Shell's bid to build two new pipelines in Canada rejected

CALGARY, Alta. - In a rare move, Alberta's energy regulator has rejected Shell Canada's application for two new pipelines at the company's Waterton field site in southwestern Alberta.

But the Energy Resources Conservation Board ruled on March 9 that Shell Canada will be allowed to drill a new sour gas well in the area and add a fuel-gas compressor.

The board added that given the way that the company has operated its existing infrastructure in the area 20 kilometers west of Pincher Creek, it has not demonstrated that it has followed its own procedures.

In a hearing last fall that led to this decision, Shell acknowledged a sour gas leak in November 2007 eroded the trust of residents near the small community of Beaver Mines.

Several residents in the area were evacuated as a result of the release, and others were required to seek shelter in their homes.

On March 9, the board said it agrees "that the operational procedures and pipeline technologies proposed by Shell may work for corrosion mitigation."

However, "these considerations have been outweighed by examples of its poor operating practices, such as improperly secured open excavations, odor complaints, pipeline and associated equipment failures, spills, poor reclamation efforts and weed growth at Shell's facilities."

The board noted Shell's proposed project has received a number of objections from landowners, recreational users and others stating concerns about public safety, the environment and the company's operational history.

PG&E hikes cost of San Bruno disaster to up to $760 million

SAN FRANCISCO, Calif. - PG&E on Feb. 17 said its costs from the Sept. 2010 San Bruno natural-gas explosion could exceed $760 million by the end of this year - $150 million more than previous estimates - and that it will probably want some of that expense passed on to consumers.

The San Bruno disaster killed eight people and destroyed 38 homes.

PG&E officials stressed that the full cost of the San Bruno calamity won't be known until federal and state regulators have determined the accident's cause, the numerous lawsuits stemming from the blast are resolved and regulatory authorities clarify what improvements the utility will have to make to its gas system.

Some of those additional costs are expected to include the installation of automatic or remote shut-off lines for the gas transmission lines, since PG&E's crews had trouble shutting off two manual valves feeding gas to the San Bruno fireball. Based on PG&E's previous estimates, those valves could cost as much as $450 million.

According to PG&E's filing on Feb. 17, its costs through this year could total $400 million for liability claims and $363 million for other expenses, many related to improvements on its gas-line system and the search for records.

Much of that expense should be covered by the company's insurance policy, they said. But Kent Harvey, PG&E's chief financial officer, suggested that the company may ask the California Public Utilities Commission to pass on some of the cost to PG&E customers.

Of particular concern to the company is the cost it may incur from having to conduct expensive new tests on its pipelines. Because the SanBruno pipe ruptured at a pressure level below what PG&E had thought was safe, the commission fears the pressure level for other PG&E pipes also may be too high. It has ordered PG&E to produce inspection and other documents verifying that the pressure levels on its various gas lines are appropriate.

PG&E has assembled a small army of hundreds of workers to search for those records.

Four confirmed dead, 50-plus injured in California gas pipeline blast

SAN BRUNO, Calif. - Much of the nation on Thursday evening, Sept. 9, was watching the first game of the NFL season, pitting the New Orleans Saints against the Minnesota Vikings in a repeat of last winter’s Super Bowl. It was the biggest audience for an NFL game in 13 years.

When the blast occurred in the San Francisco suburb of San Bruno, it was about 6:30 p.m. on the West Coast, 8:30 p.m. in the New Orleans Superdome, where the game was being played.

By the next morning, all that was left of some houses in the neighborhood were smoldering ruins. Firemen were still dealing with hot spots.

The gas line that ruptured, sending a towering fireball through the neighborhood, killing at least four people, was a 62-year-old, 30-inch natural gas transmission line belonging to Pacific Gas & Electric (PG&E). The line was an intrastate line under the regulatory jurisdiction of the California Public Utilities Commission.

Fire department and other emergency responders were at the scene in minutes, but the explosion that occurred when the line erupted in flames had severed local water lines. Fire department responders had to tap into hydrants two miles away and lay hose to the site of the blaze. The heat was so intense that it melted asphalt and glass windows. Four firefighters suffered minor smoke inhalation injuries and were treated and released.

By Friday evening, local, state and federal officials, along with PG&E responders, were trying to determine what led to the blast.

Under the Pipeline Safety Act of 2002, pipelines like the one that exploded in San Bruno were to undergo a baseline inspection within five years if in populated areas, and within 10 years if in unpopulated areas. By Friday evening, PG&E was still trying to determine if it had met that requirement.

The 46-mile PG&E pipeline transports gas from Santa Clara County, Calif., to San Francisco. Ironically, one of the reported fatalities was a 44-year old woman who lived at ground zero and worked at the California PUC, which had regulatory jurisdiction over the line that exploded. Her 13-year-old daughter was also reportedly killed in the initial blast.

"It was pretty devastating," Fire Chief Dennis Haag said. "It looks like a moonscape in some areas."

At least 50 people were injured, with three suffering critical burns in the explosion that left a giant crater and laid waste to dozens of 1960s-era homes in the hills overlooking San Francisco Bay.

Some residents said they smelled gas in the neighborhood over the past several weeks, and had reported it to PG&E. They said PG&E employees had come out to look around but left without finding or doing anything.

The utility said it was checking its records for the complaints, but added that none of its crews were at work on the line on Sept. 9, the day the rupture, explosion and fire occurred.

Haag said crews walked through the neighborhood Friday and revised the damage estimate to 38 structures destroyed and seven significantly damaged. Dozens of other homes suffered less severe damage.

Although the pipeline is under state jurisdiction, a four-person team from the National Transportation Safety Board is at the site conducting an investigation. The NTSB normally takes 12 to 18 months to study an accident before releasing a report of its findings with recommendations.

Atmos accused of violating minimum safety standards again

DALLAS-FORT WORTH, Texas - For the third time this year, Atmos Energy has been cited for allegedly violating minimum safety regulations set out by the government.
The citation follows three house explosions over a three-month period.
A just-released report documents a fatal house explosion in Irving, Texas, last January. In it, the Texas Railroad Commission excoriates Atmos for failing to maintain its equipment as required by law.
The findings in the report are among the main reasons Atmos Energy is about to embark on what may be the largest pipeline removal initiative
in Texas history.
In the explosion early in the morning on Jan. 31, natural gas leaked into an Irving residence and ignited. The resulting explosion seriously injured Peggy Mantheiy, who survived. Her husband Joe died a few days later.
Although Atmos Energy crews spent several days repairing natural gas leaks around the Mantheiy's neighborhood, no official cause of the leak has been reported until now.
According to Texas Railroad Commission investigators, "there was a leak on a... compression coupling nut."
It was a "grade one" leak - so powerful that it can be seen in video from the scene bubbling up through the foundation.
The leaking natural gas compression coupling was just a few feet away from the Mantheiy residence, under the ground, attached to the main gas line which runs east and west.
In the days following the explosion, Atmos crews identified 32 similar leaks all over the neighborhood.
That was enough for state regulators to request "replacement of the service lines and their couplings across the entire Irving distribution system."
The findings in the latest report mirror an explosion report issued April 28. In it, Railroad Commission investigators recommended "replacement of all steel service lines in Mesquite" following the blast that leveled Kristi Samons’ house in November.
In the days following her house explosion, workers discovered not only a leaking compression coupling behind her house, but 61 other leaks in the surrounding neighborhood.
Two weeks earlier, the Texas Railroad Commission released another report documenting an explosion in Lancaster in November 2009. In that case, gas leaking from a pipe connection found its way from under the street into a residence. One person was severely burned when the house exploded.
Again, Atmos was cited for "violations of the minimum safety regulations."

AGL-owned gas co. in Virginia cited for multiple pipeline violations

RICHMOND, Va. - Virginia Natural Gas has agreed to pay as much as $1.8 million in penalties to settle state regulators' allegations of multiple pipeline safety violations.
In two settlements with the State Corporation Commission covering more than 40 violations, the company didn't admit or deny the allegations. It agreed to make various changes in its practices and spend $15 million for pipeline-replacement projects.
Under the settlement, VNG cannot recoup the cost of the penalties, repairs or operational changes from rate-payers. The company, based in Norfolk, provides natural gas service to about 271,000 customers in Hampton Roads.
The violations cite failures of the company's workers to follow proper procedures while installing, repairing or conducting maintenance on or around its pipelines. Inspectors for the commission's Division of Utility and Railroad Safety found improper welding methods, the installation of a defective service line and a VNG contractor smoking while working in an excavation near the gas system, according to one settlement. It also cited the company's failure to keep required records or manuals.
One settlement focused on VNG's lack of necessary measures to ensure that underwater pipelines are protected against corrosion. The company completed construction last year of an underwater link between its Peninsula and South Hampton Roads systems. In August, according to the settlements, sections of that pipeline floated from their proper position and had to be fixed.
The instances occurred across VNG's system between 2006 and 2009, said Ken Schrad, a commission spokesman.
No one was harmed and no service was affected as a result of the violations, said Tami Gerke, a spokeswoman for AGL Resources Inc., the Atlanta company that owns VNG.
"Our industry records show no major issues with our pipelines," Gerke wrote in an e-mail response to questions. "Due to regular inspections such as the one completed by the VSCC and audits done regularly by VNG, our customers can be assured that any issues are addressed immediately."
Under the settlements, the company will pay $1 million up front. The commission could waive part or all of the remaining $800,000, depending on the company's compliance with the required remediation, Schrad said.
That includes the hiring of an outside consultant to evaluate the corrosion-control measures. The company must complete most changes by Aug. 15, 2011.

Minnesota stiffens gas pipeline rules following sewer line blast

MINNEAPOLIS, Minn. - State safety officials on May 10 issued new requirements, effective immediately, for documenting the safe installation of gas lines.
The requirements from the Department of Public Safety Office of Pipeline Safety were sent to all 57 gas distribution operators in Minnesota three months after a contractor hit an Xcel Energy pipeline and caused a blast that destroyed a house in St. Paul, Minn.
Pipeline safety director Jerry Rosendahl said on May 10 that Minnesota is the first state to issue such requirements.
Operators who ignore the rules are subject to citations and fines, Rosendahl said.
The requirements are intended to prevent "cross-boring," where underground gas pipelines intersect and puncture privately owned sewer pipes.
On Feb. 1, a roto-rooter contractor punctured a natural gas pipeline that had been inadvertently installed through a sewer service lateral.
The gas escaped into a home and ignited, causing an explosion and fire that destroyed the home.