Washington, D.C. has been a busy place this summer on both the regulatory and legislative fronts.

On the legislative front, Congress put a tremen-dous amount of work into the “Protecting Our Infrastructure of Pipelines and Enhancing Safety Act of 2016” (PIPES Act) that President Obama signed into law. The PIPES Act, a bipartisan bill, reauthorizes the U.S. Pipeline and Hazardous Materials Safety Administration (PHMSA) safety program.

So how does this impact those of us operating in the midstream sector?

The first thing to note is this is a three-year reauthoriza-tion. In about two years, Congress will start this process all over again. In the meantime, we have some regulatory certainty.

The reauthorization requires PHMSA to prioritize completion of nearly a dozen outstanding legislative mandates from the 2011 reauthori-zation. It also requires PHMSA to develop underground natural gas stor-age standards within the next two years in response to last year’s Aliso Canyon situation. And it requires a number of studies to be completed, including one for lost and unaccounted for gas and another for pipeline odorization.

From the GPA Midstream Associ-ation’s perspective, one of the most concerning provisions under this new reauthorization is that the PHMSA

administrator is granted new emergency order authority. PHMSA now has the authority to issue emergency orders to impose industrywide operational restrictions, prohibitions or safety measures if it believes an unsafe condition or practice results in an imminent hazard. PHMSA should have the nec-essary tools at its disposal to respond to industrywide emer-gencies, and it already has those tools available in the form of corrective-action orders, advisory bulletins, safety orders, compliance orders and even the good-clause exception under the Administrative Procedures Act that allows agencies to issue final rules without providing notice and comment in an emergency.

This new power means PHMSA can shut down midstream operations if it believes there is an imminent hazard or substantial endangerment to the environment that may occur before a fore-seeable completion date of a formal review process.

GPA Midstream’s main concern is that these new emergency order powers could be used in lieu of rulemaking and enforcement proceedings—shortchanging our members of due process.

The PIPES Act version results from different sides coming together to try to devise the best possible solution. So while GPA Midstream was actively involved in this process and worked hard to get this to where it was somewhat acceptable, we still have con-cerns about the final product.

We urge PHMSA—if it has to use these new powers—to do so in a sparing and restrained manner.

GPA Midstream also worked hard to ensure that gathering lines did not come under greater scrutiny in the PIPES Act. This was accomplished by working with congressional members to explain the current regulatory structure for gathering lines.

In addition, PHMSA released the proposed “Safety of Gas Transmission and Gathering Pipelines” rule that reg-ulates gathering lines. PHMSA’s rollout of this proposed rule demonstrated that legislative action on gathering lines was unwarranted. PHMSA pro-posed this rule in response to its out-standing legislative mandates from the 2011 reauthorization.

On the regulatory front, the comment period has closed for that proposed gath-ering line rule. The rule itself is extensive, with close to 500 pages of regulatory text

and another 500-plus pages of regulatory impact analysis. The rule’s potential impact on the midstream industry is quite signifi-cant with many concerning provisions.

In the proposed rule, PHMSA is recommending a vast increase in the amount of gathering lines regulated. The proposed record-keeping scope appears to be a gross overreach of what Congress intended PHMSA to collect. Also, PHMSA failed to conduct a required data analysis on gathering lines yet still moved forward with this rule.

Additionally, PHMSA’s proposed total cost of this rule is esti-mated to be $47 million. GPA Midstream believes this is a gross mis-calculation of the true costs and believes the costs to comply passed onto the midstream industry will be exponentially higher.

Matthew Hite is vice president of government affairs for the GPA Midstream Association.

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