U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Pipeline Safety Forum Linda Daugherty, Deputy Associate Administrator, Office of Pipeline Safety

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Focus on Pipeline Safety Secretary Ray LaHood and Administrator Cynthia Quarterman are directing action to assure pipeline infrastructure is fit for service and can safely provide energy to future generations.

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Focus on Pipeline Safety Secretary LaHood and Administrator Quarterman have meet with various executives, including the FERC Chairman, Company Presidents and others to gain their commitment Secretary LaHood Hosted a National Pipeline Safety Forum at DOT on April 18, 2011 –What we heard: Summary on Forum website –Continuing request for input and ideas Posted in website library –DOT Action Items identified, including Report to America

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Focus on Pipeline Safety Shared Responsibility: DOT continues to emphasize the need to elevate attention at LOCAL, STATE and FEDERAL levels on pipeline safety challenges –Legacy infrastructure impacts everyone: risk assessments, repair, rehabilitation, and replacement or requalification –Rate Recovery Mechanisms (Who pays?)

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Focus on Pipeline Safety Report to American on Pipeline Safety – 6 months Helping to educate Americans about the pipeline infrastructure Broad overview and not overly into weeds Fact-based and neutral as much as possible –Include input/guidance from public, private and government sectors –Seeking solutions to challenges (we don’t have all of the answers!)

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Draft Outline & Major Messages for the Secretary’s Report to the Nation on Pipeline Safety

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Draft Outline – Comments Received Commenters responding from –Industry – 2 –States – 1 –Federal Regulators – 5 –Public – 2 To date, only one state, the Pipeline Safety Trust and the liquid pipeline industry have suggested source material. –Some very recent contributions may be pending Preliminary Draft Infrastructure Report will be used to flesh outline where appropriate.

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Draft Outline – Chapters 1.Energy Pipelines in the US – the Various Types and their Role in Daily Life 2.Roles and Responsibilities of Key Stakeholders 3.Safety and the Environmental Record 4.Challenges & Issues 5.Continuous Improvement: Recent Changes and Ongoing Initiatives 6.Ideas for New Initiatives

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 1. Energy Pipelines in the US – the Various Types and their Role in Daily Life Key Messages: In today’s economy, petroleum, other hazardous liquids and natural gas are fundamental to our way of life; the vast majority of these materials are transported to end users by pipelines. Pipeline operators, generally private enterprises, charge for transportation services via rates that are typically regulated in some way by various government entities.

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 1. Energy Pipelines in the US – the Various Types and their Role in Daily Life Possible Sections in Chapter 1 a.Value of Pipelines to the Public – how much of the public benefits from pipelines b.Types of pipelines & diversity of operators (e.g., gas distribution, gas transmission, liquid transmission, gas and crude oil gathering, LNG; private enterprise and public entity) c.Commodities transported, fraction transported by pipeline, and end uses d.Age and condition of pipeline infrastructure

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 2. Roles and Responsibilities of Key Stakeholders Key Messages Numerous stakeholders have roles in assuring the safety; the public, pipeline operators (large multi-national companies to very small local municipalities), federal & state regulators, state & local officials, federal and state siting agencies, developers, and excavators Identification of pipeline safety issues is a joint responsibility of industry and regulators. Resolution of many, but not all, pipeline safety issues is the responsibility of and controllable by pipeline operators Improving pipeline safety sometimes requires significant expenditures by pipeline operators. Typical efforts involve replacing and repairing pipelines, applying new technologies to better control operations and better monitor the fitness for service of pipelines. Expenditures are often difficult for pipeline operators to recover in a competitive and financially regulated environment. Most costs to improve safety are ultimately passed along to the consumers or other users of the hazardous liquids and natural gas through rate cases or other special cost transfer means.

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 2. Roles and Responsibilities of Key Stakeholders Possible Sections in Chapter 2 a.Federal and State Pipeline Regulators b.County and Municipality Officials c.Rate Regulators –Most pipeline operators are common carriers –For municipal operators, rates are set by municipalities; competition exists for funds with other safety agencies d.Public Safety Officials e.Operators f.Affected Public g.Public Representatives h.Other Governmental Agencies i.Other Industry and Private Groups (Excavators and locators, Contractors, Associations, National Consensus Standard Groups)

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 3. Safety and Environmental Record Key Message: While there is clearly room for more safety improvements, pipelines represent lower risk than competing transportation technologies; environmental impacts may be more severe; trends show pipeline safety is generally improving

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 3. Safety and Environmental Record Possible Sections in Chapter 3 – Factors Affecting Pipeline Safety – Sources of Pipeline Safety Information – Reported Safety by Industry Sector (possibly include sub-sector like gathering) – How does the safety of pipeline transport compare with other transportation modes? – Consequences of Pipeline Failures

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 4. Challenges & Issues Key Messages Improving pipeline safety requires that industry, manufacturers and regulators focus their energy and resources on identifying and resolving a set of key known risks. Emerging or changing risks impacting pipeline safety will continue to arise as a result of new technologies (e.g., stronger materials leading to larger thinner pipelines), different physical characteristics of materials being transported, and changing environmental factors (e.g., frequency and severity of storms, seismic events). Pipeline operators and regulators must manage the emerging risks as well as the known risks. To drive accidents and injuries to zero, pipeline operators and regulators must address a broad array of contributing factors.

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 4. Challenges & Issues Possible Sections in Chapter 4 a.What are the challenges for getting to zero incidents – areas of improvement Aging Infrastructure Technology Limitations and Development (e.g., accuracy of assessment capability) Imperfect knowledge of infrastructure Controllability of Threats (e.g., land use, excavation damage) Loss of experience – aging industry and regulatory workforce Human reliability Financial commitment Safety Culture Operator Transparency Regulatory challenges such as the need cost-benefit analyses

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 4. Challenges & Issues b. Focus of resources Operator focus Regulatory Focus Definition and Appropriateness of emphasis on high consequence areas) c. Identifying Areas for Improvement - Learning from Experience Gathering and Understanding Performance Data Evaluating Underlying Causes of Events Communicating Implications Developing and Sharing Best Practices

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 4. Challenges & Issues d. Adequacy of Enforcement e. Correctness of Regulatory Approach – prescriptive vs. performance-based regulations f. Means for improving awareness and involvement of the affected public g. Regulatory Gaps and Overlaps h. Lack of consistency among operators – weak link i. Capacity and limitations on gas delivery j. Public communications k. Economic Considerations

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 5. Continuous Improvement: Recent Changes and Ongoing Initiatives Key Messages: Many, but not all, of the recognized key safety issues are already being addressed through established programs such as integrity management regulations and high-risk pipe replacement and repair programs; programmatic improvements and accelerated actions may be required to meaningfully improve pipeline safety Much is currently being done to improve pipeline safety; however, these improvements may not be effectively communicated or well understood by all key stakeholders, including the public. Many new programs and requirements are not yet fully implemented and the benefits are yet to be realized (low stress, DIMP, CRM, PIPA).

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 5. Continuous Improvement: Recent Changes and Ongoing Initiatives Possible Sections in Chapter 5 a.What is being done to eliminate incidents and the minimize the impact of accidents i.Regulatory initiatives –Approaches to Inspection & Enforcement »Risk-based inspections –Improved data acquisition and analysis –New regulations – strengthened data integration –Emergency response –Innovative cost recovery ii.Industry activities and initiatives –Leadership fostering improved safety culture –Data assembly & analysis –Lessons learned development & communication

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 5. Continuous Improvement: Recent Changes and Ongoing Initiatives iii. Public awareness and involvement iv. Collaborative initiatives –Common Ground Study and CGA –PIPA –NASFM-sponsored Training v. Technology Improvement - R&D –New construction techniques and materials –Improved assessment technology –Improved understanding of existing pipelines b. Legislative Initiatives

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 6. Ideas for New Initiatives Key Messages Continued improvement of regulations, oversight, management practices, safety technology and vigilance, both by the operators and by other key stakeholders, will be needed to drive accidents and injuries to zero. There are important roles for all key stakeholders in continuing to improve pipeline safety

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 6. Ideas for New Initiatives Possible Sections in Chapter 6 a.Better Information Sharing Among Key Stakeholders Local or individual initiatives that might be broadened What have operators/regulators/public done in the past What new ideas are being pursued (e.g., industry-sponsored data collection & analysis, leadership development initiatives, innovative rate recovery strategies) b.Adequacy of resources (numbers and qualifications) for both regulators and operators c.Learn lessons from International pipeline safety efforts d.Remove inappropriate barriers to implementing new technology

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration This is a Start but… We still need: Your Ideas and Input Thoughts and Concerns Possible Solutions Pictures Links to Resource Materials Send information, documents and ideas to: