A final rule published adopting safety standards applicable to underground natural gas storage facilities, said officials at the Pipeline and Hazardous Materials Safety Administration (PHMSA).

The new regulations, approved last week, become effective on March 13 this year, with several specific compliance deadlines.

The Protecting Our Infrastructure of Pipelines and Enhancing Safety Act of 2016 (PIPES Act) required PHMSA to issue safety standards for underground natural gas storage facilities. To the extent practicable, PHMSA was directed to consider consensus standards, environmental protection, integrity management, and economic impacts. In December 2016, PHMSA issued an Interim Final Rule (IFR) incorporating by reference into PHMSA’s Part 192 safety standards two recommended practices (RP) of the American Petroleum Institute (API), the July 2015 edition of API RP 1170, “Design and Operation of Solution-Mined Salt Caverns Used for Natural Gas Storage,” and the September 2015 edition of API RP 1171, “Functional Integrity of Natural Gas Storage in Depleted Hydrocarbon Reservoirs and Aquifer Reservoirs.

Among other things, the IFR required operators of underground natural gas storage facilities comply with API RP 1170 and 1171, including their non-mandatory provisions, by January 18, 2018. PHMSA later stayed enforcement of the non-mandatory provisions.

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The final rule modifies the IFR in several ways, such as:

The final rule retains API RP 1170 and API RP 1171 as the basis for regulating safety of underground natural gas storage and continues to incorporate them by reference into the regulations. In a departure from the IFR, however, operators are not required to treat non-mandatory provisions as mandatory directives. In the final rule, PHMSA said “because these non-mandatory provisions are closely tied to the mandatory provisions that operators must meet, any non-mandatory provision remains enforceable to the extent that it is necessary, in the context of a particular operator or facility, to ensure compliance with a mandatory provision.” An operator also will not be required to justify why it does not implement a non-mandatory provision.

In response to comments stating codifying storage regulations in Part 192 could cause confusion regarding the applicability of other Part 192 regulations to storage, PHMSA also modified the definition of an underground natural gas storage to exclude components of a gas pipeline facility subject to other provisions of Part 192.

Operators must apply integrity management principles to storage facilities. The final rule requires operators apply integrity and risk management principles to underground natural gas storage facilities.

Key provisions include:

  • Operators of salt cavern storage facilities must apply the risk management principles of section 8 of API RP 1171 which applies to depleted reservoirs and aquifers. Section 8 of 1171, which has no counterpart in API RP 1170, outlines a framework for data collection, threat and hazard analyses, risk assessment methodology, preventive and mitigative measures, risk monitoring, and record-keeping. Operators of salt-cavern underground natural gas storage facilities will be required to apply these provisions to the extent they apply to the physical characteristics and operations of solution-mined salt caverns.
  • All operators of underground natural gas storage facilities must have integrity management plans that include the elements specified in new 49 C.F.R.
  • Operators must complete all baseline assessments for reservoirs and salt caverns and 40 percent of individual wells, starting with highest risk wells first, by March 13, 2024. Baseline assessments for the remaining 60 percent of wells must be completed by March 13, 2027.
  • Operators must perform periodic assessments and comply with recordkeeping requirements.
  • Click here for more information on the new rule.

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