Interpretation Response #PI-20-0004

Below is the interpretation response detail and a list of regulations sections applicable to this response.

Interpretation Response Details

Response Publish Date: 04/07/2020

Company Name: Buckeye Texas Processing, LLC

Individual Name: Mr. Kevin Burke

Location State: TX Country: US

View the Interpretation Document

Response text:

Mr. Kevin Burke
Sr. Director and GM South Texas District
Buckeye Texas Processing, LLC
7209 Up River Road
Corpus Christi, TX 77406

Dear Mr. Burke:

This letter is being provided in response to supplemental information received from you relating to an interpretation response letter issued by the Pipeline and Hazardous Materials Safety Administration (PHMSA) to Buckeye Texas Processing, LLC (Buckeye) on September 10, 2019 (September 10, 2019 Letter). This letter supersedes and replaces the prior interpretation; therefore, the September 10, 2019 Letter is withdrawn.

Background

By letter dated July 27, 2018, Buckeye requested an interpretation of the exception in 49 CFR § 195.1(b)(8) for transportation of hazardous liquid through refining facilities or storage or in-plant piping systems associated with such facilities. On September 10, 2019, after several communications with Buckeye, PHMSA responded to the company's request for interpretation. In October 2019, PHMSA met with Buckeye to discuss the September 10, 2019 Letter. At that meeting, Buckeye presented supplemental information. In response to Buckeye's presentation of new information, PHMSA posed several follow-up questions, which Buckeye provided written responses to on November 8, 2019. PHMSA reviewed the responses, held a teleconference with Buckeye on December 10, 2019, and sent follow-up questions to Buckeye on December 10, 2019. On January 29, 2020, Buckeye submitted responses to PHMSA's follow-up questions.

On February 13, 2020, Buckeye submitted a memorandum that clarified and categorized Buckeye's reconsideration request as it relates to two issues: (1) the refining exception of 49 CFR 195.1(b)(8) and its application at Buckeye's refining facility; and (2) the application of 49 CFR 195.1(b)(3)(ii) as it relates to the low stress pipelines (i.e. Modes A, B and C) serving the refining facility. Buckeye and PHMSA met again in Washington, D.C. on February 18, 2020, to discuss the memorandum.

Analysis

The Federal pipeline safety regulations apply to pipeline facilities and the transportation of hazardous liquids or carbon dioxide associated with those facilities. However, 49 CFR 195.1(b)(8) excepts from the Part 195 regulations the "transportation of hazardous liquids or carbon dioxide through onshore production (including flow lines), refining, or manufacturing facilities or storage or in-plant piping systems associated with such facilities." In this exception, in-plant piping system means "piping that is located on the grounds of a plant and used to transfer hazardous liquid or carbon dioxide between plant facilities or between plant facilities and a pipeline or other mode of transportation, not including any device and associated piping that are necessary to control pressure in the pipeline under § 195.406(b)." In addition, Part 195 excepts low-stress pipelines that serve refining facilities, if the pipeline is less than one mile long and does not cross an offshore area or waterway currently used for commercial navigation. See § 195.1(b)(3)(ii).

In 1992, when PHMSA proposed the definition of in-plant piping, the agency explained that pressure control devices necessary to control pressure of a regulated pipeline would mark the limit of part 195 application inside a refining facility. If there is no pressure control device, such as on an un-regulated low-stress line, in-plant piping would extend to the plant boundary. See Regulatory Review: Hazardous Liquid and Carbon Dioxide Pipeline Safety Standards, 57 Fed. Reg. 56305, Nov. 27, 1992.

Buckeye owns and operates a crude oil refining facility located in Corpus Christi, Texas. The facility is served by crude oil pipelines identified by Buckeye as Mode A, Mode B, Mode C, Mode D, and Mode E. According to Buckeye, the refining facility includes storage and an in-plant piping system associated with the refining facility.

The September 10, 2019, Letter was based on the agency's evaluation of the information Buckeye had provided at that time, which did not include information about low-stress pipelines. Since that time, Buckeye has presented additional information to PHMSA, which has changed the agency's understanding of Buckeye's refinery facility. Therefore, PHMSA provides the following revised interpretation.

With regard to the Mode A, Mode B and Mode C pipelines, Buckeye has asserted they are low-stress pipelines that meet the § 195.1(b)(3)(ii) exception and thus not required to have § 195.406 pressure control devices. As noted above, if the pipelines were regulated, the point of demarcation between these pipelines (i.e. Mode A, Mode B, and Mode C pipelines) and Buckeye's in-plant piping system would be the pressure control device necessary to control pressure, or the facility boundary if there is no pressure control device on plant grounds. (See 57 Fed. Reg. 56305). Buckeye has indicated the current point of demarcation is the nearest valves downstream of the receivers for pipelines moving in crude oil (i.e. Mode A and Mode B), or upstream of the launchers for pipelines moving crude oil out (i.e. Mode B and Mode C). PHMSA believes these demarcation points are not inconsistent with § 195.1 for the Mode A, Mode B, and Mode C pipelines if they are unregulated low-stress pipelines.

With regard to the Mode D pipeline, which Buckeye acknowledges is subject to the regulations in Part 195, Buckeye indicated that it is operated by a third-party, who delivers crude oil inbound to the refinery from the third party's terminal. Buckeye also stated that the pipeline pressure is limited using a pressure control device and associated surge relief piping. Specifically, the pressure relief valve and surge relief piping that leads to the refinery's Tanks TK-1004, TK-1005, and TK-1006 results in those tanks being characterized as breakout tanks, which would be regulated under Part 195. Buckeye further stated that since the emergency shutdown valve protects in-plant piping that could influence pressure on the Mode D pipeline, it determined the demarcation point between the Mode D pipeline, which would be regulated under Part 195, and the refinery's in-plant piping system to be the outlet flange of the valve located immediately downstream of the emergency shutdown valve. PHMSA believes Buckeye's chosen demarcation point is not inconsistent with § 195.1 for the Mode D pipeline. This includes the pressure relief valve and piping leading to the breakout tanks, including the breakout tanks, as well as the Mode D pipeline from the outlet flange downstream of the emergency shutdown valve.

Finally, with regard to the Mode E pipeline, which Buckeye acknowledges is subject to the regulations in Part 195, Buckeye indicated that a third-party operates the pipeline, transporting crude oil outbound from the refinery to a third-party refining facility. Buckeye also indicated that the pressure on the Mode E pipeline is limited by the combination of a pressure transmitter and a motor-operated valve located near the refinery's boundary. Consequently, Buckeye has determined that the demarcation point between the Mode E pipeline, which would be regulated under Part 195, and the refinery's in-plant piping system is the inlet flange of the motor-operated valve. PHMSA believes Buckeye's chosen demarcation point is not inconsistent with § 195.1 for the Mode E pipeline. The point of demarcation for the Mode E pipeline would be valve upstream of the pressure transmitter and the motor-operated valve as annotated in the piping and instrumentation diagram provided by Buckeye on November 8, 2019.

PHMSA provides this written interpretation of the Federal pipeline safety regulations in response to a specific request of interpretation, and reflects the agency's application of the regulations to the specific facts presented by the person requesting the clarification. If additional or differing facts are presented, PHMSA's interpretation may change.

If we can be of further assistance, please contact Tewabe Asebe at 202-366-5523.

Sincerely,

John A. Gale
Director, Office of Standards
and Rulemaking

Regulation Sections