GRAND JUNCTION SENTINEL 3-30-13 Who Is Minding the Pipelines

Mar 30, 2013

This aerial view was captured in a flyover provided by EcoFlight. It depicts the Parachute Creek leak site looking east shows orange fencing that indicates trenched areas associated with the ongoing investigation, as well as part of the pipeline corridor where 6,000 gallons of liquid hydrocarbons were recovered. Pipelines in the corridor cross under the creek.

On a July day in 2010, paraffin and an oily sheen showed up in a groundwater seep from a wall of a Rifle-area gravel pit that’s owned by Dan and Doug Grant and sits near the Colorado River.

The source? A produced-water pipeline associated with oil and gas development.

The pipeline had a faulty weld, and the Grants say the energy developer responsible for the line, Antero Resources, has never been able to show documentation that it was tested as required before being put into service.

The Colorado Oil and Gas Conservation Commission “basically relies on contractors and the oil boys to come in and test it. They just didn’t do it,” Dan Grant said.

Just what is required in terms of safety regulations pertaining to oil and gas pipelines, and the adequacy of enforcement, are likely to undergo new scrutiny in light of the discovery this month of a leak near Parachute. Some 6,000 gallons of a still-undetermined liquid hydrocarbon were recovered near Parachute Creek in a pipeline corridor four miles northwest of the town.

Williams found the contamination while doing pipeline location work in association with another natural gas processing plant it plans to build on the same property as its current Parachute Creek Gas Plant. An investigation continues into the possible source of the leak but has been focusing on a valve box for a 4-inch-diameter natural gas liquids line leaving the plant.

Officials say any number of agencies could be tasked with regulating the infrastructure around the leak, but until the leak source is identified, it remains unclear which entity is actually in charge.

The leak has contaminated groundwater, and high levels of carcinogenic benzene have been found in groundwater just 30 feet from Parachute Creek, a tributary to the Colorado River. Authorities say the creek doesn’t appear to have been contaminated.

Bob Arrington, a retired engineer who lives in nearby Battlement Mesa and is a citizen activist on oil and gas issues, said pipelines don’t get much attention from the commission, which focuses more on regulating drilling and well pad activities. Entities at local, state and federal levels have some hand in pipeline regulations, and gray areas arise regarding regulation and enforcement, he said.

“That is a big area of controversy for a lot of people because the pipelines are just as important” as other aspects of oil and gas regulations, he said.

The commission has pipeline regulations that apply to what it calls flow lines. State Department of Natural Resources spokesman Todd Hartman said those rules apply to oil and gas lines leading from wells directly to a processing facility or to what are called gathering lines. He said they also apply to production water lines. The rules do things such as dictate piping materials that must be used and require pressure-testing before use and once per year.

Commission Director Matt Lepore said he expects the agency to give its pipeline regulations new scrutiny to see if changes could help prevent an incident like the one up Parachute Creek.

“Any time there is an event like this we need to look at how it came to be, why did this happen, how did it happen, and in light of that look at our regulations, and we will do that,” he said.

Gathering line gray area

New discussions about pipeline regulations could also turn to the issue of gathering line regulations, particularly as they apply to rural areas. Those lines transport oil and gas from production areas to processing facilities.

Nationwide, pipeline safety is regulated by the Department of Transportation’s Pipeline and Hazardous Materials Safety Administration, covering aspects such as construction, testing, inspection and maintenance. However, its regulations currently apply to only about 10 percent of the 200,000 miles of natural gas gathering lines nationwide, and about 4,000 of the 30,000 to 40,000 hazardous liquids gathering lines, according to a 2012 Government Accountability Office report.

The safety administration doesn’t regulate natural gas gathering lines in areas with fewer than 10 buildings per mile intended for human occupancy within 220 yards of a line — what are called Class 1 areas.

Deborah Goldberg, an attorney with Earthjustice’s Northeastern U.S. office, questions what she calls a “kind of a cost-benefit analysis” by the government of risk in rural areas.

“Frankly, the people who live in the low-populated areas, their lives are as important to them as populated areas,” she said.

The pipeline safety administration regulates hazardous liquids gathering pipelines in the case of ones that are in communities, cross waterways used for commercial navigation, or are in rural areas that come within a quarter-mile of environmentally sensitive areas.

The administration has arrangements with states including Colorado to oversee various pipelines. Goldberg said those arrangements rarely result in requirements more stringent than federal requirements.

Carl Weimer, executive director of the Pipeline Safety Trust watchdog group, said some gathering lines “are pretty much unregulated by anybody, which always strikes people as amazing.”

The administration has a regulatory agreement with the Colorado Public Utilities Commission, but only for safety involving intrastate natural gas lines, said utilities spokesman Terry Bote. And generally that jurisdiction is only for distribution lines to utility customers.

“Typically gathering is not part of our safety oversight,” he said, although he said he thinks there are some circumstances where it might be. He was unable to elaborate on that last week.

The oil and gas commission actually rescinded some rules it had applied to gathering lines as part of its regulatory overhaul of 2008. According to an explanatory document, it said that was because of new federal Department of Transportation rules leading to duplication and conflict between commission and utilities rules. It said it decided to rescind its rules until the utilities commission delineates the pipelines under its jurisdiction.

“Gathering lines, if they are not regulated by the local government, then they kind of fall through the cracks” said Tresi Houpt, a former Garfield County commissioner who also was a state oil and gas commissioner at the time of the rules rewrite.

Garfield County has passed pipeline rules that Houpt said were partly a response to concern over lack of gathering line rules, although she thinks they didn’t go far enough.

They deal with things such as revegetation, siting lines and minimizing visual impacts. But the county once temporarily halted work on another Antero Resources pipeline project because of concerns over large rocks in the pipeline trench that could cause leaks.

Josh Joswick, with the Oil and Gas Accountability Project in southwest Colorado, said he brought up shortcomings in safety regulations for gathering pipelines during the oil and gas commission’s discussions last year.

“That’s as far as it went. They were not interested in dealing with that, although they acknowledged that it is something that needs to be addressed,” he said.

The Government Accountability Office report notes that there are far fewer fatalities associated with pipelines than with transport by truck and rail. And traditionally, it added, gathering pipelines are smaller than other lines — 2 to 12 inches in diameter — and operate at relatively low pressures of 5 to 800 pounds per square inch. But it said larger, higher-pressure gathering lines are cropping up in association with the nation’s growing development of shale gas. Local energy companies have begun doing some shale drilling.

Local companies’ regimens

WPX Energy, which has some 4,400 natural gas wells in western Colorado’s Piceance Basin, has about 375 gas flow and gathering lines and about 150 miles of water transportation lines, from 2 to 20 inches in diameter, company spokeswoman Susan Alvillar said.

Few of the pipelines in WPX’s system are regulated by the federal Department of Transportation, Alvillar said.

But she added, “Any anomalies with the gas lines would be apparent to the two people who watch each well every day via our telemetry system. In addition, there are safety systems in place at the pad processing equipment which would close the well under certain conditions. We pressure test the pipelines on a regular schedule. There is also cathodic protection placed on the lines, which involves a current which reduces corrosion.

“WPX has a very large stake in assuring that there are no gas leaks, as the company is paid on what it delivers to the processing plant.”

Water lines undergo preventative measures such as being physically checked when in use, she indicated.

“At WPX, we treat all of our lines as flowlines and our testing of all of our lines goes above and beyond what the COGCC prescribes. In fact, if you want to separate out the gathering lines, they are tested to 10 percent above what maximum operating pressure is on the line on a regular schedule.”

Williams transports and processes gas rather than producing it. Most of its gas lines in Colorado consist of transmission rather than gathering lines, putting them under heightened regulation. Williams spokesman Tom Droege said federal and state regulations require pipeline operators to conduct periodic pipeline corridor patrols, which Williams does by plane, vehicle and on foot.

“In addition to visual methods, leak detection equipment is commonly used in some types of patrols,” he said.

Goldberg, of Earthjustice, said inspections, something typically not required in most states in Class 1 areas, are important because they can detect things such as dead vegetation that can be associated with a methane leak.

Besides the climate impacts of possible leaks (methane is a potent greenhouse gas) leaking methane poses an explosion hazard and can get in water at places such as stream crossings, she said. That methane can contain benzene and other hazardous substances.

A liquid pipeline leak can cause extensive soil or water contamination if it goes unnoticed for a long time, she said.

Energy companies rely on pressure flow monitoring as one means of detecting leaks. When the Parachute leak was first detected, companies cited a lack of pressure drops in indicating pipelines didn’t appear to be leaking. But a study conducted for the pipeline safety administration said it’s acknowledged that such systems “will catch, at best, large ruptures.”

Other pipeline players

Other entities have a hand in pipeline regulation. For example, the city of Rifle has authority in the watershed area supplying its municipal supply, which includes Beaver Creek south of town. City Manager John Hier said engineers review pipeline applications in the watershed and can recommend requirements addressing construction and other matters, such as creek crossings. Those same engineers then do inspections during construction, he said.

“They put some pretty stringent requirements on them when they cross places like Beaver Creek,” Hier said.

The Bureau of Land Management imposes pipeline conditions that can vary depending on the project, and are addressed through environmental assessments, said agency spokeswoman Vanessa Lacayo. Petroleum engineers and other BLM staff do inspections to ensure requirements are followed.

She said the agency works with safety administration on all pipeline right-of-way projects.

Recently, energy companies proposed two Garfield County lines crossing beneath the Colorado River, a drinking water source for downstream communities in Colorado and beyond. According to the environmental analysis and approval decision for one of them, the entire 30-inch-diameter line, which also would cross several tributaries to the river, would be subject to safety administration testing requirements.

While questions may linger over gathering line regulations, both Houpt and Hartman said the oil and gas commission has jurisdiction over exploration and production waste and spills, which can include material released from gathering lines.

However, Hartman said the natural gas liquids line near Parachute isn’t a gathering line.

That line runs from the gas plant and below the creek to tanks on the other side. It’s actually regulated by another agency, the Occupational Safety and Health Administration, said Sara Delgado, another Williams spokeswoman. That’s apparently because it’s part of the plant operation.

From the tanks, the liquids are transported to Williams’ Willow Creek gas plant in Rio Blanco County, where they are combined with that plant’s liquids for transportation out of state. Where the pipeline exits the Parachute tanks, it is regulated by the safety administration, she said.

Hartman said the question of jurisdiction can’t be answered definitively until the leak source is determined. Depending on what’s learned, the Colorado Department of Public Health and Environment may have an oversight role, working with the gas commission to continue addressing the situation. The health and environment department already has been involved in the investigation.

Reactive versus proactive?

Arrington, of Battlement Mesa, said that “most regulatory action comes when there’s a pipeline accident,” which is a reactionary approach.

He said more pipeline inspectors are needed, and regulators rely too much on companies to monitor their lines.

Antero received a gas commission notice of alleged violation in connection with the 2010 leak, which contaminated gravel pit settling ponds the Grants drew from for crop irrigation. Doug Grant said they used that water for a year after the pipeline was put in and probably started leaking, not knowing the water might be tainted.

According to an Antero spill report for the case, the produced water involved typically contains 400 to 800 parts per million of oil.

Dan Grant said benzene levels in some contaminated water measured 20,000 parts per billion, compared to the state standard of 5 ppb or less.

Antero eventually removed contaminated soil, and the site is being monitored.

The commission hasn’t formally found Antero in violation, but Hartman said the matter “is under ongoing enforcement.”

The Grants are frustrated by rules that could limit any fine against Antero to $10,000 per violation except in certain circumstances. Current state legislation proposes raising the agency’s fines.

The Grants’ situation makes them wonder what other leaks might be lurking around the region. Garfield County has about 10,000 active wells.

“There’s so many pipelines out there,” Dan Grant said.