- Associated Press - Thursday, October 1, 2015

BILLINGS, Mont. (AP) - U.S. officials said Thursday they want tighter safety rules for pipelines carrying crude oil, gasoline and other hazardous liquids after a series of ruptures that included the costliest onshore oil spill in the nation’s history in Michigan.

The U.S. Department of Transportation proposed expanding pipeline inspection requirements to include rural areas that are currently exempt and for companies to more closely analyze the results of their inspections.

The 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 proposal 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.

Pipeline ruptures in recent years have fouled waterways in Michigan, Montana, California, Virginia and elsewhere with crude oil and other petroleum products.

“This is a big step forward in terms of strengthening our regulations,” said Marie Therese Dominguez, chief of the Transportation Department’s Pipeline and Hazardous Materials Safety Administration. “It’s timely, and it’s raising the bar on safety.”

The new 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.

Investigators with the National Transportation Safety Board cited corrosion and a crack in the line as the probable cause, and blamed the accident in 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.

If the proposed changes had been in place, the requirements 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.

Also Thursday, federal officials announced a $2.6 million penalty against Exxon Mobil over a 2013 pipeline failure that spilled 133,000 gallons of crude in Mayflower, Arkansas.

It was unclear if the announced regulatory changes could have made a difference in that accident, which was blamed on defective pipe that worsened over time.

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.

By imposing requirements on the timing of maintenance, federal officials run the risk of diverting attention from high-consequence areas with large populations or environmental features, he said.

“That’s maintenance dollars that would not be spent on higher-priority areas,” Stoody said.

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

“There’s some good stuff in there,” trust executive director Carl Weimer said. “But we’re disappointed that it took five years and we don’t’ think it’s as significant as (federal officials) tried to portray it.”

Weimer pointed to the requirement to check lines after natural disasters, such as the flooding blamed in a 2011 Exxon Mobil pipeline rupture that spilled 63,000 gallons of crude oil into Montana’s Yellowstone River. Companies also should take steps ahead of time to guard against such occurrences, he said.

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

Dominguez said she hopes to finalize the rules sometime next year.

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.

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

Transportation officials plan to address the issue in a separate proposal.

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, 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.

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