Remarks of PHMSA Acting Administrator Tristan Brown Before the AOPL-API Fall Meeting

The Madison Hotel, Washington, D.C.

Thursday, October 14, 2021

Good afternoon. Thanks for that introduction and for the opportunity to speak to you today regarding the important actions PHMSA is taking to advance our mission to protect people and the environment by advancing the safe transportation of energy and other hazardous materials that are essential to our daily lives.

I spoke with many of you back in May at the API Midstream Committee Meeting. There I discussed the Biden-Harris Administration's priorities, my experience with safety management systems (SMS) in the aviation sector as well as ongoing challenges at the nexus of cybersecurity and physical operations.

Today, I hope to underscore a few points.

• Safety can, and should be, an area of collaboration-particularly with respect to SMS adoption.
• We have a common responsibility to work together to address greenhouse gas (GHG) emissions, reduce liquid spills, and improve environmental justice.
• Transparency and data sharing are increasingly important and key in helping to improve safety performance across the industry.

Before I address those topics, I'd like to pause to reflect on the past year and a half. At this time, our Nation's transportation system has been coping with unforeseen stresses from the COVID-19 public health emergency, cyber-attacks, and the devastating impacts of hurricanes and other extreme weather events.

PHMSA has continued to work to find creative ways to maintain its safety operations. While COVID-19 forced us to cancel in-person classes at PHMSA's Training and Qualifications (TQ) facility, it did not dampen the TQ staff's spirit and drive to teach. Additionally, training continued virtually for our federal and state inspectors, covering critical safety courses.

We're also very proud of our field staffs' efforts to continue conducting virtual inspections, investigations, and stakeholder outreach through every means available, while navigating travel restrictions and social distancing challenges-including the different rules within each of your member companies.

These collective efforts exemplify the type of new and increasingly complex challenges that everyone in the pipeline sector must navigate on a daily basis. While our mission includes increasingly complex challenges, we are largely achieving results with relatively static amount of resources.

For PHMSA, we largely rely on Congress for changes in our resources. Your member companies rely on company leadership, investors, and ultimately the marketplace. But the marketplace-it is worth underscoring-has not historically been prescient in avoiding costly safety risks. Rather, the market has often pushed to squeeze every little bit out of a pipeline before a major failure snaps the market into reality-and the value of expenditures on more safety precautions. This is not unique to the pipeline transport sector. NASA-revered as including the brightest and best of our nation-struggled with overconfidence and complacency issues that contributed to not one but two space shuttle disasters.

I noted this before, but will follow up with you this time to point you to the testimony before the Senate Commerce, Science, and Transportation Committee a few years ago regarding aircraft failures that led to the death of hundreds of people. When asked by my former boss, Senator Peters, about the value of a robust, independent regulator-the CEO of a major aircraft manufacturer found himself coming to a realization… about the invaluable nature of an independent regulator. The company, once a juggernaut, is still reeling from those failures. To underscore in a language I know you'll understand-its stock price is half what it was just two years ago… while the Dow Jones is up 50%. I offer this as a reminder because I personally can never get enough reminders of things like this that are so fundamentally and vitally important… and yet it's these tragic reminders that usually cause humans to change behavior.

This leads me to SMS. Just a couple of months ago, we commemorated the 22nd anniversary of the Bellingham, Washington, pipeline failure-that tragically resulted in three fatalities. I actually was out in Bellingham in August with Congressman Larsen, the Pipeline Safety Trust, as well as the father of one of the victims-listening to first-hand accounts of that accident.

In the last few weeks, we experienced another pipeline incident that has also captured national attention. These incidents underscore a reminder that we must do all we can do in our quest for safety and do all we can to prevent the next one. Moreover, we must consider that the concept of an "acceptable level of release into the environment" is a long-outdated concept. We-as regulators-have come to this conclusion… and the market is coming to this conclusion as well-so I hope you will not be behind the market.

From discussions with leaders in the industry, I am aware that in fact investors and financial disclosures are driving your companies' decisions as much as regulations these days. That there are tools to operate pipelines in a much safer manner than the industry has been accustomed to, means the pressure to rapidly improve safety across your systems will only increase. And PHMSA will continue to play a role in working to ensure our regulations keep up with what the market is driving as well-a commonly acceptable goal of no accidents and no releases.

Practically speaking, while many of the provisions in the 2020 PIPES Act have a primary focus on natural gas pipelines, due to the emphasis on reducing GHG emissions, there are lessons learned for addressing leaks and aging infrastructure that can be applied for liquid pipelines. And we are considering these mandates in conjunction with how our rulemakings and agency decisions affect underrepresented communities.

As we discussed before, under Secretary Buttigieg's leadership, and in consideration of our congressional mandates, we are carefully considering how our rulemakings and agency decisions will affect the environment, public and community health, and specifically communities that have traditionally been overlooked and underrepresented. Last time one of your members had a question about the Administration's "whole-of-agency" approach to environmental justice-and what that means. No doubt, it means different things in different parts of the country. But to follow up on that discussion-a foundational part of environmental justice is equity. Many communities in this country have been marginalized-sometimes on purpose and sometimes inadvertently-on the basis of race, ethnicity, even geography. Environmental justice can help repair that damage-by addressing historic inequitable treatment. I was glad that someone raised that question the last time I visited with you and I hope you continue that dialogue with PHMSA and each other.

I know there is always interest in PHMSA's regulatory agenda and rulemaking efforts. Our team has been very busy trying to advance the final rules for rupture detection and valve installation, as well as many others. I was actually surprised that since coming to the agency, there's been near universal agreement from industry, public interest stakeholders, and Congress-that PHMSA needs to move, with haste, to ensure we have established rules of the road-in our regulations.

To this end, in addition to the aforementioned rules, we have been aggressively working to move our Unusually Sensitive Areas rule-the importance of which the Huntington Beach accident only underscores.

Many of our pending rules have climate implications. A big focus for us is on the gas side-and reducing methane emissions, due to the tremendous impact it has on climate change. The gas pipeline sector has been "talking a good game" here-but by next year, we will need to see if the rhetoric matches the requirements-to minimize emissions across all pipeline facilities.

We need to do all we can to prevent climate change and reducing leaks which contribute to methane emission is a critical part of that. But we also must adapt to the challenges that are already here, including extreme weather. Some of you operate pipelines in what many of us would consider "extreme" conditions to begin with, but climate change is already amplifying these challenges. The Pacific Northwest experienced a record heat wave this year. We've seen record rainfall in certain microclimates. And these extremes-particularly when experienced in close proximity, from a timing standpoint-can lead to devastating land movements and pipeline ruptures. That appears to have been at play in the CO2 pipeline accident in Mississippi last year. I say this as a cautionary note to you but also because we will be altering inspection schedules to account for these types of extreme climate-change induced risks.

Lastly, I entreated you and your members back in the Spring to set an example for improving transparency and data sharing in the industry. I noted that when operations are more transparent, when regulators have the full picture of problems-we can craft more effectual and targeted regulations-something I would think you can appreciate as being better for business. We have identified multiple instances where companies have waited until the last allowable moment to notify us that a serious non-compliance has occurred, or that a spill estimate has drastically increased in size. In the end, that often makes a problem more costly to fix or mitigate and it reflects poorly on not just your company but the entire industry-both upstream and downstream. It may be hard to quantify how much transparency is worth, but if you think the value of transparency is zero-and you treat it as zero-then I'd suggest you look at some of the industry's leaders in safety and see how they've performed. No doubt, you will find that transparency has value and it reflects in the value of a company's performance.

I'd be remiss, if after the events of the past several months, I didn't again highlight the need for increased vigilance of cybersecurity threats. In light of the Colonial pipeline system attack, the Biden-Harris Administration- including all levels of the executive branch of government-is working to ensure that appropriate cybersecurity measures are in place and that the industry is taking this threat very seriously. PHMSA's role includes coordination efforts with the Department of Homeland Security's Transportation Security Administration and other federal agencies to ensure there is a collaborative and efficient approach to monitoring, inspecting, and promulgating regulations related to cybersecurity in the pipeline industry.

From meetings with leaders in the industry, it is apparent that many of the largest entities understand the risk cyber threats pose. But everyone needs to be aware that the best preventative measures-when it comes to cybersecurity-involve close collaboration with the public and private sectors.

In addition, as part of the Infrastructure Investment and Jobs Act, nearly $2 billion dollars are earmarked to modernize and secure federal, state, and local IT and networks; protect critical infrastructure and utilities; and support public or private entities as they respond to and recover from significant cyberattacks and breaches.

This provision, along with many others, will strengthen our Nation's infrastructure resilience, improve safety, and, in the long run, contribute to a more prosperous economy for all.

As a preview of things to come, you'll soon be hearing more information about PHMSA's upcoming research and development (R&D) public meeting and forum this November, focusing on transportation of hydrogen by pipelines, among other R&D areas. As we look to help position the energy sector, and our Nation, to adopt the infrastructure of the future we hope to continue to engage with many of you all on new technologies and efficiencies. This includes system upgrades to allow for the transport of hydrogen and other renewables to support our growing economy and create jobs for American workers.

Additionally, there will be a meeting of the gas and the liquid pipeline advisory committees on October 20 and 21.

Thank you again for inviting me back for this discussion.

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