[Docket No. PHMSA-2016-0016]
On December 19, 2016, PHMSA issued its Underground Natural Gas Storage (UGS) Interim Final Rule (IFR) regulations. The rules apply to all existing and newly constructed underground natural gas storage facilities including solution mined salt caverns, depleted reservoirs, and aquifer storage facilities. The IFR incorporates by reference two API RPs: (1) API RP 1170, “Design and Operation of Solution-mined Salt Caverns used for Natural Gas Storage,” issued in July 2015, and (2) API RP 1171, “Functional Integrity of Natural Gas Storage in Depleted Hydrocarbon Reservoirs and Aquifer Reservoirs,” issued in September 2015.
On January 18, 2017, the American Gas Association, API, American Public Gas Association, and the Interstate Natural Gas Association of America (collectively, the petitioners) submitted a petition seeking reconsideration of the IFR, insofar as it modified the non-mandatory nature of many of the recommendations in the RPs. The petitioners contended, among other things, that the implementation periods were impracticable and should reasonably be extended.
On June 20, 2017, PHMSA issued Notice related to the relief sought by the petitioners. First, PHMSA determined that it would be impracticable to respond to the petition for reconsideration within the 90 day timeframe consistent with their policy regarding any petition for reconsideration. PHMSA plans to leave the petition for reconsideration open and evaluate the petition, along with the comments it received during the development of a final rule. PHMSA plans on using the final rule to address the comments and the petition for reconsideration and revise the requirements detailed in the IFR accordingly. PHMSA expects to issue a final rule by January 2018.
Second, regarding the manner in which non-mandatory sections of the RPs were made mandatory in the IFR, the petitioners expressed concern that treating non-mandatory practices as mandatory could result in unnecessary burdens for operators. PHMSA received similar comments to those raised in the petition on this issue during the 60 day comment period immediately after the IFR was issued. PHMSA understands these concerns and is reviewing the treatment of non- mandatory provisions as mandatory and will respond to these points in a final rule which is expected to be issued in January 2018.
In the interim, PHMSA announced it will not issue any enforcement citations to operators for non- compliance with any non-mandatory provisions in the RPs until at least one year following publication of a final rule. Also, during this same period they will not issue enforcement citations to operators for non-compliance with the requirement to justify and document deviations from the non-mandatory provisions. PHMSA will, however, retain and enforce the other compliance deadlines in the IFR, including the requirement that operators of existing underground gas storage facilities develop, by January 18, 2018, policies and procedures to implement those sections of the RPs that are identified as mandatory in the actual RPs.
Finally, PHMSA noted that nothing in their latest Notice is intended to prevent or discourage any operator from carrying out any recommended practice that is non-mandatory in the RPs if the operator determines that the recommended practice needs to be followed to ensure the safe operation of its facilities.
For a copy of this UGS Petition for Reconsideration published in the Federal Register, contact Jessica Foley.