COMPARATIVE SPILLS CHART

 

Testimony of Robert B. Rackleff, President, Friends of Lloyd
before the Subcommittee on Investigations and Oversight, U.S. House Committee on Public Works and Transportation Hearing on Colonial Pipeline Spill of March 28, 1993
Washington, D.C., May 18, 1993

 

I am Robert B. Rackleff, President Of the Friends of Lloyd, a group of North Florida citizens organized to protect the environmental quality of our community and surrounding area. Lloyd is an unincorporated village in Jefferson County, l6 miles east of Tallahassee. Our mailing address in 8l6 Cherry Street, Tallahassee, Florida 32303, phone 904-222-97B9.

Our primary concern for over four years has been to stop construction of a Texaco gasoline tank farm and Colonial Pipeline project in the country's only high-recharge area for the Floridian Aquifer. 8ut a more general concern has become inadequate federal and state regulation of petroleum pipelines. There can be no doubt that much stronger federal and state regulation is necessary, and that is why we are submitting this testimony.

By way of introduction, I work as a self-employed writer and Consultant for such clients as the Polaroid Corporation, American Bar Association, Time Warner Inc., and Ford Foundation. Before that, I was a speechwriter for U.S. Senator Edmund Muskie, President Jimmy Carter, and Time Inc. Chairman J. Richard Munro.

My involvement in environmental issues began in the late 1960's and includes authorship of Close to Crisis: Florida's Environmental Problems (New Issue Press, l972). As President of the Friends of Lloyd, I receive no compensation of any sort; my involvement is voluntary and unpaid.

INTRODUCTION

I appear today to describe the extent of the problem of pollution from hazardous liquid, or oil pipelines in America, as exemplified by the Colonial Pipeline spill on March 28 near Reston, Virginia. The estimated 406,000 gallons of fuel which spilled into Sugarland Run and the Potomac River were only part of the more than 1.5 million gallons Colonial has spilled or leaked in the last four years. In fact, in 1991 and 1992, Colonial Pipeline alone spilled more than did all tankshlps and barges throughout the United States in those two years. Colonial spilled 566,496 gallons, and all water carriers spilled 529,693, in those two years.

And Colonial Pipeline's record is only a small part of the total spilled or leaked by an industry which is so lightly regulated that it is, for all practical purposes, self-regulated. Oil pipelines spill or leak the equivalent of an Exxon Valdez spill every year in America, on average, year after year. From 1970 to 1992, oil pipelines spilled a total of 272,036 562 gallons of crude oil and petroleum products, or an annual average of 11,827,242 gallons, according to the Annual Reports of Pipeline Safety of the U.S. Office of Pipeline Safety. In the six weeks after the Sugarland Run spill, from March 28 to May 10, the OPS have received telephone reports of 280 pipeline spills. One of them, by ARCO Four Corners Pipeline Company, spilled 260,400 gallons in the Los Angeles area.

Pipelines are the leading point source of oil pollution in the United States. The annual average of nearly 12 million gallons spilled are only those reported to the OPS. The actual volume of oil spilled each year by pipelines is undoubtedly far higher and "may be as much as 20 million to 30 million gallons each year," according to a report issued yesterday by the Friends of the Earth. I mention "point source," because urban runoff, or "nonpoint source" pollution, is the leading overall cause of oil pollution.

Spills from oil tankshlps and barges are far less serious a source of oil pollution than pipelines. In the years 1973 to 1992, tankships and barges spilled a total of 92,340,884 gallons of crude oil and petroleum products, according to the U.S. Coast Guard. We have no authoritative data on the annual volume of leaks and spills from aboveground and underground storage tanks.

Moreover, as a means of transporting oil, pipelines are twice as likely as tankers and barges to spill or leak. Factoring in statistics on ton-miles compiled by the Association of oil Pipelines, pipelines have spilled 20,928 gallons of oil per ton-mile transported, and tankshlps and barges have spilled 9,947 gallons per ton-mile transported. That is an important comparison because public concern and our regulatory effort in recent years has centered on preventing oil spills by tankships and barges.

(See page 21 for a table showing yearly spill totals for oil pipelines and water carriers in the United States.)

As only one indication of regulatory neglect, in contrast with the massive volumes spilled by pipelines, consider that the total amount of civil penalties collected from pipeline companies by OPS was $429,300 from 1979 to 1991. It does not include penalties collected in 1986; they wore not available to me. During those 12 years (excluding 1986), there were 2,437 reported pipeline incidents which spilled 126,000 gallons of oil, yet the OPS collected only $429,300 in civil penalties. That amounts to penalties paid of 3.4 cents per gallon spilled -- surely one of the great regulatory bargains of all time.

Pipeline pollution is an environmental crisis that persists because we have simply not taken it seriously as an environmental threat. Until passage of amendments to the Hazardous Liquid Pipeline Safety Act by Congress last year, federal regulations were concerned only with safety problems and not the environmental disasters they are. "The U.S. pipeline industry has an excellent public safety record," a National Transportation Safety Award (NTSB) official stated at a congressional hearing two years ago. It was as if DOT officials in 1989 had claimed that the Exxon Valdez disaster was a triumph of public safety regulation because, after all, nobody was killed or injured -then done nothing to prevent similar tanker spills.

The pollution of Sugarland Run and the Potomac River by Colonial Pipeline on March 28, despite its tragic impact, may at least have the effect of focusing Congressional attention on this long-neglected problem. I hope that a momentum will come out of this hearing for a thorough assessment or how poorly we regulate oil pipelines and a significant strengthening of these regulations.

I submitted written testimony in 1991 and closely followed Congressional action on the reauthorization of the pipeline Safety Act enacted last October. The amendments in that reauthorization made only marginal improvements in federal regulation of oil pipelines. It was one more opportunity lost for a significant advance in environmental protection and public safety.

Today, however, Congress again has an opportunity to develop stricter standards for location, construction, operation and regulation of hazardous liquid pipelines, as well as a stronger role for state governments and citizen access, to the courts. I hope that Congress makes the most of that opportunity.

LESSONS LEARNED ABOUT PIPELINE SAFETY AND POLLUTION

I want now to share some lessons the Friends of Lloyd have learned in the last four years of research about and direct experience with oil pipelines.

Our experience in opposing an ill-conceived gasoline pipeline proposal by Colonial Pipeline Company is as case study of how government pipeline regulations are not protecting the environment and public safety at the local level. It has also given us an opportunity to learn about the problem nationwide. In a sense, we have learned at the retail level what results from your work at the wholesale level, and we believe the lessons learned here are worth considering while you consider further actions after this hearing concludes. The most basic lesson we have learned is the government regulation is not working.

Colonial has proposed extending a l2-inch pipeline which now terminates in Bainbridge, Georgia, 55 miles to Lloyd, Florida, to serve a proposed gasoline tank farm in Lloyd, Florida, to be built by a partnership of Texaco, Cargo and Amoco. It would traverse high-recharge areas of the Florida Aquifer, including a lake, wetlands and sinkhole-prone areas, jeopardizing groundwater supplies of three counties In Georgia and two in North Florida. The projects are still unbuilt because of the opposition of the Friends of Lloyd and the Leon County government

We endeavored throughout to base our opposition on documented evidence of those safety and environmental records of petroleum pipelines and related facilities. We have carried out extensive research of public records, research literature, and pretrial discovery, as well as consulting with numerous scientific and engineering experts.

We also approached the widest possible range of federal, state and local agencies to seek relocation of the pipeline and tank farm. We found that these public agencies were neither willing nor able to help. We have had to rely primarily on privately financed lawsuits to challenge the project. While we have been able to bear these expenses, they are far out of the financial range of most community groups. Nobody should have to go through the strenuous efforts we have undertaken, yet this will happen again repeatedly unless regulators exercise more responsibility.

 

Here are some lessons we want to share with this subcommittee.

LESSON #1 - FEDERAL REGULATORY AGENCIES ARE NOT PROTECTING THE PUBLIC OR THE ENVIRONMENT.

Results should count, and the results demonstrate that the Office of Pipeline Safety is not serious about regulating pipelines. A record of 272 million gallons spilled in the last 23 years speaks for itself: the current regulatory structure is "broke," and it needs fixing.

General Accounting Office reports in the 1984, 1989, and 1991 and Congressional hardships in 1987 and 1989 have detailed the shortcomings of the Department of Transportation agencies regulating petroleum pipelines.

Among our many concerns about the numerous shortcomings is the inadequate staffing of the OPS and the National Transportation Safety Board. The OPS now has three field inspectors for the eight states, including nine in its Southeastern region -- and only 24 for a national pipeline system of 1.75 million miles (including 225,000 miles of hazardous liquids pipelines). We understand that the 1992 amendments will increase this number, but even that would be inadequate.

Inadequate staffing affects the full range of OPS activities, from data collection, verification and compilation to inspections. As an OPS official said in the 1989 hearing, "Essentially, our inspections consist primarily of reviewing their operating records and their operation and maintenance manuals, and spot-checking pipelines in the field. . . As you know, we have a very small program. . . It is a constant balancing act as far as how you deploy very limited resources."

Inadequate staffing also affects DOT's ability to investigate pipeline accidents, a responsibility of the NTSB. In the l987 Congressional hearing a NTSB official reported it had only two pipeline accident investigators. "Of the approximately 2,000 accidents reported to the Department of Transportation, the Safety Board is able to investigate 25 to 30," the official stated.

The result is that the public and environment are inadequately protected. Remember also that, in 49 states, including Florida and Virginia, there is no state regulation of petroleum pipelines. These 40 states rely entirely on the federal program to protect them from pipeline leaks, spills and explosions.

Also, pipeline companies assert the right to route new petroleum pipelines without meaningful restrictions by federal or state governments. There is no federal routing process for oil pipelines. The result is that pipeline companies routinely ignore environmental or safety considerations in routing new pipelines and in siting related facilities, such as gasoline tanks farms -- even when the dangers are obvious.

LESSON #2 - PIPELINE TECHNOLOGY AND OPERATING PRACTICES DO NOT PROTECT THE ENVIRONMENT

"Liquid petroleum pipelines are the safest mode of transportation in the United states," Joe Swift, president of Sun Pipeline Company, told the Sharp subcommittee on May 22. Yet, the pipeline record of 272 million gallons of oil spills alone is a repudiation of claims like this and an indictment of pipeline operations in the United States. Other reports confirm the enormity of the pipeline problem. For example, the General Accounting Office (GAO) in its January 29, 1991, report, "Pollution From Pipelines," documented 3,910 spills in U.S. waters during the 1980's, more than one per day.

The Wilderness Society report, "A Hundred Spills, A Thousand Excuses," released on March 19, 1990 underscored this serious failure and suggests a comparison of pipeline with other sources of oil pollution. From this report of the 100 worst spills following the Exxon Valdez disaster, we found this break down:

46 spills	Pipelines
16 spills	Storage Tanks
13 spills	Barges
10 spills	Tanker Trucks
9 spills	Tanker ships
3 spills	other ships
2 spills	Railroad Tankers
1 spill	Unknown

 

The Wilderness Society report showed that pipelines accounted for more than half of the total volume of the 100 worst spills. Here they are by category:

5,596,650 gallons (51.6%)	Pipelines
2,890,300 gallons (27.4%)	Storage Tanks
1,198,800 gallons (11.0%)	Tanker Ships
260,100 gallons (2.4%)	Barges
260,100 gallons (2.4%)	Other ships
82, 500 gallons (0.8%)	Tanker Trucks
25,500 gallons (0.2%)	Railroad Tankers
25, 000 gallons (0.2%)	unknown
10,851,650 gallons	Total

 

The Friends of Earth report on oil pollution, "Crude Awakening," released yesterday, compiled from news reports a list of 30 oil pipeline spills of over 100,000 gallons from 1985 until the March 28 Sugarland Run spill by Colonial Pipeline. A report in Oil and Gas Journal of October 29, 1990, found 690 failures in Gulf of Mexico offshore oil pipelines from 1967 to 1987 and that the rate of failures was getting worse, not getting better. The report concluded, "The significant increase in failures since 1975 can be attributed to the increase in the pipeline population, aging of the pipeline installed earlier, and the increased offshore construction activity."

These and other reports demonstrate that petroleum pipelines are far more dangerous and unreliable than both the industry and regulators claim. Moreover, we should never lose sight of the fact that pipeline spills tend to happen inland, and pollute the ground and waters we depend on for municipal and agricultural water supplies. Unlike coastal waters, where tides and other flushing action can disperse contamination (although the ecological effects can be devastating), inland spills from pipelines can produce groundwater contamination that persists for decades and may never be completely cleaned up.

For example, a leak in an eight-inch pipe in East Setauket, Long Island, dribbled a million gallons of leaded gasoline into the ground for over 10 years. The underground pool of gasoline still floats over the Long Island Aquifer, the island's only source of drinking water. Besides pumping out undissolved gasoline, cleanup effects include a now wastewater treatment plant, large enough for a city of 35,000 people, to treat the ground water containing dissolved gasoline. Officials there expect the cleanup to take at least a decade.

LESSON #3 - SPILL AND ACCIDENT DATA ABOUT PETROLEUM PIPELINES ARE INCOMPLETE, INACCURATE AND NEEDLESSLY DIFFICULT TO OBTAIN.

Despite reports Of 32.9 million gallons of petroleum spilled in 1987-89, the OPS data serious underreport the number and dimension of pipeline spills. As a result, the data are deeply flawed as a basis for policy development or source of public information. For example, there is no way of knowing whether a pipeline operator's good record at OPS is genuine or a result of underreporting the volume of spills or not reporting them at all.

This is partly because the OPS in 1984 inexplicably relaxed its reporting requirements so that it now requires hazardous liquids pipeline operators to report spills or leaks of more than 2,100 gallons (50 barrels), or involve $5,000 or more in property damage or injury or death; the previous requirement was to report all spills over 210 gallons (five barrels).

As a result, the average number of liquid pipeline spills reported to OPS was fewer than half the 391 annual average spills compiled from other sources by the GAO. Note also that the GAO reported on spills in U.S. waters only, while the OPS data were supposed to reflect spills inland as well.

Moreover, the GAO reported in 1987 that few pipeline companies complied fully with even the relaxed OPS reporting requirements and that the OPS was unable to monitor compliance with reporting requirements. The GAO was unable to determine the full extent of this underreporting. Other problems, as noted in 1990 by an OPS official in conversation with me, are pipeline companies which underreport the size of spills, and failure to revise reported spill volume upward after their initial report.

As one test of OPS data accuracy, we compared the number of reported spills at OPS with known data about a crude oil pipeline which traverses the Florida Everglades. The Florida Department of Natural Resources has on file approximately 40 spills by Sunniland Pipeline; the OPS have two on file.

The only other source of systematic spill data, the Emergency Response Notification System (ERNS), comes from reports to the U.S. Coast Guard National Response Center on spills in U.S. waters, and does not include inland pipeline spills. Although it shows about twice the number of spills as OPS data, it seriously undercounts the volume of these spills. For the years 1980 to 1989, ERNS reports that oil pipelines spill almost 20 million gallons, while OPS data reported spills of 109,543,640 gallons during the same period. More recently, Coast Guard data on the Sugarland Run spills records the volume spilled as zero.

In short, the inadequate data on pipeline spills are a serious shortcoming which distort the safety and environmental record of petroleum pipelines and thereby impair objective analyses of risks and the development of policies to reduce those risks.

 

LESSON #4 - PIPELINE COMPANIES ROUTINELY MISREPRESENT THEIR SAFETY RECORDS AND FEDERAL REGULATIONS, WHICH GOVERN THEM

Even compared to the undercount of spills and accidents in OPS records, Colonial Pipeline has misrepresented both its company record and the industry record of spills and leaks. It has repeatedly told North Florida residents that pipelines cause less pollution than other means of transporting oil, especially tankers and barges. In a newsletter published last year, Colonial claimed that data from the U.S. Department of Transportation showed that in 1990 pipelines spilled 18,709 gallons per billion ton-mile transported while water carriers spilled 44,458 gallons per billion ton-mile. The same statistics were in a Florida Energy Pipeline Association (FEPA) newsletter.

When we asked DOT about these statistics, we heard from George W. Tenley Jr., Associate Administrator for Pipeline Safety:

We looked at Colonial's data more closely and determined that they came from the Emergency Response Notification System, which counted less than 20 percent of the volume of oil pipeline spills in the 1980's, as I cited earlier, and ignored the more accurate OPS data. Moreover, in an application for a dredge-and fill permit in 1990, the Florida Department Of Environmental Regulation asked Colonial Pipeline how many spills it had experienced; its answer was two. Also, Colonial Pipeline has repeatedly stated that its few spills were the result of "outside force," when the actual causes of most were equipment failures or employee error. As OPS data show, "outside force" typically accounts for about one-fourth of liquid pipeline accidents, while pipeline companies' equipment or operational failures account for three-fourths.

Colonial Pipeline has also misrepresented the nature of federal regulations in a concerted effort to forestall state or local governments from regulating petroleum pipelines here. When the Friends of Lloyd lobbied the Florida Legislature in 1990 to enact a state program to regulate hazardous liquid pipelines, pipeline lobbyists repeatedly claimed that "federal preemption" made such state legislation illegal, despite OPS efforts to encourage state involvement in regulating pipeline safety. As recently as May 16, 1991, a Colonial attorney told the Tallahassee Democrat, "Federal law says no state -- and the county is part of the state -- shall adopt any standards related to the safety of pipelines."

In fact, the federal government encourages states to enact pipeline regulation. As a senior U.S. Department of Transportation official said at a 1989 Congressional hearing, "The state programs are critical to pipeline safety. Existing Federal resources, and any reasonably likely expansion of those resources, are not sufficient to ensure the safe operation of pipeline facilities given the size of the regulated community, the extent of their facilities, and the complexity of their operations. Moreover, states have a strong interest in protecting their citizens."

One obvious, but overlooked result of pipeline company misrepresentation is that only 10 of the 50 states are certified to participate in the regulation of pipelines. If our experience during the 1990 Florida legislative session is a guide, the zeal of pipeline companies to prevent state regulation of pipelines has ensured that the OPS program with state regulators will not expand in coming years. The apparent reason for opposing state regulations is that pipeline companies have grown comfortable with federal regulators and do not want this relationship disturbed.

For another example, Colonial Pipeline attempted two years ago to stop a local government in Florida from determining the route of a new pipeline within its jurisdiction. It filed a lawsuit in federal court on August 16, 1991 against Leon County, claiming that federal law preempts the county's action, despite federal policy that leaves such determinations to state and local governments. Yet only weeks earlier, DOT's Administrator of the Research and Special Programs Administration, Travis P. Dungan, told a Congressional subcommittee that "such matters as zoning and location of pipelines are entirely a matter of local control." Even the Association of Oil Pipe Lines has endorsed "the power of state and local governments to affect the location of pipelines that cross their jurisdiction," in a written statement on June 20, 1991. A federal judge in February, 1992, ruled against Colonial.

Colonial has also misrepresented federal safety regulations about the clear-cutting of pipeline rights of way. A group of homeowners in the Atlanta Georgia area have filed a lawsuit in state court to stop Colonial from clear-cutting trees adjacent to their homes. In reply, Colonial and Plantation Pipeline submitted a legal brief on June 28, 1990 that they had no alternative but to clear-cut because "The pipeline companies must clear the right of way and any obscuring side growth to comply with the inspection requirements of Part 195.412(a) [of DOT pipeline regulations]." However, that requirement states simply that operators inspect rights of way at specified intervals and nothing about methods of clear-cutting.

The March 28 spill by Colonial Pipeline is another example of how Colonial misrepresents itself. When the spill took place, Colonial claimed that it lost 336,000 gallons; it had the look of a precise number, but it was exactly 8,000 barrels, and later turned out to be about 406,000 gallons. In a newspaper ad run in the Tallahassee area, Colonial Pipeline claimed, "Almost all of the product spilled in Virginia was recovered -- a phenomenal recovery effort." Yet Congressional staff found that Colonial has wildly exaggerated the volume or fuel it recovered, counting the volume oil-tainted water it recovered as pure oil when it recovered barely half of the oil spilled. Colonial also claims that outside damage scarred the pipeline and thereby caused the spill, when it is more likely that sloppy construction by Colonial's contractor installing the pipeline was the cause.

In short, if Colonial Pipeline's lack of veracity is any guide, pipeline companies routinely mislead state and local officials, as well as the general public. This will persist as long as federal policy continues to be obscure and data continues to be faulty and inaccessible to the public.

LESSON #5 - THE CURRENT RELATIONSHIP OF THE REGULATED INDUSTRY AND REGULATORS MAKES SIGNIFICANT REFORM IMPOSSIBLE.

As important as inadequate funding and staffing have been as causes of inadequate regulation of pipelines by DOT, these alone cannot explain the history of consistently pro-industry actions by the regulatory agencies involved, primarily the Office of Pipeline Safety.

We do not impugn their integrity or dedication, but we found unmistakably pro-industry behavior of DOT staffs and leadership during the Presidency of Ronald Reagan and George Bush. The 1984 relaxation of the petroleum pipeline spill reporting requirements is a notable example of a decision that could only benefit pipeline operators, to the detriment of the public and environment.

Less than six months ago, the OPS in the Federal Regulator of November 27, 1992, proposed relaxing its spill reporting requirements so that pipeline companies would no longer have to raise the threshold from $5,000 of property damage to $50,000. The stated reason for this change was that the American Petroleum Institute the $5,000 requirement was "outdated, unnecessarily burdensome and results in unnecessary costs and red tape." The OPS agreed that "the requirement sometimes requires reporting of minor accidents." This would have further reduced the effectiveness of an already-inadequate reporting system and ignored the need for accurate data to understand the pollution problem better.

We also note the pro-industry membership of the OPS's Technical Pipeline Safety Standards Committees, which exert a powerful influence on regulatory decisions. The most recent list of members of the two committees shows a membership comprised of industry, government and public representatives, each in equal number. However, the "public" members consisted of lawyers and consultants whose livelihood depends on pipeline companies. With such a membership, the real public and real public interests are invisible and unrepresented.

There is no better confirmation of this pro-industry bias than the OPS disposition of proposed improvements in hazardous liquid pipeline regulations, as reported in the Federal Register of June 8, 1990, pages 23514-19. The OPS considered 18 proposals, beginning in February, 1987, including proposals by a DOT Safety Task Force and the National Transportation Safety Board, and requirements in the Pipeline Safety Reauthorization Act of 1988.

After three years, the OPS in 1990 had taken final action on only two of the 18 proposals, adoption of the one-call system and the inclusion of carbon dioxide pipelines in its regulatory program. The OPS decided either to study further, to modify severely or to reject outright the 16 other proposals, erring in all cases on a lighter regulatory burden on the pipeline industry. The recommendations of the technical committees determined the OPS outcomes in most of these cases.

The OPS put off for study, proposals requiring such technical improvements as automatic shut-off valves, hydrostatic testing, lower maximum operating pressures and computer-based leak detection, and rejected proposals requiring cathodic protection and double-wall pipe. It put off for study such procedural improvements as requiring operators to inventory types of pipelines and systems and to submit reports on pipeline condition every four years, and rejected proposals for operators to provide information to local governments, to inform local residents of pipeline location, to install more conspicuous line markers, and to develop setback requirements.

However, in most cases where the OPS intends to study these proposals, the results are foreordained to err on the behalf of pipeline companies' interests. For example, in considering the NTSB recommendation to require automatic shutoff valves, which might have reduced the size of the Sugarland Run spill, the OPS stated, "there does not appear to be sufficient jurisdiction to require the installation. . . along the entire length," but it would carry out a study as required by the 1988 Reauthorization Act; the results of which are predictable. The 1988 Reauthorization Act required the OPS to study hydrostatic testing of pipelines, yet the forthcoming results are also predictable, given the OPS statement that "integrity testing of all pipelines at arbitrary, fixed intervals, does not appear justified."

A review of the disposition of each proposal shows a consistent deference to industry claims that both technical and procedural improvements would be unnecessary financial burdens -- and a general satisfaction of OPS with current procedural and technical standards. In considering increased federal oversight in design and construction of new pipelines, the OPS stated, "The available safety data do not indicate that the actions contemplated by this proposal for design and construction functions are needed." However, it did agree to establish competency standards for pipeline company personnel, position consistent with companies' tendency to blame problems on human error, and not equipment or operating procedure problems.

Of special concern to us is the consistently low regard by OPS for informing the public or local governments. The OPS deferred to pipeline company claims about the high cost of requiring them to provide local governments with information about pipeline locations and descriptions; it decided instead that states should have that responsibility. It deferred to company complaints that informing residents near pipelines about locations would "create undue alarm, that landowners are not necessarily the persons at risk, and that the costs would be extremely high with little expected benefit"; the OPS rejected this proposal. It also rejected more conspicuous pipeline markers at road crossings "without regard for esthetic considerations." In other words, the OPS has little regard for informing the public, despite the public's right to know and the obvious value in a better-informed public and local governments.

The 1987 Congressional hearing on pipeline safety, in the wake of the Mounds View, Minnesota, disaster provides another example of OPS deference to industry interests. During that hearing, GAO commented on OPS's "study" of the feasibility of regulating pipeline-connected petroleum tank farms, a measure GAO had recommended in 1984. The OPS study found that such regulations were not necessary because, it claimed, unregulated tank farms had safety records comparable to similar regulated ones. However, GAO reviewed crucial data in this study and found that OPS had selected data only from operators with the best safety records, ignoring more representative data, which would have demonstrated an urgent need for regulation. Once again, OPS had acted to the benefit of the pipeline industry, not the public.

ln short, it is clear that continued reliance on the Office of Pipeline Safety by congress to improve technical and procedural standards, short of mandating specific standards, will produce only marginal improvements far short of the urgent need to improve the pipeline safety and environmental record. The industry has far too much influence, especially through the technical advisory committees, for OPS to carry out impartial studies that will lead to the significant improvements.

LESSON #6 -- FEDERAL REGULATIONS DO NOT, BUT SHOULD, COVER PIPLEINE-CONNECTED PETROLEUM TANK FARMS.

Despite recommendations by GAO in 1984 that the Department of Transportation study the feasibility of regulating plpeline-connected petroleum tank farms, DOT took no action. As a result, a large number of inland tank farms continue to have safety and pollution records, which should concern us all. As the GAO found in 1989, federal tank farm regulations "do not contain mandatory, specific design and operating practices to avoid spills."

That lack of federal regulation helped lead to such tragedies as the massive tank farm leaks in Fairfax, Virginia, which was investigated by a commission formed by Governor Doug Wilder. In its report of December 18, 1992, it stated,

The Commission adheres to the position stated by the Attorney General of Virginia, the Fairfax City Council, the Fairfax County 8oard of Supervisors, the Council of Civic Associations of the City of Fairfax, the Fairfax County Federation of Citizens Associations, and citizens for a Healthy Fairfax, that the Pickett Road Tank Farm is inappropriate in its present location. poses an unreasonable risk to the surrounding public health, safety, and welfare, and must be relocated.

The report also noted:

During the first year of operation [1965], a spill of 2500 gallons was reported by Texaco. Over the next 27 years, at least 20 spills were reported by the various owners and operators, with a total spillage of at least 500,000 gallons of various products.

The Washington Post reported that the Virginia Attorney General was about to file criminal charge against Texaco, which avoided prosecution after agreeing to buy out homeowners in two neighborhood and otherwise compensate them in a settlement which may cost Texaco as much as $200 million.

Texaco in Travis County, Texas, recently closed down its tank farm in East Austin because it caused massive contamination and health problems. To avoid criminal prosecution -- just like in Virginia -- Texaco and several other oil companies had to close down their tank farms there permanently. The Austin American-Statesman reported on September 19, 1992,

"Facing the threat of criminal subpoenas from a five-month pollution investigation, a third oil company agreed Friday to close its gasoline terminal at East Austin's controversial tank farm.

Officials at Star Enterprise [Texaco], which operates the largest terminal at the tank farm, notified Travis County Attorney Ken Oden that they will halt all operations at their six-acre site as soon as the company finds a temporary alternate fuel supply.

. . . Friday's announcement came just days after Oden was to begin issuing grand Jury subpoenas to the oil companies that remain a focus of his investigation."

 

In 1991 the Environmental Protection Agency (EPA) ordered a Santa Fe Pacific Pipeline Co. fuel-tank farm near Reno, Nevada, to begin a cleanup of leaks that total no less than four million gallons and may be an large as 40 million gallons. This is a staggering amount of leaked fuel which may be migrating underground to the nearby Truckee River. If that occurs, it would contaminate irrigation canals and Pyramid Lake downstream.

Other examples include massive contamination at pipeline and storage tank complexes in Greensboro, N.C. and in Spartanburg, S.C. As reported in the Greensboro News and Record, state authorities have required a massive cleanup by Colonial Pipeline, Plantation Pipeline and eight oil companies in Spartanburg because resident complaints and teat wells showed widespread contamination of groundwater there. A state official "estimated that only about 5 percent of the cleanup is complete and that it will continue throughout the l990's," wrote the Greensboro newspaper on December 14, 1989.

In Greensboro, state officials found a massive underground pool of gasoline, five feet deep in one tent well, at a tank farm operated by Colonial Pipeline, Plantation Pipline and 16 oil companies. Discovered in 1988, it went unreported until November, 1989. Reported soon after was the discovery that Colonial Pipeline buried storage tank sludge in trenches on a farmer's field until 1980; the sludge included carcinogenic chemicals and heavy metals.

These illustrate the severe contamination that slow leaks can cause at tank farm sites which have scores of storage tanks and mazes of underground pipelines, any one of which can be the source of major problems. As a report issued in February by the Environmental Defense Fund stated,

"At refineries and other facilities that store large quantities of petroleum in aboveground tanks, it is likely that more than half the facilities have large underground reservoirs of petroleum, which can migrate offsite if unaddressed."

 

Our experience in North Florida is further evidence of this regulatory need. Texaco and Colonial selected a site for the first of what will be several tank farms in a major complex in the only high-recharge area in Jefferson County. The site is bracketed by four sinkholes in an area known to be sinkhole-prone. Cave divers explored one of the sinkholes in November and December, 1990 and discovered that it was part of a major underground water system which surfaces nine miles away to form one of Florida's last unspoiled rivers. We have edited footage of this historic dive into a 12-minute video which we can provide to this subcommittee.

Also, the proposed Texaco and Colonial tank farm in Lloyd is in a community with no effective ability to monitor fire safety at the facility or to extinguish even minor fires. Jefferson County has only five paid firefighters for the entire county and no effective means to enforce fire safety or extinguish a fire. This is at a site less than 300 yards from Interstate Highway 10, surrounded by an area slated for intensive commercial and residential development.

In other words, as a result of this lack of federal (and lax state) regulations on pipeline-connected petroleum tank farms, Texaco and Colonial can site this major new facility in one of the worst possible locations you could imagine. If federal regulations are adequate today, why can oil companies make such irresponsible and dangerous decisions, without review by competent environmental authorities?

LESSON #7 - PETROLEUM PIPELINES CAN BE MUCH SAFER AND CLEANER, AND THE FEDERAL GOVERNMENT SHOULD TAKE THE LEAD, WHILE ALSO FULLY INVOLVING STATE REGULATORS.

Despite the self-satisfaction of the industry and federal regulators, it is painfully obvious that improved technology and operating standards can make petroleum pipelines much safer and cleaner than they are, or will be, if Congress continues to enact only marginal regulatory improvements. We propose later in this testimony several such standards which are far more promising than those this subcommittee is actively considering.

We are especially concerned that the Pipeline Safety Act excludes states at a time when effective regulation of pipelines calls for a federal and state partnership such as those formed in other areas of environmental regulation. It preempts any state safety regulation of interstate pipelines that exceeds Federal standards, but leaves open the possibility of state environmental regulations that are stricter than Federal standards which are necessary for protecting unique environmental conditions in that state. States like Florida or Virginia should be able to adopt additional standards to protect their environment, especially groundwater. Legislation should make clear that states can impose additional environmental standards.

We are also concerned that new pipelines incorporate improved technologies and operating procedures before major new pipelines are built. This is a special concern because Florida is on the verge of major expansion of petroleum pipelines in what the industry proclaims is the nation's third-largest gasoline market -- and because of Florida's unique dependence on groundwater supplies which are close to the surface; 90 percent of the water Floridians use come from underground aquifers.

Only two inter-urban pipelines exist in Florida today, a Sunniland Pipeline carrying crude oil from Collier County to Port Everglades, and a GATX gasoline pipeline from Tampa to Orlando. Plans are underway to change this, however, because of the proposed Colonial project in North Florida and another proposed GATX pipeline from Tampa to Fort Myers. The GATX project would extend 128 miles through some of Southwest Florida's most vulnerable waterways and wetlands.

In such a fragile environment, petroleum pipeline leaks and spills would have a devastating effect on water quality, with untold long-term effects on public health.

Much stricter federal regulations could be the most effective means of protecting the public or Florida and other states, but not the only means. The Friends of Lloyd and other environmental organizations are preparing a petition for rulemaking to the Florida Department of Enivironmental Regulation, to establish a state program though administrative procedures.

LESSON #8 - A NATIONAL STUDY BY AN UNBIASED AUTHORITY IS NEEDED TO DETERMINE THE PROBLEMS AND SOLUTIONS FOR PIPELINE POLLUTION

It is painfully obvious that pipelines are a far greater source of oil pollution than acknowledged by the industry, regulators, the public or even most environmental organizations. This is because current information and data about leaks and spills are fragmented, incomplete, and anecdotal. The uncoordinated compilation and organization of this information makes it impossible to determine accurately the relative dangers from different means of transporting fuels.

The foremost sources today are industry organizations, such as the American Petroleum Institute, and regulators like the DOT, which have no demonstrated ability to provide impartial information to policymakers. When the DOT commissioned a study of pipeline safety by the Transportation Research Board of National Research Council (Special Report 219, "Pipelines and Public Safety"), its narrow focus on safety ignored the enormous but unexamined problem of pipeline pollution. And as I round out in correspondence last year with the OPS, it had never studied the pollution record of pipelines, with the excuse, "we would have to undertake a significant amount of validation, analysis, and interpretation to arrive at any responsible conclusions."

The problem is so alarming that the Congress should ask for a comprehensive study by an organization with no stake in either existing regulatory policies or economic interests.

 

LESSON #9 -- THE PIPELINY SAYETY ACT COULD MORE ACCURATELY BE CALLED "THE PIPELINE INDUSTRY PROTECTION ACT"

Much of the Hazardous Liquid Pipeline Safety Act amounts to strong protection of oil pipeline companies from other federal agencies, state and local governments, and citizens. It protects companies from state and local governments by preempting them from regulating the safety of interstate pipelines, except land-use decisions. Section 2002(d) states,

". . . No state agency may adopt or continue in force any safety standards applicable to interstate pipeline facilities or the transportation of hazardous liquids associated with such facilities."

When a pipeline spill occurs, the Pipeline Safety Act protects companies by preventing state or local governments from taking meaningful actions to prevent further spills. The case of Williams Pipeline Co. v. City of Mounds View, Minnesota, affirmed that the city could not prevent the restarting of the damaged pipeline only days after it had exploded and killed several people. A 1992 amendment to the Act permits state and local governments to comment on settlements between the OPS and pipeline companies, but this is hardly meaningful.

Moreover, the Pipeline Safety Act protects pipeline companies from owners of property destroyed by pipeline spills or leaks. Section 2014(b) states,

"No civil action may be commenced [for injunctive relief] . . . if the [Office of Pipeline Safety] has commenced and is diligently pursuing administrative proceedings…"

It usually takes at least two years, and often more, for the OPS to complete these proceedings. As a result, virtually all owners of property destroyed by pipeline companies settle for pennies on the dollar, instead of waitlng years just to file a claim for damage in court.

 

SUGGESTIONS FOR FURTHER ACTION

We believe that adoption of the following suggestions can significantly improve the regulation of oil pipelines.

l. Encourage states to adopt pipeline regulatory programs allowing them to adopt environmental and safety standards which may be stricter than federal standards. It the 40 states without such programs adopted an oil pipeline regulator program, it would vastly increase the resources put to that task. States have shown little interest because of industry lobbying, as in Florida, out also because federal preemption discourages them. There are many states with unique environmental vulnerabilities which should be allowed to protect them from inadequate federal regulation. We suggest the following language:

2. Allow individuals to sue pipeline companies for civil penalties and damage to their property or selves as soon as the damage occurs. It makes little sense to insulate pipeline companies from lawsuits by individuals, and in fact, it would strengthen pipeline safety if companies were exposed to this liability. It would bring the Pipeline Safety Act into consistency with other federal environmental laws, such as the Resource Conservation and Recovery Act. Most important, individuals should be able to recover damages in full, not be forced to settle for only a fraction of the damages, as they do now.

3. Interested parties should have the right to intervene and participate in DOT administrative proceedings regarding violations, including spills leaks. State and local governments, environmental organizations and individuals have been frustrated for too long with their inability to participate in negotiated settlements between DOT and pipeline companies. This and the previous suggestion would help provide citizen enforcement of pipeline regulations, as is the case in other areas of environmental law.

4. Regulations should require pipelines companies to report all spills over one gallon, or produce a visible sheen on waters, or that result in injury or $100 in damage to company, private or public property. This would make petroleum pipeline incident reporting requirements consistent with requirements for other forms of petroleum transportation. This would help overcome the lack of credible incident data which has helped ensure a widespread complacency about pipeline safety and pollution and lax regulatory standards. It hinders the development of meaningful risk analysis. And it hinders the ability of the public to inform themselves about the true extent of pipeline safety and pollution incidents.

5. If DOT continues its weak response to new technical and operation standards, Congress should take up the task. It was only after Congress last year required the use of "smart pigs" that OPS took action. If this inaction continues, Congress must be more specific and forceful about technical standards.

For example, we believe that regulations should require double-wall pipe for hazardous liquid pipelines, with continuous leak detection, in environmentally sensitive and high-density population areas. Current detection devices cannot find small leaks that, over days and weeks, can contaminate groundwater with thousands of gallons of petroleum. Double-wall pipe can offer enhanced protection much the same as double-hull tankers, double-wall underground storage tanks, and secondary containment of aboveground storage tanks.

We believe the bill should also require enhanced technical standards for cathodic protection design, hydrostatic test facilitation, pipeline valves, acoustic leak detection test points, monitoring wells, and continuous leak monitoring pipeline math modeling systems.

For example, regulations should require hydrostatic testing of new pipelines at least every three years, and new pipelines should have the technical capabilities that make that possible. This is necessary because current leak detection methods cannot find small leaks which, over time, can release large amounts of petroleum into the ground. Visual surveillance can miss leaks which do not produce dead surface vegetation or other telltale signs, pressure gauge calibrations miss slight drops caused by small leaks, flow meters cannot correct for temperature changes which causes changes in volume, and "smart pigs" often miss faulty wells or other defects. Hydrostatic testing can detect leaks caused by smart pigs (which may, as they travel through pipes, dislodge scaling or other deposits which plugged existing leaks) and should be considered complimentary to pigs.

We are aware of many of the industry objections to such technical standards, and the negative response in l990 to similar proposals by the Technical Pipeline Safety Standard Committees and the office of Pipeline Safety, but it is precisely because of the combined resistance of the regulated industry and current regulators that pipeline pollution is such a serious problem. If the subcommittee staff does not have the expertise to evaluate technical standards, perhaps the Office of Technology Assessment could provide assistance.

6. Require that all members of the Technical Hazardous Liquid Pipeline Safety Standards Committee have no financial interests in the pipeline industry. The current requirement that only one public member have no financial interest is a pathetic mockery of the purpose of having one-third of the members of this committee represent the public interest. It means that the other three "public" members of the committee can continue to be lawyers, consultants and other individuals whose livelihoods depend on the pipeline industry. The four "public" committee members can represent the public only if they have no conflicts of interest, and there is no reason for them not to be conflict-free.

7. Federal regulations should include a process by which pipelines and related tank farms are sited. As we already do with interstate natural gas pipelines, we must recognize the crucial role that siting and routing decisions can have in minimizing environmental damage. Given the sorry record of leaks and spills by pipelines, new routes should avoid wetlands, sinkhole-prone, aquifer-recharge areas and other environmentally sensitive areas. There are no such federal regulations today.

8. Appropriations levels should provide increased staffing for OPS and related agencies to ensure that new levels reflect the urgent need for improved inspection, data collection and dissemination, and development of stringent new technical and operating standards.