Federal officials offer new rules after pipeline spills highlight safety gaps

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BILLINGS, Montana — New federal rules proposed for pipelines that carry oil and other hazardous liquids could have prevented more than 200 accidents since 2010, including a Michigan rupture that ranks as the costliest onshore spill in U.S. history, federal officials said.

The U.S. Transportation Department proposal announced Thursday covers more than 200,000 miles of hazardous liquids pipelines that crisscross the nation — a network that expanded rapidly over the past decade as domestic oil production increased.

Included in the proposal are new inspection requirements for pipelines in rural areas; increased use of leak detection systems; and a requirement for companies to more closely analyze inspection results.

Left out were requirements for the industry to install more automatic or remote-controlled valves that can quickly shut down a line when spills occur.

Officials plan to address the valve issue separately, said Marie Therese Dominguez, chief of the Transportation Department's Pipeline and Hazardous Materials Safety Administration.

The delay was criticized by Rep. Lois Capps, D-Calif., whose district includes the Santa Barbara County coastline where a May rupture of a corroded pipe spilled 101,000 gallons of crude oil, some of which flowed into the ocean, formed a large slick and stained beaches.

"Federally regulated oil and gas pipelines currently are not required to use the best automatic shut-off technologies available and that needs to change," Capps said in a statement.

A 2011 pipeline law passed by Congress included requirements for remote-controlled and automatic emergency valves that can quickly shut down the flow of oil. Advocates say such valves are a simple way to limit damage from accidents.

However, the American Petroleum Institute has said retrofitting lines with remote-controlled valves could cost up to $1.5 million per device.

The federal agency also would make companies re-check lines following floods and hurricanes, and submit information about leaks and other problems on thousands of miles of smaller lines that fall outside of existing regulations.

The rules have been in the works since 2010, when 840,000 gallons of crude oil spilled into the Kalamazoo River in Michigan and other waterways from a ruptured line operated by Enbridge Inc. of Calgary, Canada.

Other pipeline ruptures have fouled waterways in Montana, California and elsewhere with crude oil and other petroleum products.

If the proposed changes had been in place, they could have prevented the Michigan spill and 238 other accidents between 2010 and 2014, transportation officials said. The other accidents released a total of more than 10 million gallons of oil, gasoline and related products and resulted in $118 million in costs and damages.

Investigators with the National Transportation Safety Board cited corrosion and a crack in the line as the probable cause in the Michigan spill, and blamed the accident in large part on ineffective oversight and weak regulation from the pipeline safety administration.

The leak went undetected for 17 hours, and cleanup costs for the spill exceeded $1 billion, making it the costliest onshore oil spill ever in the U.S., NTSB Chairman Christopher Hart said this week in testimony before Congress.

The proposed rules also expand requirements for leak detection systems to include new, regulated pipelines. Current rules cover only lines in areas with a large population or environmentally sensitive features such as drinking water supplies.

John Stoody, vice president of the Association of Oil Pipe Lines, an industry group, said much of the proposal involves work that companies already do voluntarily, such as periodic inspections of lines in rural areas.

Yet by imposing requirements for those lines, federal officials risk diverting attention from high-consequence areas with large populations or environmental features, Stoody said.

The federal proposal was characterized as an incremental step forward by the head of the Pipeline Safety Trust, a Bellingham, Washington-based advocacy group.

"We're disappointed that it took five years and we don't' think it's as significant as (federal officials) tried to portray it," trust executive director Carl Weimer said.

Dominguez hopes to finalize the rules sometime next year.

The changes could cost pipeline companies a combined $22.5 million annually, according to her agency.

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