under the RPs solution-mined salt cavern facilities did Because of this, PHMSA chose a seven- and that it is a variation of the IM not receive notice of having to meet the year reassessment (maximum) interval programs established under parts 192 IM provisions of section 8 ‘‘that are to be consistent with other gas pipeline and 195 for gas transmission pipelines, applicable to the physical regulations. However, an operator could interstate liquid pipelines, and gas characteristics and operations of a determine its reassessment interval distribution systems. The industry solution-mined salt cavern UNGSF.’’ should be less than seven years based generally uses the term IM to describe PHMSA believes that such a limitation on its risk-based assessments. the risk-management provisions of on the IM program for solution-mined Seventh, the final rule makes clear section 8, so it should be less confusing salt caverns is reasonable and readily that operators may use one or more risk and more consistent to use the term IM ascertainable by operators of such assessments completed before the to refer to all four integrity-management facilities. effective date of the rule to establish a programs applicable to PHMSA- Fifth, in addition to the general baseline assessment, so long as they regulated pipeline facilities,27 even framework outlined in section 8, the meet the requirements of section 8 of RP though the details of each program vary final rule includes several specific IM 1171, and continue to be relevant and slightly. requirements for all UNGSF operators. valid for the current operating Third, as noted in the FAQs, this Each operator’s plan must include the conditions and environment. These initial IM framework for depleted following: requirements are consistent with the • hydrocarbon and depleted aquifer A plan for developing and FAQs published in April 2017.28 This reservoir UNGSFs that were constructed implementing each program element to requirement is intended to prevent prior to July 18, 2017, and were subject meet the requirements of the final rule; operators from reproducing assessments • to section 8 under the IFR, had to be in The roles and responsibilities of that already meet the requirements of place by January 18, 2018. These UNGSF staff tasked with developing this final rule. The criteria and timing operators must now implement a full IM and implementing the IM program; • for reassessments should be determined program that includes the new An outline of the IM procedures to using results from baseline assessments provisions in the final rule within one be developed; • and updated risk analyses in accordance year from the final rule’s effective date. A plan for how staff will be trained with section 8. Operators may also in awareness and application of the conduct new or additional assessments 27 The integrity management provisions for gas operator’s IM program; to supplement prior assessments as transmission pipelines are found at §§ 192.901 • Timelines for implementing each through 192.951, for gas distribution pipelines at §§ 192.1001 through 192.1015, for hazardous liquid IM program element, including the risk 28 https://www.phmsa.dot.gov/pipeline/ pipelines at § 195.452, and for UNGSFs at § 192.12, analysis and baseline risk assessments; underground-natural-gas-storage/ungs-frequently- as amended by this final rule. and asked-questions.

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necessary to establish a thorough evidence that the ALARP model would major new construction, as is currently understanding of a facility’s risks. provide an increase in safety. required for other pipeline facilities. Operators found this reporting Eighth, the final rule requires that G. Notification Criteria Under 49 CFR requirement excessive and operators maintain IM records in the Part 191 for Changes at a Facility same manner as pipeline operators are recommended a monetary or activity required to keep records under other IM The IFR added reporting requirements threshold to reduce the volume of provisions in parts 192 and 195. in 49 CFR part 191. PHMSA requires notifications. These commenters Maintaining IM records is critical if four types of reports from operators of believed that the IFR’s 60-day operators are to properly understand UNGSFs: (1) Annual reports, (2) notification (reporting) requirement for their systems, track and learn from incident reports, (3) safety-related new construction and construction- experience, and to make continuous condition reports, and (4) National related activities was ambiguous and improvements. These records document Registry information. PHMSA required would result in excessive notifications. how and why decisions are made to this information because there was no Some commenters expressed concern identify risks, set priorities among risks, that UNGSF operators follow the same that the provision failed to exempt conduct assessments, and identify and provisions that gas pipeline operators emergencies where advance reporting carry out preventive and mitigative must follow for providing PHMSA with would be impractical. measures. Further, operators must notification of changes at their facilities. LMOGA and TransCanada contended maintain IM records for the life of the Regarding the last type of report, that PHMSA’s notification requirement UNGSF to demonstrate compliance with PHMSA required National Registry would duplicate their reporting burdens all the requirements under § 192.12(d). information to identify the facility and cause delays because operators This level of documentation includes operator responsible for operators already had to notify states of any calculation, amendment, through an Operator Identification construction activities and permitting. modification, justification, deviation Number (OPID). The IFR required LMOGA expressed concern that a 60- and determination made, and any action operators to notify PHMSA no later than day-notice to PHMSA for certain that is taken to implement and evaluate 60 days before certain changes occur, construction activities, such as well including: any element of an IM program. This • workovers, could shut down wells for level of documentation is the same Construction of a new UNGSF an unnecessary amount of time. It stated standard found in § 192.947 for gas facility; that, currently, work permits for well • Abandonment, drilling, or transmission systems and § 195.452(l) workovers are issued by states in one to ‘‘workover’’ of an injection, withdrawal, for hazardous liquid transmission three days. TransCanada contended that monitoring or observation well. systems. PHMSA should remove the 60-day- Concerning well workovers, the IFR notice requirement for new construction Regarding the commenter’s suggestion stated that such work included the from the final rule altogether. It that PHMSA should apply a ‘‘risk- replacement of a wellhead, tubing or suggested that PHMSA could capture tolerance’’ model such as ALARP, casing; and PHMSA believes such a change is • Changes in the entity (including this same information through the unnecessary. Integrity Management (IM) company, municipality, etc.) that is annual report and safety-related is one of many different varieties of risk responsible for an existing UNGSF and condition reports instead of creating a management models used by different the acquisition or divestiture of an separate notification requirement. industries and organizations to handle existing facility. GPTC, PG&E, and others suggested safety risks to people and the PHMSA clarified the IFR’s other ways to streamline or reduce the environment. PHMSA’s IM regulations notification requirements through April notification burden involving new require pipeline operators to identify 2017 FAQs. For example, an operator construction. For example, GPTC the unique risks specific to their should notify PHMSA of a ‘‘replacement suggested that the final rule limit facilities comprehensively and to of a wellhead, tubing or casing.’’ The advance notifications to only those well address those risks through a FAQs said a ‘‘replacement’’ in this workovers where a well was killed, a continuous program of gathering and context meant the ‘‘complete removal of plug placed in the well for work, or a analyzing data and learning from the existing component and rig installed. experience. PHMSA’s approach places replacement with a new component Another suggestion from PG&E was the onus on operators to identify, (including replacement of wellhead, for PHMSA to adopt a monetary prioritize, and handle the risks posed by tubing, or casing).’’ The FAQs further threshold for new-construction pipeline accidents. The IM requirements explained that there was no need for an notifications, provide an exemption for in this final rule are designed to be operator to notify PHMSA of routine emergency work, and define what interpreted and applied essentially the maintenance or repairs to existing activities would constitute a ‘‘well same as the IM regulations currently components. The FAQs went on to say workover.’’ Regarding the monetary applied to gas and hazardous liquid that operators should submit separate threshold, PG&E recommended that pipelines. notifications for each storage field, but PHMSA only require operators to report PHMSA believes that the integrity could bundle multiple activities within well-workover and new-construction program outlined in § 192.12(d) and the the same storage field in a single activities that cost more than $2 million. RPs provides a flexible model that notification. The company noted that PHMSA accounts for the diversity and variability currently limits pipeline notifications 29 of all UNGSFs, so long as the practices 1. Comments on Notification Criteria to those projects involving a certain are risk-based and rigorously applied. Under 49 CFR Part 191 for Changes at minimum mileage or monetary To introduce a new model, such as a Facility threshold; it argued that applying ALARP, just for underground gas The IFR required UNGSF operators to similar thresholds for UNGSFs could storage facilities and not other pipeline notify PHMSA no later than 60 days reduce the reporting burden on facilities, could be confusing for before certain changes took place at operators. operators, PHMSA inspectors, and the their facilities took place, including public. Further, PHMSA is not aware of changes in the operator of a facility and 29 49 CFR 191.22(c)(1)(i).

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2. Response to Comments on amount across all states and activity the new Federal program and receive Notification Criteria Under 49 CFR Part types. During preliminary inspections, Federal funding through PHMSA. 191 for Changes at a Facility PHMSA observed what high-risk The Federal regulatory program for UNGSFs has been set up to mirror the The purpose of the 60-day notification activities were occurring in the field and existing Federal-State pipeline requirement in the IFR is to alert generally how much it costs operators to regulatory partnership for gas and PHMSA of upcoming critical well work complete those maintenance activities. hazardous liquid pipelines as that requires an operator to control well PHMSA is aware that the costs of established by the Natural Gas Pipeline pressure. One example of such a well- pressure-control and remediation Safety Act in 1968 and the Hazardous control activity is well abandonment. If activities vary considerably, depending Liquid Pipeline Safety Act of 1979, an operator incorrectly performs an upon the depth of the well, pressure, casing type and size, and other factors. respectively. Under this system, abandonment, then brine fluid or However, PHMSA believes this is an Congress has conferred on the natural gas may migrate through the appropriate threshold level that Department primary jurisdiction over all wellbore and escape into drinking-water captures the higher-risk activities and natural gas and hazardous liquid aquifers or to the surface. If notified in still reduces the volume and burden of (primarily oil) pipelines in or affecting advance, PHMSA will have the notifications. There is the possibility interstate commerce but has preserved opportunity to review the operator’s that a workover rig is needed for some the states’ role in regulating intrastate pre-work plan and observe the in- minor issues, where the cost falls below pipelines, as long as the State that progress work. Ultimately, this process the 200k threshold. Again, most major chooses to submit an annual is beneficial for the operator and public activities with a workover rig will cost certification to PHMSA and agrees to safety because it ensures a more than $200,000, thus triggering this enforce the minimum Federal standards comprehensive assessment of the type of notification. Note that PHMSA in addition to any State regulations operators’ methods. Such notifications also allows operators to report multiple compatible with the Federal standards. could prevent an incident or more well activities within the same storage The PIPES Act directed PHMSA to costly remediation work. PHMSA will field in a single notification. expand its pipeline-safety regulatory have the opportunity to review an PHMSA also recognizes that the IFR program to include the storage of operator’s records of the project but, inadvertently omitted an exception for natural gas incidental to transportation, because most of the work is emergency maintenance or repairs. If an using this same Federal-State model. underground, reviewing the work in operator reasonably determines that it Just as various states had previously real-time is ideal. needs to do work immediately, for regulated intrastate natural gas pipelines PHMSA agrees with the commenters safety reasons, then it should not delay before the passage of the Natural Gas that it should narrow the scope of the the work because of the 60-day Pipeline Safety Act of 1968, so too have notifications for changes to a facility notification requirement. Accordingly, many states regulated UNGSFs prior to that would eliminate excessive the final rule adds a provision that the passage of the PIPES Act and reporting of minor or routine allows operators to notify PHMSA as issuance of the IFR. These states will be maintenance. Accordingly, this final soon as practicable in instances where able to continue this important safety rule limits required notifications to 60-day notice is not feasible due to an role as partners with PHMSA. PHMSA to only those involving new emergency. In such cases, an operator Under the IFR and this final rule, construction and major maintenance must promptly respond to the intrastate UNGSF facilities will be work. Specifically, the final rule emergency, notify PHMSA as soon as regulated in one of two ways. provides that operators must notify practicable, and document the Depending upon State law, they will be PHMSA of (1) any new facility emergency and the reason for any delay regulated either by a certified State construction; (2) maintenance work that in notification. entity (e.g., public utility commission or requires a workover rig and costs oil and gas commission), or, in the $200,000 or more for labor, materials, H. The States’ Role in Regulating absence of a certified State partner, by and services; and (3) any plugging or UNGSFs PHMSA. Notably, section 12 of the abandonment activities, regardless of There are approximately 403 active PIPES Act expressly allows a State cost. underground natural gas storage authority to adopt additional or more The scope of this modified facilities (UNGSFs) in the United States, stringent safety standards for intrastate notification requirement is limited to with about a 60/40 split between UNGSFs, provided such standards are only those types of activities that interstate and intrastate facilities. compatible with the minimum Federal require adherence to specific methods Interstate UNGSFs serve interstate requirements. PHMSA interprets this to and techniques to prevent damage to the facilities, and PHMSA has exclusive mean that any State authority that has formations and to safely control pipeline safety jurisdiction over the filed an annual State certification with pressure in the well. Bringing in a design, construction, operation, and PHMSA under 49 U.S.C. 60105 to workover rig marks a step-change in the maintenance of these facilities. regulate UNGSFs may regulate and degree of complexity and scope of work. Intrastate UNGSFs, on the other hand, enforce its own additional or more The presence of a workover rig means are facilities that provide gas storage for stringent regulations against intrastate the operator is opening the well, rather intrastate pipelines, most notably local UNGSFs that fall under that authority’s than just doing some wing valve work gas distribution companies (LDCs). State jurisdiction, to the extent that the at the surface. Opening a well (requiring Generally, these intrastate gas pipeline additional State standards are a workover rig) usually infers serious facilities have been subject to State compatible with the Federal safety maintenance or repair work, performing regulation by its public utility regulations. This arrangement is the extensive logging and integrity commission or oil and gas commission. same as the States’ authority to regulate evaluations, or replacement of Intrastate UNGSFs continue to be all other intrastate pipeline facilities downhole components. subject to State regulation, but only if under parts 192 and 195. Concerning the $200,000 the applicable State authority has filed Accordingly, States that had UNGSF maintenance-work threshold, PHMSA a certification with PHMSA to regulations before the adoption of the has not indexed this exact dollar participate as a full State partner under IFR may continue to implement any

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additional or more stringent regulations undermine or reduce the existing level UNGSFs as it continues to develop that they currently enforce with respect of safety and environmental protection Federal regulations. to intrastate facilities, to the extent that that several States have been applying to such regulations are compatible with interstate UNGSFs, especially where 2. Response to Comments on the State the minimum standards set by this final certain State standards could arguably Permitting of UNGSFs rule. For a State wanting to expand its be viewed as broader or more stringent As for the comments seeking greater authority to inspect interstate facilities than the RPs being adopted in the final clarity on how the IFR affects State under the final rule, it will be able to rule. These comments are discussed permitting of UNGSFs, PHMSA has not apply to PHMSA for discretionary below in more detail. interstate agent status under 49 U.S.C. made any changes to the regulatory text 60106(b), just as a State authority today, 1. Comments on State Permitting of because PHMSA does not have the may carry out such a role for other oil UNGSFs authority to prescribe the location or siting of UNGSFs. This final rule also and gas pipeline facilities. In its comments, the Texas RRC asked It is worth noting that neither the PHMSA to clarify the States’ role in does not deal with permitting, directly. PIPES Act nor this final rule alters the permitting UNGSFs and commented Section 12 of the PIPES Act expressly existing role of the States in the siting that the IFR provided no specific details states that the Act shall not be construed or permitting of UNGSFs or their regarding permitting areas that fall to to authorize PHMSA ‘‘to prescribe the regulation of natural gas production. the states.31 The commission noted that location of an underground natural gas PHMSA has never exercised regulatory while the IFR accurately stated that storage facility’’ or ‘‘to require the control over these issues for pipeline permitting of gas wells is not a PHMSA Secretary’s permission to construct’’ a and will not be doing so under the final function, PHMSA had incorrectly UNGSF. rule. Instead, the PIPES Act provides concluded: ‘‘that the traditional role of 3. Comments on State Regulation of that all UNGSFs incidental to gas permitting intrastate facilities falls to UNGSFs Associated With Gas ‘‘transportation’’ are now subject to the states and the permitting of Production Federal minimum safety standards interstate facilities falls to the Federal promulgated by PHMSA. Section 12 of Energy Regulatory Commission IPAA, EDF, and Hilcorp requested the PIPES Act directs PHMSA to (FERC).’’ According to the Texas RRC, exercise this authority in conjunction that PHMSA clarify how the IFR applied ‘‘FERC is not set up to conduct to UNGSFs associated with gas- with its State partners in the same permitting of individual wells, ensuring manner as other pipeline facilities are production facilities. IPAA stated that proper notification is provided to all regulated. the Pipeline Safety Laws do not provide entitled parties, reviewing and This means FERC and the States will PHMSA with authority to regulate gas- adequately protecting groundwater, and continue to exercise their respective production facilities, citing 49 U.S.C. protecting correlative rights.’’ authorities over the permitting of 60101(a)(21)(A) and 60101(a)(22)(B). Conversely, the Texas RRC explained UNGSFs. FERC reviews applications for IPAA, EDF, and Hilcorp requested that the construction and operation of that under Texas law, the Texas RRC is directed to regulate the downhole PHMSA add an exception to part 192, UNGSFs owned by interstate gas specifically excluding UNGSFs that are pipeline operators and that are portion of UNGSFs to fulfill its mandate to conserve State natural resources and ‘‘in direct support of’’ (Hilcorp) or that integrated into their pipeline systems. In are ‘‘co-located with and used to its application review, FERC requires an to protect the environment. Therefore, it argued, ‘‘all of these functions must fall support of’’ (IPAA) production applicant to certify that it will comply operations. with DOT safety standards. While FERC to the State regardless of whether a well has no jurisdiction over pipeline safety, is part of an intrastate or interstate IPAA gave two examples of the types PHMSA and FERC actively collaborate facility.’’ Finally, the Texas RRC argued of production-related UNGSFs located to exercise their respective that the failure of PHMSA to properly in active production fields that are used responsibilities.30 address these scenarios ‘‘indicates a lack to manage production operations, rather PHMSA received several comments of a clear understanding of underground than providing ‘‘commercial storage regarding the effect of the IFR on the natural gas storage and the historical services.’’ The first type was facilities role of the states in UNGSF regulation. role many states have had in its that store gas from a production field These comments dealt primarily with successful regulation of underground but has not yet entered a PHMSA- concerns expressed by State regulators hydrocarbon storage.’’ regulated pipeline. The second type was and gas-storage operators over PHMSA’s Similarly, Dow Chemical asserted that UNGSFs that are used for gas role and the nature of the Federal-State many states had established successful production purposes ‘‘after being partnership under this new regulatory regulations and standards for delivered to the production field in a scheme. These commenters also asked permitting, operations, maintenance, PHMSA-regulated pipeline.’’ In other PHMSA to explain the roles of the monitoring, and other issues related to words, they store gas that has either not UNGSFs. The company pointed out that various parties in permitting UNGSFs, yet entered transportation or that has states with underground-storage safety to discuss the potential conflicts that ended transportation. Under both may arise between existing State regulations typically regulate both intrastate and interstate facilities. Along scenarios, IPAA contended, the stored regulations affecting underground gas at these facilities is not incidental to storage and the new Federal minimum with Dow Chemical, LMOGA, MDEQ, transportation but is used to support gas safety standards and the degree to and the Texas RRC recommended that production. According to these industry which certain existing State regulations PHMSA consult with State regulatory will continue to apply to interstate agencies to avoid unnecessary reporting commenters, such UNGSFs are used in UNGSFs. Of particular concern was and compliance programs and to learn the process of extracting natural gas whether the IFR could serve to from the states’ experience in regulating from the ground and should not be treated as providing storage incidental 30 Page 28. https://www.ferc.gov/market- 31 See State of Texas v. PHMSA, No. 17–60189 to transportation under the Pipeline oversight/guide/energy-primer.pdf. (5th Cir. Mar. 17, 2017). Safety Laws.

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4. Response to Comments on UNGSFs by the RPs and that ‘‘Michigan’s existing extending minimum Federal safety Associated With Gas Production regulations are needed to fill gaps in the standards to all interstate gas storage The PIPES Act directed PHMSA to IFR particularly in the areas of facilities, regardless of whether establish minimum Federal standards permitting, liquid waste handling and individual states have already adopted for all UNGSFs that store natural gas disposal; and environmental protection regulations governing storage facilities incidental to transportation. Again, the from liquid hydrocarbons, brines, and or whether individual interstate PIPES Act does not alter or expand other liquid contaminants.’’ The agency operators have voluntarily complied PHMSA’s jurisdiction as it has further commented that the IFR ‘‘makes with existing State regulations. As no mention of pollution prevention, nor PHMSA discussed in the IFR, interstate traditionally been applied to natural gas does it set standards for remediation of UNGSF facilities would not be subject production or hazardous liquid spills.’’ It noted that many UNGSFs are to any regulatory safety requirements in production facilities. While PHMSA has located in oil reservoirs that still the absence of this Federal action. never exerted jurisdiction over gas produce liquid hydrocarbons and brine, Fourth, PHMSA fully recognizes that pipeline facilities that are engaged and that the State of Michigan has states with UNGSFs typically have exclusively in production and has long comprehensive regulations covering various regulations in place governing recognized the authority of states to pollution prevention, groundwater the construction, remediation, and regulate the permitting and siting of monitoring, remediation, and clean-up plugging of gas wells. Before the IFR pipelines and to protect groundwater activities. In short, the State urged went into effect, many interstate UNGSF and other State natural resources. Only PHMSA to ‘‘recognize the states’ role in operators relied on these State after transportation has begun and these areas.’’ regulations to help develop best before delivery to an end-user is there practices. State safety jurisdiction, any issue of PHMSA jurisdiction, which 6. Response to Comments on the States’ however, extends only to intrastate is limited to the transportation of gas Regulation of Intrastate UNGSFs UNGSFs. Regulations differ from State and hazardous liquids. First, PHMSA recognizes and to State, making it difficult for operators This is analogous to PHMSA’s supports the role that many states have to maintain consistent performance regulation of other types of temporary played for many years in the field of across all their interstate facilities. storage of hazardous liquid in transit. underground gas storage. Nothing in the Finally, PHMSA will incorporate For example, petroleum being IFR or this final rule is intended to lessons learned from operators and transported by pipeline is often stored minimize or diminish the states’ role in states implementing this final rule in temporarily along the line in one or ensuring the safety of UNGSFs, the form of guidance and additional more breakout tanks. These tanks are protecting the environment, or rulemakings. PHMSA understands that used to relieve surges or receive and safeguarding critical State resources. seeking input from states is a vital store hazardous liquid transported by Section 12 of the PIPES Act, however, component in developing an effective pipeline for eventual re-injection and mandates that PHMSA regulate all underground natural gas storage continued transportation by pipeline (49 UNGSFs that storing natural gas program at the Federal level. CFR 195.2). Similarly, under this final incidental to transportation. Under 49 As for the comments regarding rule, a UNGSF is defined as a gas U.S.C. 60104(c) and the recently- potential conflicts between existing pipeline facility ‘‘that stores natural gas enacted 49 U.S.C. 60141(e), states with State regulation of intrastate UNGSFs, underground and incidental to the existing regulations may continue to three points should be made. First, transportation of natural gas’’ in regulate intrastate gas storage facilities many State agencies enjoy independent interstate or foreign commerce. to the extent that the proper State authority under their own particular PHMSA interprets this to mean that if authority becomes certified by PHMSA State’s laws to regulate UNGSF a UNGSF is used in any way to store gas and the State regulations are compatible involving public health, protection of that is received from a PHMSA- with the new Federal minimum safety groundwater, allocation of mineral regulated pipeline and returns any of standards. rights, and similar areas not involving that stored gas to transportation by Second, the PIPES Act and this final safety. Under established Federal pipeline, then such a facility is rule do not modify or undermine preemption law, States may regulate in incidental to transportation and established principles of Federal such areas that are not preempted therefore covered by this final rule. preemption law as applied to pipeline expressly by Federal law or regulation. Even if some of that gas is used to safety. Any State regulation affecting In the field of underground natural support production operations or is PHMSA’s exclusive jurisdiction over the gas storage, Congress, through the PIPES mingled with produced gas that has not safety of interstate pipeline Act, has conferred authority on the yet entered transportation, the storage transportation facilities is, and always Secretary (and delegated to PHMSA) to facility itself will be treated as a UNGSF has been, preempted by the Pipeline provide for the safety of natural gas under the final rule and will be subject Safety Laws.32 The enforceability of storage facilities incidental to to PHMSA’s full jurisdiction. existing or new State regulations transportation, just as it has for other oil affecting gas production, storage, and gas pipeline facilities. This 5. Comments on States’ Regulation of authority covers the design, Intrastate UNGSFs plugging, or other areas such as mineral rights, depends on whether the State construction, operation, and Several commenters expressed regulations are based on an independent maintenance of UNGSF facilities. States concern that the IFR potentially basis under State law and cannot be are precluded from regulating the safety conflicted with existing State regulation considered safety regulations preempted of UNGSFs to the extent that such State of intrastate UNGSFs and that the IFR by the PIPES Act, which is necessarily regulations conflict with PHMSA’s lacked clarity on how such conflicts a case-by-case determination. safety-related regulations. To determine could be avoided or minimized. MDEQ, Third, the PIPES Act and this rule whether specific State regulations are for instance, commented that its Oil, represent a major step forward in preempted by the PIPES Act and this Gas and Minerals Division ran a final rule may require a fact-specific regulatory program affecting many 32 See, e.g., Colorado Interstate Gas Company v. analysis of whether a particular State safety and environmental issues covered Wright, 707 F. Supp. 2d 1169 (D. Kan. 2010). regulation has been preempted, an

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analysis that falls within the purview of that optimized existing State ‘‘voluntarily’’ obeying State rules. State and Federal courts. Such regulations. EDF commented that the PHMSA acknowledges EDF’s concern preemption determinations have new Federal regulations would create a that some interstate operators may routinely been made by the courts to ‘‘ceiling’’ on State regulations for the choose to no longer voluntarily comply resolve challenges to State and local permitting, drilling, completion, and with State UNGSF regulations that go governments’ authority to regulate gas operation of underground storage wells beyond the new minimum Federal and hazardous liquid pipelines. that have also been applied to interstate standards embodied in the final rule. Second, any potential conflict facilities. EDF acknowledged that while However, the Federal standards do not between existing State regulations interstate facilities are under the disincentivize the voluntary compliance governing intrastate UNGSFs and exclusive safety jurisdiction of PHMSA, that was previously occurring before the Federal safety regulations disappears, in intrastate UNGSFs are frequently subject IFR went into effect, provided that the most cases, in those states that have to both safety regulations promulgated voluntary compliance is compatible submitted annual certifications to by PHMSA and to other gas-storage with the Federal standards. Therefore, it PHMSA and become UNGSF State rules promulgated by State regulators seems unlikely that an interstate partners. All State partners in this that generally apply to all gas wells in operator who is already voluntarily program will have the authority to adopt their particular states. EDF expressed complying with existing State safety- and enforce additional or more stringent the fear that interstate UNGSF operators related standards would stop doing so safety regulations than the minimum who had been ‘‘voluntarily obeying because of this final rule unless Federal standards set forth in the IFR. State rules responding to the State’s voluntary compliance were to result in PHMSA anticipates and hopes that unique geology, level of subsurface non-compliance with the Federal many states, such as Texas, Michigan, activity, competing surface activities standard. Further, this is the same and other commenters that already have and general appetite for risk may, with situation that exists with other State existing regulations affecting intrastate the cover of PHMSA’s IFR, decline to regulations that may affect gas and UNGSF safety, will decide to partner continue following those rules, possibly hazardous liquid pipelines and with with PHMSA and enjoy the enhanced to the detriment of safety and the which interstate operators may or may authority, Federal funding, and other environment.’’ not choose to comply. For these reasons, benefits that accompany State To address this concern, EDF asked PHMSA declines to modify the final certification. PHMSA to include two specific rule to require interstate operators to Third, PHMSA encourages and provisions in the final rule. First, it take such State regulations into account supports State regulatory programs that asked PHMSA to distinguish between in their IM plans or other procedures. help ensure all UNGSFs, both intrastate those State regulations of general The agency believes it would be and interstate, address resource applicability to all oil and gas wells (i.e., inconsistent and impracticable to conservation, environmental protection, those falling within the jurisdiction require operators to evaluate and land use, emergency response, and other ceded to states under the Natural Gas include in their plans and procedures important issues affecting gas wells and Act of 1938) and those addressing the certain provisions of State regulations storage outside the realm of safety. special risks intrinsic to gas storage for UNGSFs but not for other pipeline PHMSA agrees with MDEQ’s wells. EDF requested that PHMSA direct facilities. This would put PHMSA in the comments and encourages MDEQ to interstate operators to adhere to State untenable position of elevating certain examine its existing State UNGSF regulations for permitting, drilling, State regulations for all interstate regulations to determine whether any of completion and operation of storage UNGSF operators but not for other State them are safety-related standards that wells, but ‘‘only to the extent the pipeline regulations. If PHMSA learns of could be preempted by this final rule in regulations address risks of general State regulations that should be applied the event Michigan decides that it does applicability to all oil and gas wells and more broadly for all interstate UNGSF not wish to become a certified State where it is not impossible to comply operators, it may consider amending its partner for intrastate UNGSFs. If with both the State regulations and regulations through notice-and- Michigan does become a State partner PHMSA requirements.’’ comment rulemaking to make them for UNGSFs, then MDEQ (or other State Second, EDF asked PHMSA to require applicable uniformly among all authority in Michigan) will be able to interstate operators in states having interstate operators. apply additional or more stringent adopted ‘‘storage’’ regulations to safety standards, provided they are identify all State rules that an operator I. Definitions and Terminology ‘‘compatible’’ with the minimum believes are ‘‘storage’’ rules and address The IFR added a definition for Federal standards prescribed under the those rules in their risk management ‘‘underground natural gas storage Pipeline Safety Laws and this final rule. plans as part of the operators’ facility’’ at 49 CFR 191.3 based on the If it chooses not to become a State preventive and mitigative measures to definition provided in section 12 of the partner for UNGSFs, then the Federal address ‘‘special risks intrinsic to gas PIPES Act. The IFR’s definition minimum safety standards will apply to storage.’’ According to EDF, this would included the wellhead, downhole all intrastate UNGSFs in Michigan, and serve to preserve the efforts made by components, and associated onsite PHMSA will inspect such facilities and some states to ensure safety and structures that lay within the scope of enforce the Federal minimum standards environmental protections imposed in PHMSA’s regulatory authority. The IFR against all intrastate UNGSFs in the the face of no minimum Federal provided no additional definitions. State. standards. 1. Comments Regarding Definitions and 7. Comments on States’ Regulation of 8. Response to Comments on the States’ Terminology Interstate UNGSFs Regulation of Interstate UNGSFs Several commenters asked that Some commenters, including EDF and As noted earlier, EDF and other PHMSA modify the definition of the Interstate Oil and Gas Compact commenters have pointed out that a ‘‘underground natural gas storage Commission, expressed concern that the number of interstate UNGSF operators facility’’ in the final rule and to clarify IFR did not go far enough in exercising in states with mature regulatory or define other terms not defined in the jurisdiction over UNGSFs in a manner programs in place have been IFR. Two commenters requested that

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PHMSA create separate definitions for equipment was already covered under of such terminology under the modified interstate and intrastate facilities. They other provisions of part 191. regulatory text in the final rule. said that clarification in the final rule Northern Natural Gas, stated that the would prevent jurisdictional confusion definition of a ‘‘modified well’’ was not J. Requests for Additional or More at the State level and enable their clear and could be interpreted to Stringent Requirements include some minor or routine organizations to apply the rules more PHMSA received several comments operations, such as the replacement of predictably. from private citizens related to Operators recommended a revised downhole equipment, casing repairs, or additional or more stringent definition of ‘‘underground natural gas tubing changes. storage facility,’’ while others asked that requirements for UNGSFs that do not fit 2. PHMSA’s Response to Comments into the other categories already PHMSA clarify the terms ‘‘workover’’ Regarding Definitions and Terminology and ‘‘modified well.’’ discussed. Gas Free Seneca, EDF, and The Associations recommended that PHMSA agrees with the commenters’ several private citizens asked PHMSA to PHMSA revise the definition of suggestion to revise the definition of require the widespread use of ‘‘underground natural gas storage ‘‘underground natural gas storage subsurface safety valves. Some called facility’’ to avoid confusion with other facility,’’ and, therefore, is amending it for a plan to decommission UNGSFs. subparts of 49 CFR part 192. They were in this final rule. The revised definition Others called for a moratorium on new concerned that the definition in the IFR will better articulate the point of facilities. included ‘‘piping, rights-of-way, demarcation between facilities that constitute the UNGSFs and those that The widespread use of subsurface property, buildings, compressor units, safety valves may have value but would separators, metering equipment, and are part of other gas pipeline facilities. Traditionally, compressor units, require further study and research as to regulator equipment,’’ terminology that their effective use at each type of could imply components of a UNGSF buildings, and separators have been UNGSF over other safety enhancements were covered by both the underground considered part of the ‘‘topside’’ pipe or alternatives. In PHMSA’s ongoing natural gas storage regulations at domain and are already regulated by discussions with operators, the failure § 192.12 and other provisions in part other sections of part 192. These 192. They recommended that the components can be connected to or from rates of subsurface safety valves during definition of ‘‘underground natural gas UNGSFs. PHMSA considers a UNGSF to testing are variable. Additionally, once storage facility’’ be amended to exclude include all components up to the valve installed, an operator would have to re- ‘‘facilities covered by part 192 of this assembly (and their flanges) that route open the well to make any repairs to the chapter.’’ gas at the wellhead to or from the subsurface safety valve, requiring a The Associations further noted that connected pipeline(s). The valve workover rig to retrieve the valve. Given the definition of a UNGSF included the assembly may be a single manual or these factors, PHMSA would require term ‘‘solution-mined salt cavern automated valve or a combination of additional certainty and a strong safety reservoir.’’ They stated that the term valves (e.g., manual and emergency case before promulgating a Federal ‘‘reservoir’’ is inaccurate in reference to shutdown) and will be located near the requirement for the widespread use of salt caverns and recommended that wellhead. subsurface safety valves. With respect to the need for separate PHMSA use the term ‘‘a solution-mined As for a moratorium, PHMSA does salt cavern’’ for technical accuracy. definitions for intrastate and interstate UNGSFs, PHMSA sees no need for such not have the authority to site UNGSF Similarly, the GPTC recommended that definitions. The use of the phrase facilities (and, by extension, to ban new the final rule revise the definition of ‘‘incidental to natural gas facilities) or to abrogate the power of UNGSF to align with the scope of the transportation’’ in 49 CFR 192.3 makes states to issue permits. Therefore, a RPs 1170 and 1171. Similarly, PG&E recommended that clear that the scope of PHMSA’s moratorium would be outside the scope PHMSA replace the definition of jurisdiction over UNGSFs does not of PHMSA’s authority and contrary to ‘‘underground natural gas storage depend upon whether a facility is the PIPES Act. ‘‘interstate’’ or ‘‘intrastate’’ but whether facility’’ at § 192.3 with the following: PHMSA recognizes that there are it is tied to ‘‘transporting gas,’’ as that inherent risks to operating a UNGSF; ‘‘Underground gas storage facility means a term is defined under 49 U.S.C. facility that stores natural gas in an however, Federal and State regulations 60101(a)(21). This means that UNGSFs underground facility incidental to natural gas may include gas storage facilities that minimize these risks by requiring transportation, which is constructed from a operators to adhere to clear performance depleted hydrocarbon reservoir, an aquifer can be used occasionally or partially for reservoir, or a solution-mined salt cavern. In production operations, such as standards designed to maintain the addition to the reservoir, this also includes enhanced recovery, gas lift, and for integrity of the wellhead and reservoir the injection, withdrawal, monitoring, production equipment such as power or cavern. Furthermore, the addition of observation wells, and associated wellhead generation and powering compressors requirements in this final rule related to equipment within the facility.’’ and pumps. IM and recordkeeping will add greater PG&E also recommended that PHSMA Other commenters requested that rigor to the risk-management practices remove the phrase ‘‘including injection, PHMSA clarify common terms used than in the IFR. In summary, the IFR withdrawal, monitoring, or observation throughout RPs 1170 and 1171, such as and this final rule constitute the first well for an underground natural gas ‘‘wellhead,’’ ‘‘workover,’’ or ‘‘modified large-scale application of PHMSA’s storage facility’’ from the criteria for well.’’ For similar reasons, the final rule regulation jurisdiction to UNGSFs. As submitting a safety-related condition does not provide definitions for operators begin applying the RPs and report under § 191.23. The company technical terms generally known to assessing the integrity of their facilities stated that because such equipment was industry, such as ‘‘wellhead,’’ and as PHMSA gains experience in already included in the definition of ‘‘modified well,’’ and ‘‘workover.’’ regulating UNGSFs, the need for any ‘‘underground natural storage facility,’’ PHMSA will work with operators on a additional prescriptive measures will operators might incorrectly conclude case-by-case basis should the need arise become apparent. that two reports were required since the to determine the appropriate application

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IV. Rulemaking Analyses and Notices annualized cost savings as a result of Accordingly, PHMSA is not required to these changes is $8,452,365 to provide a written statement in A. Statutory/Legal Authority for This $12,810,620 when discounted to present accordance with the UMRA. Rulemaking value at 7 percent. This final rule is published under the F. National Environmental Policy Act authority of the Federal Pipeline Safety C. Executive Order 13771 PHMSA has analyzed this final rule in Law (49 U.S.C. 60101 et seq.), as This final rule is considered an E.O. accordance with section 102(2)(c) of the amended by the PIPES Act (Pub. L. 114– 13771 deregulatory action. Details on National Environmental Policy Act (42 183, June 22, 2016). Section 60102 the estimated cost savings of this U.S.C. 4332), the Council on authorizes the Secretary of proposed rule can be found in the rule’s Environmental Quality regulations (40 Transportation to issue regulations economic analysis. CFR 1500–1508), and DOT Order governing the design, installation, 5610.1C. PHMSA has published the D. Regulatory Flexibility Act inspection, emergency plans and results of this analysis in an procedures, testing, construction, The Regulatory Flexibility Act (RFA) Environmental Assessment (EA) as extension, operation, replacement, and of 1980, as amended by the Small required by 40 CFR part 1502. maintenance of pipeline facilities. The Business Regulatory Enforcement Based on the EA, PHMSA has Secretary has delegated her authority in Fairness Act (SBREFA) of 1996, requires determined this final rule would not this area to the Administrator of Federal agencies to consider the impact significantly affect the quality of the PHMSA (49 CFR 1.97). PHMSA is of their rules on small entities, analyze human environment. To assess the issuing the amendments to the alternatives that minimize those impact of these regulations on the requirements for UNGSF involved in impacts, and make their analyses human environment, PHMSA pipeline transportation under this available for public comments. The Act considered three alternative scenarios, authority. is concerned with three types of small including adopting the IFR without entities: Small businesses, small amendments, the API RPs as written, B. Executive Order 12866 and DOT nonprofits, and small government and the provisions in this final rule. Regulatory Policies and Procedures jurisdictions. PHMSA concludes that this action will This final rule is a significant action The RFA describes the regulatory not significantly affect the quality of the under section 3(f) of E.O. 12866. flexibility analyses and procedures that human environment. Therefore, the Office of Management Federal agencies must complete unless To the extent that the measures taken and Budget (OMB) has reviewed it. they certify that the rule, if to comply with the IFR did not involve PHMSA prepared a regulatory impact promulgated, would not have a additional environmental impacts and analysis (RIA) for the final rule, which significant economic impact on a instead served to reduce the risk of details the potential for incremental substantial number of small entities. A natural gas incidents, PHMSA expects benefits and costs. The RIA, which is statement of factual basis must support this final rule to continue these positive available in the docket for this final this certification, e.g., by addressing the environmental impacts. The information rule, Docket No. PHMSA–2016–0016, number of small entities affected by the in this Environmental Assessment provides an estimate of the annualized proposed action, calculating expected report supports a Finding of No cost savings of the final rule and the cost impacts on these entities, and Significant Impact (FONSI) for this final other alternatives considered relative to evaluating economic impacts. rule. the baseline. Given the final rule does PHMSA estimated that this final rule not impose any costs relative to the would affect 130 operators. Of these 130 G. Executive Order 13132 baseline (IFR), PHMSA determined that operators, there are 14 small entities. E.O. 13132 (‘‘Federalism’’) (64 FR the final rule is not economically However, this final rule is a 43255, Aug. 10, 1999) requires PHMSA significant under Executive Order 12866 deregulatory action that will reduce the to develop an accountable process to because the estimated annual impact is burden of information collections. ensure ‘‘meaningful and timely input by less than $100 million. Therefore, PHMSA has determined that State and local officials in the Under the final rule, PHMSA expects this final rule will not have a significant development of regulatory policies that operators to continue performing the economic impact on any small entities. have federalism implications.’’ E.O. same preventative safety measures that 13132 defines policies that have E. Unfunded Mandates Reform Act of they are performing under the IFR. federalism implications to include 1995 Because PHMSA does not expect the regulations that have ‘‘substantial direct final rule to change operator safety- Title II of the Unfunded Mandates effects on the states, on the relationship related actions, PHMSA does not expect Reform Act (UMRA) of 1995, Public between the national government and changes to the benefits relative to the Law 104–4, requires that Federal the states, or the distribution of power IFR. Implementation of the IFR already agencies assess the effects of their and responsibilities among the various achieved benefits that will remain in regulatory actions on State, local, and levels of government.’’ place, including the potential Tribal governments and the private Section 6 of E.O. 13132 limits prevention of catastrophic natural gas sector. Under Section 202 of UMRA, regulations that impose substantial releases due to the failure of storage PHMSA must prepare a written direct compliance costs on a State wells and the associated impacts on statement, including a cost-benefit unless the Federal government provides human health, property, and the analysis, for proposed and final rules the funds necessary to pay the direct environment, including climate change. with ‘‘Federal mandates’’ that might compliance costs incurred by State and PHMSA does anticipate cost savings result in expenditures by State, local, local governments. PHMSA also may once the final rule becomes effective. and Tribal governments, in the not issue regulations that preempt State Using the IFR as a baseline, the final aggregate, or by the private sector, of law unless the agency consults with rule will reduce recordkeeping and $100 million (adjusted annually for State and local officials early in the reporting burdens, and burdens inflation) or more in any one year (i.e., process of developing the regulation. associated with technical evaluations of $153 million in 2016 dollars). This final PHMSA has concluded that this non-mandatory RPs. The estimated rule will not result in such expenditure. action will not have federalism

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implications because it does not impose requires Agencies to prepare a During the rulemaking process, PHMSA any direct compliance costs on State or Statement of Energy Effects when must also obtain approval from the local governments. This final rule undertaking certain actions. Such Office of the Federal Register to reduces the burden from information Statements of Energy Effects shall incorporate by reference any new collection and therefore does not describe the effects of certain regulatory materials. impose any direct compliance costs. actions on energy supply, distribution, PHMSA worked to make the materials With respect to preemption, E.O. or use, notably: (i) Any adverse effects incorporated by reference reasonably 13132 requires agencies to determine if on energy supply, distribution, or use available to interested parties. PHMSA their regulatory actions would preempt (including a shortfall in supply, price is prohibited from issuing a regulation State law or impose a substantial direct increases, and increased use of foreign that incorporates by reference any cost in compliance on them. Congress supplies) should the proposal be document unless that document is explicitly addressed the preemption of implemented, and (ii) reasonable available to the public, free of charge State underground storage regulations in alternatives to the action with adverse (Pub. L. 113–30, Aug. 9, 2013). the PIPES Act in section 60141(e). A energy effects and the expected effects To meet these requirements, PHMSA State authority may adopt additional or of such alternatives on energy supply, negotiated agreements with all but one more stringent safety standards for distribution, and use. of the respective standards developing intrastate underground natural gas In a memorandum on E.O. 13211, organizations (SDO) with standards storage facilities as long as they are OMB outlines the criteria for assessing already incorporated by reference in the compatible with Federal requirements. whether a regulation constitutes a PSRs to make viewable copies of those This statement is consistent with the ‘‘significant energy action’’ and would standards available to the public at no existing statute governing PHMSA’s have a ‘‘significant adverse effect on the cost. PHMSA has an agreement in place preemption of State regulation over supply, distribution or use of energy.’’ 33 with API, who voluntarily made the RP intrastate pipeline transportation Of the potentially adverse effects on the 1171 and RP 1170 available on API’s facilities at 49 U.S.C. 60104(c). supply, distribution, relevant to this public website. API’s mailing address As noted in the IFR and the final rule, only one of the criteria is and the website are listed in 49 CFR part discussion above, interstate facilities applicable to this final rule: The ability 192. would not be subject to any regulatory of interstate operators to pass costs on K. Paperwork Reduction Act safety requirements with respect to their to consumers. However, because this wellhead and downhole facilities in the final rule results in cost savings, it The Paperwork Reduction Act of absence of Federal action. Even before would not increase the cost of energy 1995 34 (PRA), Public Law 104–13, is the issuance of the IFR, the Federal distribution. implemented by OMB and requires that Pipeline Safety Laws preempted any agencies submit a supporting statement State regulation purporting to affect J. National Technology Transfer and to OMB for any information collection interstate pipeline transportation Advancement Act of 1995 that solicits the same data from more facilities. States with existing The National Technology Transfer than nine parties. The PRA seeks to underground natural gas storage and Advancement Act of 1995, 15 ensure that Federal agencies balance regulations may continue to implement U.S.C. 272, directs Federal agencies to their need to collect information with those additional, and possibly more use voluntary consensus standards the paperwork burden imposed on the stringent, regulations on intrastate gas instead of government-written standards public by the collection. storage facilities to the extent that the when appropriate. The OMB Circular The definition of ‘‘information State regulations are compatible with A–119, ‘‘Federal Participation in the collection’’ includes activities required the new Federal regulations outlined in Development and Use of Voluntary by regulations, such as for permit this final rule. Interstate underground Consensus Standards and in Conformity development, monitoring, storage facilities are now subject to the Assessment Activities,’’ sets the policy recordkeeping, and reporting. The term new Federal regulations, whereas for Federal use and development of ‘‘burden’’ refers to the ‘‘time, effort, or previously, those facilities were not voluntary consensus standards. As financial resources’’ the public expends subject to any regulatory safety defined in OMB Circular A–119, to provide information to or for a requirements. voluntary consensus standards are Federal agency or to fulfill statutory or H. Executive Order 13175 technical standards developed or regulatory requirements otherwise. The adopted by domestic and international PRA paperwork burden is measured in E.O. 13175 (‘‘Consultation and organizations. These organizations use terms of annual time and financial Coordination with Indian Tribal agreed-upon procedures to update and resources the public devotes to meet Governments’’) reaffirms the Federal revise their published standards every one-time and recurring information Government’s commitment to the Tribal three to five years to reflect modern requests.35 Information collection sovereignty, self-determination, and technology and best technical practices. activities may include: self-government. To that end, the Accordingly, PHMSA has the • Reviewing instructions; agencies must consult with Tribal • responsibility for determining, via Using technology to collect, governments as they develop policy on petitions or otherwise, which standards process, and disclose information; issues that may affect those • it should add, update, revise, or remove Adjusting existing practices to communities. This final rule imposes no from 49 CFR subchapter D. PHMSA comply with requirements; substantial direct compliance costs or • handles these changes to incorporate by Searching data sources; burdens on Tribal governments. So, the • reference materials via the rulemaking Completing and reviewing the requirements of E.O. 13175 do not process, which allows the public and response; and apply. • regulated entities to provide input. Transmitting or disclosing I. Executive Order 13211 information. 33 E.O. 13211 was issued May 18, 2002. The E.O. 13211 (‘‘Actions Concerning Office of Management and Budget later released an 34 Substantially amending the PRA of 1980 (Pub. Regulations That Significantly Affect Implementation Guidance memorandum on July 13, L. 96–511). Energy Supply, Distribution, or Use’’) 2002. 35 44 U.S.C. 3502(2); 5 CFR 1320.3(b).

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Agencies must provide information to Annual Report,’’ no later than every $88 per hour. OMB approved this OMB on the parties affected, the annual March 15. The annual report must information collection under OMB reporting burden, the annualized cost of include data from the previous calendar Control No. 2137–0634 on October 11, responding to the information year. For example, the first annual 2018, and it will expire on October 31, collection, and whether the request report was due no later than March 15, 2021. No additional collection or significantly affects a substantial 2018, and must have included data from recordkeeping requirements would be number of small entities. An agency the 2017 calendar year. OMB approved imposed on the public by modifying the may not conduct or sponsor, and a this information collection, ‘‘Incident requirements of this final rule. person is not required to respond to, an and Annual Reports for Gas Pipeline information collection unless it displays Operators,’’ on August 16, 2017, under L. Privacy Act a currently valid OMB control number. Control No. 2137–0522, expiring on In accordance with the Privacy Act of OMB has previously approved the August 31, 2020. 1974, 5 U.S.C. 552(a), anyone can search information collection requirements In the IFR, PHMSA estimated a the electronic form of all documents contained in IFR under the provisions of reporting burden of 8 hours to complete received into any of our dockets by the the PRA. Since issuing the IFR, PHMSA each annual report form. That estimate name of the individual submitting the has estimated changes in reporting and included times for reviewing document (or signing the document, if recordkeeping burden and submitted a instructions, gathering the necessary submitted on behalf of an association, revised information collection request to data, and responding to each question. business, labor union, etc.). The OMB for approval. Below is a summary However, PHMSA revised the hourly complete Privacy Act statement is in the the information collections requested or burden estimate from 8 hours to 20 Federal Register published on April 11, approved for this final rule. hours per response based on public 2000, (65 FR 19477–78), or at the comments, which are available for website: https://www.transportation 1. Incident Reporting review in Docket No. PHMSA–2016– .gov/dot-website-privacy-policy. PHMSA is finalizing the IFR’s 0016. revision to 49 CFR 191.15 that requires M. Regulation Identifier Number (RIN) 4. National Registry of Operators and operators to give notice upon the A regulation identifier number (RIN) Notification of Changes discovery of incidents meeting the is the unique identifier for each definition at 49 CFR 191.3. Operators This information collection consists regulatory action listed in the Unified must submit DOT Form PHMSA– of two parts. The first part requires Agenda of Federal Regulations. The F7100.2 as soon as practicable but not operators to obtain or validate an Regulatory Information Service Center more than 30 days after they detect the Operator Identification Number (OPID) publishes the Unified Agenda in April event. On August 16, 2017, OMB from PHMSA. Under the IFR, PHMSA and October of each year. Use the RIN approved the use of this form, ‘‘Incident expected to receive 24 OPID requests number to find this rulemaking in the and Annual Reports for Gas Pipeline and 25 ad hoc notifications. PHMSA Unified Agenda. The RIN number for Operators,’’ under Control No. 2137– estimated that each operator would take this rulemaking is RIN 2137–AF22. 0522. 1 hour to complete the OPID Assignment form, PHMSA F 1000.1. List of Subjects 2. Safety-Related Conditions Reporting PHMSA is making no changes to these 49 CFR Part 191 PHMSA is finalizing the IFR’s estimates in this final rule. Underground natural gas storage The IFR revised § 191.22 to require revision to § 191.23 that requires facility reporting requirements. operators to report a safety-related operators to notify PHMSA, not less condition no later than ten working than 60 days prior, of certain events. 49 CFR Part 192 days after its discovery. PHMSA OMB approved this information Definitions, Incorporation by estimates it will receive four annual collection on July 5, 2017, and it will reference, Underground natural gas responses at an annual burden of 24 expire on July 31, 2020. PHMSA storage facility safety. hours from each operator. This estimate estimates that this final rule will result remains unchanged from the IFR’s in no additional hourly or cost burdens 49 CFR Part 195 estimate. beyond those estimated in the IFR. National Registry of Operators. On August 16, 2017, OMB approved PHMSA estimates the combined annual In consideration of the foregoing, this information collection, ‘‘Reporting burden for OPID Assignment and PHMSA is amending 49 CFR parts 191, Safety-related conditions on Gas, Operator Notification at 49 hours. (OMB 192, and 195 as follows: Hazardous Liquid, and Carbon Dioxide Control No. 2137–0627). Pipelines, and Liquefied Natural Gas PART 191—TRANSPORTATION OF 5. Recordkeeping Facilities,’’ under Control No. 2137– NATURAL AND OTHER GAS BY 0578, expiring on August 31, 2019. As discussed throughout this PIPELINE; ANNUAL REPORTS, There is no form dedicated to this rulemaking, operators must create and INCIDENT REPORTS, AND SAFETY- information collection. Instead, PHMSA maintain records and in accordance RELATED CONDITION REPORTS will accept safety-related condition with RP 1170 and RP 1171. Operators reports in a variety of formats by mail must also create and maintain written ■ 1. The authority citation for part 191 or fax. Instructions for filing are in procedure manuals for integrity and continues to read as follows: § 191.25, ‘‘Filing safety-related program operations. Because of these Authority: 49 U.S.C. 5121, 60102, 60103, condition reports.’’ requirements in the IFR, and codified in 60104, 60108, 60117, 60118, 60124, 60132, this final rule, 136 entities will be and 60141; and 49 CFR 1.97. 3. Annual Reporting required to keep records. PHMSA ■ 2. In § 191.1, revise paragraph (a) to PHMSA is finalizing the IFR’s estimates that it will take operators read as follows: amendment to § 191.17, related to approximately 1.6 hours annually to annual reporting. Operators must maintain the required records. The cost § 191.1 Scope. submit data Form 7100.4–1, and hourly burden are based on 136 (a) This part prescribes requirements ‘‘Underground Natural Gas Storage companies with a loaded labor cost of for the reporting of incidents, safety-

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related conditions, annual pipeline (d) Supplemental report. Where (iv) Maintenance of a UNGSF that summary data, National Registry of additional related information is involves the plugging or abandonment Operators information, and other obtained after an operator submits a of a well, or that requires a workover rig miscellaneous conditions by operators report under paragraph (a), (b), or (c) of and costs $200,000 or more for an of underground natural gas storage this section, the operator must make a individual well, including its wellhead. facilities and natural gas pipeline supplemental report as soon as If 60-days’ notice is not feasible due to facilities located in the United States or practicable, with a clear reference by an emergency, an operator must Puerto Rico, including underground date to the original report. promptly respond to the emergency and natural gas storage facilities and ■ 5. In § 191.17, revise paragraph (c) to notify PHMSA as soon as practicable. pipelines within the limits of the Outer read as follows: (2) An operator must notify PHMSA Continental Shelf, as that term is of any of the following events not later defined in the Outer Continental Shelf § 191.17 Transmission systems; gathering than 60 days after the event occurs: Lands Act (43 U.S.C. 1331). systems; liquefied natural gas facilities; and (i) A change in the primary entity underground natural gas storage facilities: * * * * * responsible (i.e., with an assigned OPID) Annual report. for managing or administering a safety ■ 3. In § 191.3, the definitions of * * * * * program required by this part covering ‘‘Incident’’ and ‘‘Underground natural (c) Underground natural gas storage pipeline facilities operated under gas storage facility’’ are revised to read facility. Each operator of a UNGSF must multiple OPIDs; as follows: submit an annual report through DOT (ii) A change in the name of the § 191.3 Definitions. Form PHMSA 7100.4–1. This report operator; must be submitted each year, no later (iii) A change in the entity (e.g., * * * * * than March 15, for the preceding company, municipality) responsible for Incident means any of the following calendar year. an existing pipeline, pipeline segment, events: ■ 6. Revise § 191.22 to read as follows: pipeline facility, UNGSF, or LNG (1) An event that involves a release of facility; gas from a pipeline, gas from an § 191.22 National Registry of Operators. (iv) The acquisition or divestiture of underground natural gas storage facility (a) OPID request. Effective January 1, 50 or more miles of a pipeline or (UNGSF), liquefied natural gas, 2012, each operator of a gas pipeline, pipeline system subject to part 192 of liquefied petroleum gas, refrigerant gas, gas pipeline facility, UNGSF, LNG this subchapter; or or gas from an LNG facility, and that plant, or LNG facility must obtain from (v) The acquisition or divestiture of an results in one or more of the following PHMSA an Operator Identification existing UNGSF, or an LNG plant or consequences: Number (OPID). An OPID is assigned to LNG facility subject to part 193 of this (i) A death, or personal injury an operator for the pipeline, pipeline subchapter. necessitating in-patient hospitalization; facility, or pipeline system for which (d) Reporting. An operator must use (ii) Estimated property damage of the operator has primary responsibility. the OPID issued by PHMSA for all $50,000 or more, including a loss to the To obtain an OPID, an operator must reporting requirements covered under operator and others, or both, but submit an OPID Assignment Request this subchapter and for submissions to excluding the cost of gas lost; or DOT Form PHMSA F 1000.1 through the National Pipeline Mapping System. (iii) Unintentional estimated gas loss the National Registry of Operators in ■ 7. Revise § 191.23 to read as follows: of three million cubic feet or more. accordance with § 191.7. (2) An event that results in an (b) OPID validation. An operator who § 191.23 Reporting safety-related emergency shutdown of an LNG facility has already been assigned one or more conditions. or a UNGSF. Activation of an emergency OPIDs by January 1, 2011, must validate (a) Except as provided in paragraph shutdown system for reasons other than the information associated with each (b) of this section, each operator shall an actual emergency within the facility OPID through the National Registry of report in accordance with § 191.25 the does not constitute an incident. Operators at https://portal.phmsa existence of any of the following safety- (3) An event that is significant in the .dot.gov, and correct that information as related conditions involving facilities in judgment of the operator, even though it necessary, no later than June 30, 2012. service: did not meet the criteria of paragraph (1) (c) Changes. Each operator of a gas (1) In the case of a pipeline (other or (2) of this definition. pipeline, gas pipeline facility, UNGSF, than an LNG facility) that operates at a * * * * * LNG plant, or LNG facility must notify hoop stress of 20% or more of its Underground natural gas storage PHMSA electronically through the specified minimum yield strength, facility (UNGSF) means an underground National Registry of Operators at https:// general corrosion that has reduced the natural gas storage facility or UNGSF as portal.phmsa.dot.gov of certain events. wall thickness to less than that required defined in § 192.3 of this chapter. (1) An operator must notify PHMSA for the maximum allowable operating ■ 4. In § 191.15, revise paragraphs (c) of any of the following events not later pressure, and localized corrosion pitting and (d) to read as follows: than 60 days before the event occurs: to a degree where leakage might result. (i) Construction of any planned (2) In the case of a UNGSF, general § 191.15 Transmission systems; gathering rehabilitation, replacement, corrosion that has reduced the wall systems; liquefied natural gas facilities; and modification, upgrade, uprate, or update thickness of any metal component to underground natural gas storage facilities: of a facility, other than a section of line less than that required for the well’s Incident report. pipe, that costs $10 million or more. If maximum operating pressure, or * * * * * 60-day notice is not feasible because of localized corrosion pitting to a degree (c) Underground natural gas storage an emergency, an operator must notify where leakage might result. facility. Each operator of a UNGSF must PHMSA as soon as practicable; (3) Unintended movement or submit DOT Form PHMSA F7100.2 as (ii) Construction of 10 or more miles abnormal loading by environmental soon as practicable but not more than 30 of a new pipeline; causes, such as an earthquake, days after the detection of an incident (iii) Construction of a new LNG plant, landslide, or flood, that impairs the required to be reported under § 191.5. LNG facility, or UNGSF; or serviceability of a pipeline or the

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structural integrity or reliability of a applicable safety standards before the Reservoirs and Aquifer Reservoirs,’’ UNGSF or LNG facility that contains, deadline for filing the safety-related First edition, September 2015, (API RP controls, or processes gas or LNG. condition report, except that reports are 1171), IBR approved for § 192.12. (4) Any crack or other material defect required for conditions under paragraph * * * * * that impairs the structural integrity or (a)(1) of this section other than localized ■ 11. Revise § 192.12 to read as follows: reliability of a UNGSF or an LNG corrosion pitting on an effectively facility that contains, controls, or coated and cathodically protected § 192.12 Underground natural gas storage processes gas or LNG. pipeline. facilities. (5) Any material defect or physical (5) Exists on an UNGSF, where a well Underground natural gas storage damage that impairs the serviceability of or wellhead is isolated, allowing the facilities (UNGSFs), as defined in a pipeline that operates at a hoop stress reservoir or cavern and all other § 192.3, are not subject to any of 20% or more of its specified components of the facility to continue to requirements of this part aside from this minimum yield strength, or the operate normally and without pressure section. serviceability or the structural integrity restriction. (a) Salt cavern UNGSFs. (1) Each of a UNGSF. UNGSF that uses a solution-mined salt (6) Any malfunction or operating error PART 192—TRANSPORTATION OF cavern for natural gas storage and was that causes the pressure of a pipeline or NATURAL AND OTHER GAS BY constructed after March 13, 2020, must underground natural gas storage facility PIPELINE: MINIMUM FEDERAL meet all the provisions of API RP 1170 or LNG facility that contains or SAFETY STANDARDS (incorporated by reference, see § 192.7), processes natural gas or LNG to rise the provisions of section 8 of API RP ■ above its maximum well operating 8. The authority citation for part 192 1171 (incorporated by reference, see pressure (or working pressure for LNG continues to read as follows: § 192.7) that are applicable to the facilities) plus the margin (build-up) Authority: 49 U.S.C. 5103, 60102, 60104, physical characteristics and operations allowed for operation of pressure 60108, 60109, 60110, 60113, 60116, 60118, of a solution-mined salt cavern UNGSF, limiting or control devices. 60137, and 60141; and 49 CFR 1.97. and paragraphs (c) and (d) of this (7) A leak in a pipeline, UNGSF, or ■ 9. In § 192.3, revise the definition of section prior to commencing operations. LNG facility containing or processing ‘‘Underground natural gas storage (2) Each UNGSF that uses a solution- gas or LNG that constitutes an facility’’ to read as follows: mined salt cavern for natural gas storage emergency. and was constructed between July 18, (8) Inner tank leakage, ineffective § 192.3 Definitions. 2017, and March 13, 2020, must meet all insulation, or frost heave that impairs * * * * * the provisions of API RP 1170 the structural integrity of an LNG Underground natural gas storage (incorporated by reference, see § 192.7) storage tank. facility (UNGSF) means a gas pipeline and paragraph (c) of this section prior to (9) Any safety-related condition that facility that stores natural gas commencing operations, and must meet could lead to an imminent hazard and underground incidental to the all the provisions of section 8 of API RP causes (either directly or indirectly by transportation of natural gas, including: 1171 (incorporated by reference, see remedial action of the operator), for (1)(i) A depleted hydrocarbon § 192.7) that are applicable to the purposes other than abandonment, a reservoir; physical characteristics and operations 20% or more reduction in operating (ii) An aquifer reservoir; or of a solution-mined salt cavern UNGSF, pressure or shutdown of operation of a (iii) A solution-mined salt cavern. and paragraph (d) of this section, by pipeline, UNGSF, or an LNG facility (2) In addition to the reservoir or March 13, 2021. that contains or processes gas or LNG. cavern, a UNGSF includes injection, (3) Each UNGSF that uses a solution- (10) [Reserved] withdrawal, monitoring, and mined salt cavern for natural gas storage (11) Any malfunction or operating observation wells; wellbores and and was constructed on or before July error that causes the pressure of a downhole components; wellheads and 18, 2017, must meet the provisions of UNGSF using a salt cavern for natural associated wellhead piping; wing-valve API RP 1170 (incorporated by reference, gas storage to fall below its minimum assemblies that isolate the wellhead see § 192.7), sections 9, 10, and 11, and allowable operating pressure, as defined from connected piping beyond the paragraph (c) of this section, by January by the facility’s State or Federal wing-valve assemblies; and any other 18, 2018, and must meet all provisions operating permit or certificate, equipment, facility, right-of-way, or of section 8 of API RP 1171 whichever pressure is higher. building used in the underground (incorporated by reference, see § 192.7) (b) A report is not required for any storage of natural gas. that are applicable to the physical safety-related condition that— * * * * * characteristics and operations of a (1) Exists on a master meter system or ■ 10. Republished § 192.7(b)(10) and solution-mined salt cavern UNGSF, and a customer-owned service line; (11) continue to read as follows: paragraph (d) of this section, by March (2) Is an incident or results in an 13, 2021. incident before the deadline for filing § 192.7 What documents are incorporated (b) Depleted hydrocarbon and aquifer the safety-related condition report; by reference partly or wholly in this part? reservoir UNGSFs. (1) Each UNGSF that (3) Exists on a pipeline (other than an * * * * * uses a depleted hydrocarbon reservoir UNGSF or an LNG facility) that is more (b) * * * or an aquifer reservoir for natural gas than 220 yards (200 meters) from any (10) API Recommended Practice 1170, storage and was constructed after July building intended for human occupancy ‘‘Design and Operation of Solution- 18, 2017, must meet all provisions of or outdoor place of assembly, except mined Salt Caverns Used for Natural API RP 1171 (incorporated by reference, that reports are required for conditions Gas Storage,’’ First edition, July 2015 see § 192.7), and paragraphs (c) and (d) within the right-of-way of an active (API RP 1170), IBR approved for of this section, prior to commencing railroad, paved road, street, or highway; § 192.12. operations. or (11) API Recommended Practice 1171, (2) Each UNGSF that uses a depleted (4) Is corrected by repair or ‘‘Functional Integrity of Natural Gas hydrocarbon reservoir or an aquifer replacement in accordance with Storage in Depleted Hydrocarbon reservoir for natural gas storage and was

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constructed on or before July 18, 2017, (iv) A plan for how staff will be baseline assessment for each reservoir, must meet the provisions of API RP trained in awareness and application of cavern, and well. 1171 (incorporated by reference, see the procedures required by this (4) Integrity management procedures § 192.7), sections 8, 9, 10, and 11, and paragraph (d); and recordkeeping. Each UNGSF paragraph (c) of this section, by January (v) Timelines for implementing each operator must establish and follow 18, 2018, and must meet all provisions program element, including the risk written procedures to carry out its of paragraph (d) of this section by March analysis and baseline risk assessments; integrity management program under 13, 2021. and API RP 1171 (incorporated by reference, (c) Procedural manuals. Each operator (vi) A plan for how to incorporate see § 192.7), section 8 (‘‘Risk of a UNGSF must prepare and follow for information gained from experience into Management for Gas Storage each facility one or more manuals of the integrity management program on a Operations’’), and this paragraph (d). written procedures for conducting continuous basis. The operator must also maintain, for the operations, maintenance, and (2) Integrity management baseline useful life of the UNGSF, records that emergency preparedness and response demonstrate compliance with the activities under paragraphs (a) and (b) of risk-assessment intervals. No later than March 13, 2024, each UNGSF operator requirements of this paragraph (d). This this section. Each operator must keep includes records developed and used in records necessary to administer such must complete the baseline risk assessments of all reservoirs and support of any identification, procedures and review and update these calculation, amendment, modification, manuals at intervals not exceeding 15 caverns, and at least 40% of the baseline risk assessments for each of its UNGSF justification, deviation, and months, but at least once each calendar determination made, and any action year. Each operator must keep the wells (including wellhead assemblies), beginning with the highest-risk wells, as taken to implement and evaluate any appropriate parts of these manuals integrity management program element. accessible at locations where UNGSF identified by the risk analysis process. work is being performed. Each operator No later than March 13, 2027, an PART 195—TRANSPORTATION OF must have written procedures in place operator must complete baseline risk HAZARDOUS LIQUIDS BY PIPELINE before commencing operations or assessments on all its wells (including beginning an activity not yet wellhead assemblies). Operators may ■ 12. The authority citation for part 195 implemented. use prior risk assessments for a well as continues to read as follows: (d) Integrity management program— a baseline (or part of the baseline) risk assessment in implementing its initial Authority: 49 U.S.C. 5103, 60102, 60104, (1) Integrity management program 60108, 60109, 60116, 60118, 60132, 60137, elements. The integrity management integrity management program, so long and 49 CFR 1.97. program for each UNGSF under this as the prior assessments meet the requirements of API RP 1171 ■ 13. In § 195.64: paragraph (d) must consist, at a ■ a. Revise the section heading; minimum, of a framework developed (incorporated by reference, see § 192.7), ■ b. Remove ‘‘National Registry of under API RP 1171 (incorporated by section 8, and continue to be relevant Pipeline and LNG Operators’’ and add reference, see § 192.7), section 8 (‘‘Risk and valid for the current operating and ‘‘National Registry of Operators’’ in its Management for Gas Storage environmental conditions. When place everywhere it appears; and Operations’’), and that also describes evaluating prior risk-assessment results, ■ c. Remove the website address how relevant decisions will be made operators must account for the growth ‘‘http://opsweb.phmsa.dot.gov’’ in and by whom. An operator must make and effects of indicated defects since the paragraphs (b) and (c) and add ‘‘https:// continual improvements to the program time the assessment was performed. portal.phmsa.dot.gov’’ in its place. and its execution. The integrity (3) Integrity management re- The revision reads as follows: management program must include the assessment intervals. The operator must following elements: determine the appropriate interval for § 195.64 National Registry of Operators. risk assessments under API RP 1171 (i) A plan for developing and * * * * * implementing each program element to (incorporated by reference, see § 192.7), meet the requirements of this section; subsection 8.7.1, and this paragraph (d) Issued in Washington, DC, on January 10, (ii) An outline of the procedures to be for each reservoir, cavern, and well, 2020, under authority delegated in 49 CFR 1.97. developed; using the results from earlier (iii) The roles and responsibilities of assessments and updated risk analyses. Howard R. Elliott, UNGSF staff assigned to develop and The re-assessment interval for each Administrator. implement the procedures required by reservoir, cavern, and well must not [FR Doc. 2020–00565 Filed 2–11–20; 8:45 am] this paragraph (d); exceed seven years from the date of the BILLING CODE 4910–60–P

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