Obama seeks tougher pipeline oversight

WASHINGTON -- The Obama administration called for tighter federal oversight of oil and gas pipelines Wednesday in the wake of a deadly California gas explosion that raised alarms about the safety of the nation's aging infrastructure.

In the meantime, the head of the National Transportation Safety Board said the federal agency responsible for the regulation is too accepting of assurances from industry that its equipment and practices are safe.

Hersman's comments echoed what safety advocates have long called for -- a pipeline agency that needs to be less cozy with industry and staffed with more inspectors to enforce stricter regulations.

They welcomed the Obama plan but said it fell far short of addressing the problems facing the nation's millions of miles of pipeline.

"It's the low-hanging fruit," said Rick Kessler with The Pipeline Safety Trust, a Bellingham, Wash., advocacy group. "There's no increase in mileage of pipelines that must be inspected, there's no standards for technology for inspections or repairing pipelines."

"If this is a starting point, fine. If this is all the administration has to say, it is wholly inadequate," he said.

The U.S. Pipeline and Hazardous Material Safety Administration is directly responsible for inspecting interstate pipelines, and has only 100 inspectors to do it. Oversight of intrastate lines is left to local regulators, who have in most cases left the inspections to utilities.

Hersman said the NTSB, which is investigating the California blast and two other pipeline accidents, is concerned that PHMSA relies too heavily on documents submitted by the companies it regulates, rather than its own on site verification of practices and procedures.

"We want PHMSA to be on the ground doing the inspections," Hersman said. "We think it's PHMSA's responsibility to trust but verify."

Federal investigators said they were examining whether Pacific Gas & Electric workers followed proper emergency procedures after a gas transmission line exploded into an inferno that killed at least four people and destroyed nearly 40 homes in a San Francisco suburb.

PG&E has said the pipeline, built in 1956, had to be shut down manually because it was not equipped with automatic shut-off valves.

The pipeline administration is the latest agency that lawmakers and safety advocates say have become so close to an industry it regulates that it has lost sight of the safety mission.

Two years ago, Congress held extensive hearings on reports by Federal Aviation Administration whistle-blowers who said inspectors were allowing airlines to fly passengers on planes without complying with safety directives.

Two scathing federal inspector general reports on the Minerals Management Service highlighted drug use and sex among drilling agency employees and industry executives during the George W. Bush administration. It also said drilling regulators had accepted gifts and trips from oil and gas companies and negotiated to go work for the industry while overseeing it.

The Obama administration plan sent to Congress would increase from $1 million to $2.5 million the maximum fine for the most serious violations involving deaths, injuries or major environmental harm related to oil and gas pipelines.

It also would pay for an additional 40 inspectors and safety regulators over the next four years.

Yet progress toward tough new laws is unlikely any time soon with Congress in election-year gridlock. Some earlier proposals to improve pipeline safety have languished on Capitol Hill over concerns by energy companies.

The White House proposal follows several accidents, including an oil spill from a pipeline owned by a Canadian company near Marshall, Mich., that sent an estimated 820,000 to 1 million gallons spewing into the Kalamazoo River in late July. Another spill from a pipeline by the same company, Enbridge Inc., was reported within the last week in suburban Chicago.

Transportation Secretary Ray LaHood said the DOT "needs stronger authority to ensure the continued safety and reliability of our nation's pipeline network."

PHMSA, which regulates the transportation of hazardous materials, falls under LaHood's responsibility as part of the Transportation Department.

PHMSA employees told lawmakers last year that during the Bush administration the agency was effectively run by a handful of lobbyists.

"When the (Obama) administration took office, PHMSA was a disaster of its own -- it's been that way for some time," said Rep. James Oberstar, D-Minn., chairman of the House Transportation and Infrastructure Committee, which held a hearing Wednesday on the Michigan oil spill.

Congress is expected to recess for midterm elections within the next three weeks, making it unlikely a bill could be enacted within the next two months. Oberstar said he wants the proposal at least approved by the pipeline subcommittee by then.

"I do think there is urgency," Oberstar said.

Deputy Transportation Secretary John Porcari told the committee he would have liked more time to craft the legislative proposal but wanted to get something to lawmakers as soon as possible.

The department's proposal would eliminate exemptions from safety regulations for pipelines that gather hazardous liquids upstream of transmission pipelines, DOT said.

It also would authorize PHMSA to collect additional data on pipelines, including information on previously unregulated lines, the department said. And it would provide for improved coordination with states and other agencies on inspector training and oversight of pipeline construction and expansion projects involving both gas and hazardous liquids pipelines.

There is no cost estimate yet for the proposals, Transportation Department spokesman Bill Mosely said.

Pipeline safety experts characterized the administration's proposal as a step in the right direction -- but maybe not enough.

"It's good to give them an extra club if they use it," said pipeline engineer Richard Kuprewicz, whose company, Accufacts Inc., offers pipeline safety consultations to communities.

"They may issue a half-million dollar fine, but there's an appeal process and in the end it can be a real small number," he said.

The department is also crafting new regulations to enhance pipeline safety, including requiring emergency flow restricting devices on some pipelines and changing the distance between valves, Porcari said. The regulations would be separate from the legislative proposal.

The department is also considering extending "high consequence area" designations to additional stretches of pipeline, Porcari told the committee. Regulations put in place after several gas pipeline accidents a decade ago require oil and gas companies to inspect the integrity of pipelines in densely populated areas. Those inspections, which are conducted by the companies themselves, began in 2002 and are supposed to be completed by 2012.

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Associated Press writers Matthew Brown in Billings, Mont., and Matthew Daly in Washington contributed to this report.

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Online:

National Transportation Safety Board www.ntsb.gov

House Transportation and Infrastructure Committeee http://house.transportation.gov

Department of Transportation