April 2017, Vol. 244, No. 4

Government

Government

FERC Publishes Draft Guidance for Pipeline Consultations on Indian Lands

In an apparent effort to forestall the political problems that threatened construction of the Dakota Access pipeline, the Federal Energy Regulatory Commission (FERC) has published draft guidance for interstate pipeline companies with regard to how they should communicate with Indian tribes when planning projects that could impact cultural resources on or near Indian lands.

The draft is extremely detailed, starting with how pipeline operators should make contact with Indian tribes, what kind of consultations are required and what reports should be submitted, in what detail and to whom. Those consultations and reports are required under the National Historic Preservation Act (NHPA).

A spokeswoman for FERC said: “The purpose of the draft manual is to provide clarification and additional guidance. They do not alter or modify the existing FERC policy and it does not require the companies to conduct additional tribal outreach beyond what they are already pursuing.”

Though the Trump administration gave the Army Corps of Engineers the greenlight to approve the Dakota Access pipeline (DAPL) held up by the Obama administration, the issue of pipeline construction on Indian lands continues to reverberate politically, and not just at the FERC. The House Energy Subcommittee held a hearing Feb. 15 in which Chad Harrison, councilman-at-large, Standing Rock Sioux Tribe, reprised complaints and asked Congress to change federal law so that pipeline companies had to first obtain consent of Indian tribes before building facilities on or near their lands.

“At the very least, Congress should change the law to require that when infrastructure like this pipeline is proposed, the tribes have the right to impose conditions on the project to protect tribal interests and resources,” Harrison said.

Joey Mahmoud, executive vice president of Energy Transfer Partners, the builder of the DAPL, told the hearing that DAPL does not cross a single inch of tribal reservation or trust land. Nonetheless, the company reached out to the Standing Rock Sioux who “had no interest in discussing the project with us.” He added that the Army Corps reached out to the tribe on nine separate occasions.

“Despite these efforts, the Standing Rock declined to participate in any meaningful way,” he emphasized. Dakota Access employed dozens of cultural experts to work alongside state and tribal cultural officials to ensure that nothing of historic significance was disturbed. Based on their findings, the project undertook 140 route changes in North Dakota alone.

FERC draft guidelines lay out principles companies should follow when contacting Indian tribes: That no cultural-resources field work begin until after the project sponsor has initiated communications with consulting parties, and provide the parties with the opportunity to review and comment on project-specific research designs and survey strategies.

For example, companies are warned that when contacting a tribe the company must not “…state that the project sponsor ‘represents’ or is ‘delegated by’ or is writing ‘on behalf of’ FERC.” If the tribe refuses to provide input, the company has to file the documentation of this response with FERC.

Vicki Granado, a spokeswoman at Energy Transfer Partners, did not respond to queries about would have required the company to alter its approach on the DAPL.

Pipeline Groups Fire Latest Salvo Against Underground Safety Rules

Natural gas groups upped the ante in their fight against some of the provisions in the PHMSA underground gas storage safety interim final rule (IFR) published in January. Expanding objections to the compliance timetable – which kicks in  next January – four trade groups proposed a revised timetable with three dates, the longest starting in eight years, which would allow companies to implement the elements of the rule in a staggered fashion.

Moreover, they argue that the interim final rule converts “non-mandatory” provisions in the two API Recommended Practices that are the basis of the IFR to “mandatory” requirements, which INGAA, API, etc. describe as creating “unreasonable, not practical and often nonsensical regulatory requirements…”

The four associations are the American Gas Association, American Petroleum Institute, American Public Gas Association and Interstate Natural Gas Association of America. The IFR anticipates natural gas companies complying with two API  Recommended Practices (RPs): API RP 1170: Design and Operation of Solution-mined Salt Caverns used for Natural Gas Storage and API RP 1171: Functional Integrity of Natural Gas Storage in Depleted Hydrocarbon Reservoirs and Aquifer Reservoirs.

The plain text of the IFR requires operators of natural gas storage facilities to implement all actions under the applicable sections of API RP 1170 and 1171 within one year of the effective date of the IFR, that being Jan. 18, 2017. Those actions include undertaking a rigorous risk assessment to establish the appropriate preventative and mitigative measures to address the unique characteristics of each underground storage facility.

The four gas associations are pressing for a three-tier compliance schedule. Within 12 months, operators must have the foundational components of a functional integrity management system, including a written framework. Within three years, a storage functional integrity management system must be in place. Within three to eight years, operators must complete underground gas storage facility risk assessments, including the baseline integrity assessments and preventative and mitigative measures warranted by the risk assessment.

The associations argue that compliance by January 2018 with some of the provisions is impossible, given the shortage of some types of equipment. For example, API RP 1171 Section 9.3 requires operators to evaluate and monitor well integrity. Based on the outcome of an operator’s risk evaluation, this section could require the use of wireline and/or “slickline” trucks and multi-caliper tools to conduct downhole casing inspection logging, along with personnel qualified to conduct these complex operations.

“The limited availability of equipment and personnel will have a direct impact on the timing of implementing the IFR,” the associations contend. “PHMSA’s one-year compliance timeframe cannot be achieved, given the necessary scheduling and allocating of this specialized equipment and qualified personnel.”

Budgets for EPA Water Infrastructure Grants Endangered

 

President Trump’s intention to drastically cut the budget of the Environmental Protection Agency (EPA) (and other departments and agencies) could have a major impact on the agency’s two key water infrastructure programs, the Clean Water and Drinking Water State Revolving Funds. Early leaks of the president’s budget reported that the EPA’s grant programs, of which the SRFs are a part, would be cut by 30%. That would be intended for fiscal year 2018, which begins Oct. 1, 2017.