Nov 5 2009

Spectra Promises

Spectra Energy’s Response to DEP’s Notice of Violation:

Promises to do what it should have done by law, next time;

5 Recommendations for Penalties

Spectra Energy promises to follow the law the next time there is an emergency at its huge Steckman Ridge underground gas storage field, located in Bedford County, PA.

The company’s recent “unlawful conduct” violated air quality and clean stream regulations of the Pennsylvania Code, according to the Pennsylvania Department of Environmental Protection (DEP).

The DEP issued a “Notice of Violation” to the Houston-based company on September 16.  It required Spectra Energy to respond in 15 days with “a detailed summary of the events that caused the malfunction, emissions and reporting failures as well as Steckman Ridge’s plan to prevent future occurrences.”  [Emphasis added.]  [See pdf file below under "Links & References.]

Spectra Energy’s October 2 two-page response to the DEP offered what could be viewed as a surprise plan to avoid future “reporting failures.”  It offered a “new reporting procedure” in the event of another emergency at its Steckman Ridge underground gas storage field. [See pdf file below under "Links & References.]

The crux of its plan appears based on a promise to follow the law next time!  On August 23, when the nearly 5,000 horsepower compressor station shut down following a gas leak:

  • Pennsylvania Code already requires companies to report emergencies to the DEP by telephone within two hours of an incident.  Spectra Energy failed to do that, but now promises it will follow the law next time.
  • Pennsylvania Code already requires companies to follow up with a written report of the incident to DEP within three days.  Spectra Energy failed to do that, but now promises it will follow the law next time.

In a curious (next-to-the-last) paragraph in its report to DEP, the company wrote [emphasis added]:

“In addition to the above [technical steps], we have implemented a new reporting procedure for any future emergency shutdowns to address malfunction reporting issues.  The procedure requires immediate reporting to PA DEP by telephone of all emergency shutdown gas releases, regardless of any associated oil release.  A written report of such instances of malfunctions will be submitted to PA DEP within three days of the incident.”

Essentially, the company’s “new reporting procedure” boils down to a promise to follow the law next time.  With all due respect to the executive team responsible for this $5 billion company, one wonders how much time was spent around the legal and environmental conference table in order to brainstorm such “a new reporting procedure.”

With homage to Mad Magazine’s “Scenes We’d Like to See”

Picture little Johnny Steckman excitedly waving his hand in the air.  “I’ve got it, I’ve got it,” he burbles.  “How ‘bout if we tell ‘em next time we’ll follow the law – but we call it a New Reporting Procedure?”

Next, regarding Spectra Energy’s plan “to minimize the potential for a recurrence” of the emergency shutdown, the company identifies five engineering or mechanical steps it has taken.  (See page two of the “Steckman Ridge” response in the pdf file below.)

A source familiar with gas operations offered this blog the following comments, based on reviewing the Spectra Energy report and his own experience in the field.  He has not visited the Steckman Ridge storage field.

He speculates, for example, that more was involved in the emergency shutdown than a “cracked pipe fitting.”

“I believe the root cause of the compressor station shutdown and release of natural gas, oil and liquid into the atmosphere was due to liquid shutting down the system — an overload slug of liquids/oil from those wells.  In other words, they got a big slug of liquid at the compressor and it automatically shut down to prevent damage.  Then the station piping blew down, and all the liquids that were in the piping vented to the atmosphere.

“The Spectra Energy report contains several references to actions designed to minimize the amount of liquid in the station piping, and ‘to remove oil from the piping.’  This suggests that liquids were to blame.

“The company said it is evaluating installation of an additional filter separator to aid in removal of liquids from the gas stream.

“In addition, here is an excerpt from, followed by a link to, a Department of Transportation (DOT) inspection form which mentions ‘slugs of liquids’ and the need for automatic liquid removal, compressor shutdown, or high liquid level alarm to combat the slugs.”

The excerpt reads:

Do liquid separators have a manual drain and if slugs of liquid could be carried into the compressor, automatic liquid removal, compressor shutdown, or high liquid level alarm?

Are liquid separators manufactured in accordance with Section VIII of the ASME Boiler and Pressure Vessel Code or a design factor less than or equal to 0.4 if constructed of pipe and fittings with no internal welding?

Link to DOT inspection form:

http://www.phmsa.dot.gov/staticfiles/PHMSA/DownloadableFiles/Files/PHMSA_Form_5_2009.pdf

[See page 4 of the DOT inspection form, under the subhead ‘Design Requirements,' Section .165(b)]:

1 Million Cubic feet of Natural Gas, But Only 20 Gallons of Liquid?

The Notice of Violation was issued to Spectra Energy on September 16 following the company’s poor safety and environmental response surrounding the August 23 emergency shutdown of its nearly 5,000 horsepower compressor station.

In its October 2 response to DEP, the company reported that 967,000 standard cubic feet of natural gas was released into the atmosphere, along with what it estimates was about 20 gallons of oil which showered onto surrounding properties.

Our source, who is familiar with gas operations, raises questions with the estimate that only 20 gallons was released into the atmosphere.  He believes it could have been much higher, perhaps as much as 100 gallons of liquid and oil.

He notes:  “The company’s estimate is based on a review of oil usage, but that is insufficient to conclude that only 20 gallons was released and compressor/motor oil was the only component.  It is likely that all the liquids and natural gas in the piping system were vented to the atmosphere.

Currently the DEP is in the important penalty assessment phase, as it evaluates the company’s response regarding its “unlawful conduct.”

Risky Premise

Some reports are circulating that, because the emergency shutdown did not result in catastrophic failure, it is safe to return to business as usual with, perhaps, a modest fine and a slap on the wrist to Spectra Energy.

It is nice to be lucky, but that should not determine DEP’s penalty assessment.  Spectra Energy demonstrated the equivalent of what strikes many area residents as reckless indifference – and/or reckless incompetence.  (For details, read “Emergency Shutdown” at this link): http://www.spectraenergywatch.com/blog/?p=372

This is the company that promises:  “Safety of the residents and the environment is our primary priority.”  Instead, their performance in the midst of an “emergency shutdown” due to a gas leak in a huge compressor station sitting on top of a 12 billion cubic feet underground gas storage field is a dramatic failure.

Please – No Rerun of 2004 Moss Bluff Incident

In addition, this company did experience a catastrophic failure in 2004 at its Moss Bluff gas storage field outside of Houston.  This involved two explosions, six days of fire with flames as high as 1,000 feet and two evacuations.

Spectra Energy has declined to share what it learned from that experience in order to demonstrate that it provides improved performance at its Steckman Ridge field.  (For details, read “Moss Bluff Incident” at this link): http://www.spectraenergywatch.com/blog/?p=390

Its “new reporting procedure” with its commitment to follow the law next time suggests that Spectra Energy still does not get it.

What if we’re not lucky next time?  It is always in the public interest to take a tough stand on behalf of safety and the environment.

The Steckman Ridge station is approximately three miles from an elementary school.

And there is a bonus here for Spectra Energy.  It could demonstrate tangible commitment to the safety of residents and the environment.  This could mark a new phase in its community relations that go far beyond handing out gift certificates.

Following are recommendations for DEP to consider in its evaluation.

5 Penalty Recommendations

1)    Consideration of a fine should start at $100,000 and only move up.

2)    One-year probation of the facility with unannounced inspections and visits.

3)    DEP to staff one of its engineers at the site – with all compensation and other expenses to be paid by Spectra Energy for this person.  The DEP staffer would remain on site for one year, then the DEP could decide whether to extend its presence there, based on Spectra Energy performance and quality improvement.

4) A full-time site manager to be assigned to Steckman Ridge.  This person must be an employee of Spectra Energy (FTE, versus a contract person).  This person must be on site at the Steckman Ridge facility and be the responsible leader at that site.

5) Keep the Steckman Ridge compressor station fully staffed until the liquid  problem is resolved and additional equipment is installed and proven effective.

We want Spectra Energy to be a responsible member of our community – to be the best it can be in that regard.  Keep the gift certificates.  Make sure that our environment is safe and clean; and that our families and properties are safe.

LINKS & REFERENCES

Spectra Energy Response to DEP’s Notice of Violation: steckman-ridge-response-ltr

DEP’s Notice of Violation to Spectra Energy: dep-violation-notice-p1 dep-violation-notice-p2

Pennsylvania Code Citations

25 PA Code Citations:

http://www.pacode.com/secure/data/025/articleICIII_toc.html

91.33. Incidents causing or threatening pollution:

http://www.pacode.com/secure/data/025/chapter91/s91.33.html

Air Pollution Control Act:

http://www.dep.state.pa.us/DEP/DEPUTATE/airwaste/aq/regs/apca.pdf

Clean Streams Law:

http://www.dep.state.pa.us/dep/deputate/minres/oilgas/CSLawuc.htm

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