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Liquid/Gas Pipeline Advisory Committee Meetings

Liquid/Gas Pipeline Advisory Committee Meetings. Joint Session December 12, 2012 Jeff Wiese. Content Review. Stage Setting Remarks Energy Future & Pipeline Implications Preordained Workload Uncertainties Abound Pipeline Metrics Review FY 2013 Priorities. Energy Future.

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Liquid/Gas Pipeline Advisory Committee Meetings

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  1. Liquid/Gas Pipeline Advisory Committee Meetings Joint Session December 12, 2012 Jeff Wiese

  2. Content Review • Stage Setting Remarks • Energy Future & Pipeline Implications • Preordained Workload • Uncertainties Abound • Pipeline Metrics Review • FY 2013 Priorities

  3. Energy Future • Key Takeaways from DOE’s Annual Energy Outlook for 2013 • Crude oil production, particularly from tight oil plays, rises sharply over the next decade • Natural gas production is higher, with natural gas increasingly serving the industrial and electric power sectors, as well as an expanding export market

  4. 2011 Top Oil Producing States • Texas. The Eagle Ford shale formation in south Texas contributed to gains in the state's oil production, which averaged 1,425 thousand barrels per day (bbl/d), the highest level since 1997. • Alaska. Oil production fell for the ninth year in row, averaging 563 thousand bbl/d. • California. Oil production averaged 535 thousand bbl/d, the lowest level in at least three decades. • North Dakota. Preliminary data indicate increasing oil production from the Bakken formation pushed North Dakota ahead of California in December as the third biggest oil-producing state. North Dakota's oil production averaged 535 thousand bbl/d in December 2011 and 419 thousand bbl/d for the year. • Oklahoma. Oil production averaged 204 thousand bbl/d during 2011, topping 200 thousand bbl/d for the first time since 1998.

  5. 2011 Top Gas Producing States • Texas. Natural gas production increased 4.5% from the year before to the highest level since 1980, due in part to growing output from the Eagle Ford shale formation where drillers who are aggressively pursuing high-value liquid hydrocarbons are also producing growing amounts of natural gas. • Louisiana. Natural gas production increased 38% as the Haynesville shale gas formation in the northwest part of the state was one of the biggest shale gas producing plays in the United States. • Wyoming. Natural gas production fell 5.6% to the lowest level since 2007, as lower natural gas prices made coalbed methane gas that accounts for almost two-thirds of the state's natural gas production less profitable because high-priced gas liquids aren't normally found in coal seams. • Oklahoma. Natural gas production increased 3.9% to the second highest annual output since 1994 due to higher output in the Woodford shale play. • Colorado. Natural gas production grew about 1.4% as output increased for the 25th year in a row to break another record output high. The Niobrara shale play in the northeast corner of the state helped raise Colorado's natural gas production.

  6. Implications for Pipelines • Clearly – A Rapid Expansion of Gathering Lines • Many no longer present traditional low risk profile • Significant Expansion of Both Gas and Liquid Transmission • Many will try to use existing ROW • But expect a significant uptick in new siting applications • Immediate Issues • Need to regulate riskier “rural” gathering lines • Communities need to consider/adopt PIPA best practices • States need to up their damage prevention oversight

  7. Preordained Workload • U.S. Congress • 37 mandates • National Transportation Safety Board • 28 open recommendations / 2 closed + 6 to DOT • Office of the DOT Inspector General • 9 open recommendations + ongoing audit • U.S. Government Accountability Office • 2 open recommendations + ongoing audit • Organizational and Workforce Management

  8. Uncertainty Abounds • Resources • FY 2013 President’s Budget Request – Currently Under a Continuing Resolution that Bars “New Starts” • Looming “Fiscal Cliff” – 8.2% Across the Board Cuts • Difficulty with Recruiting – With Emphasis on Diversity • Uncertainty and Sluggishness of the Regulatory Process • Partisan/Philosophical Debate at All Levels

  9. Pipeline Safety Metrics • January 7-8, 2013 Pipeline Data Workshop • http://primis.phmsa.dot.gov/meetings/MtgHome.mtg?mtg=81&nocache=9447 • Significant Accidents - Frequency

  10. Pipeline Safety Metrics • Significant Accidents – Total Fatalities

  11. Pipeline Safety Metrics • Significant Pipeline Accidents – Injuries

  12. Pipeline Safety Metrics • Significant Pipeline Accidents – Property Damage

  13. Pipeline Safety Metrics • Significant Pipeline Accidents

  14. Top Priorities for FY 2013 Anticipate & Avert High Consequence Events by: • High Priority Rule Making (Refreshing IMP, Gathering, etc.) • Improvement of State Program Oversight • Improve Oil Spill Response Plan Build & Broadcast Understanding of Safety Risks by: • Data Driven Risk Informed Inspection Process (II and IA) • Public and Emergency Responder Awareness • Recruiting and Retaining a Diverse and Qualified Staff • Congressional Act Mandates • Recommendations (NTSB, OIG, GAO) Catalog & Curtail Highest Risks by: • IMP 2.0 - Sharpening understanding and communication of specific integrity challenges • Implement the Data Strategic Plan • Damage Prevention (PIPA, 811,…)

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