Aliso Canyon Disaster Highlights Risks, Inadequate Safety Rules Governing Natural Gas Storage

Jerri-Lynn here: Quelle surprise!  Looks like that self-regulation fairy was — and will continue to be– about as effective in regulating the Alito Canyon natural gas storage facility as it has elsewhere proven to be in so many other areas and situations where it’s supposed to protect the public from harm.

By Justin Mikulka, a freelance writer, audio and video producer living in Trumansburg, NY. Justin has a degree in Civil and Environmental Engineering from Cornell University. Originally published at DeSmogBlog

A recent report spearheaded by researchers at the University of Southern California blames the largest greenhouse gas leak in U.S. history on dysfunctional management and poor regulatory oversight. Southern California Gas (SoCalGas) is the company that operates the Aliso Canyon natural gas storage facility near the Los Angeles neighborhood of Porter Ranch, which suffered a catastrophic methane leak that lasted from October 2015 to February 2016.

“SoCalGas had lenient requirements for infrastructure record keeping, no comprehensive risk management plan, and no testing programs or plans in place to remediate substandard wells,” concluded Najmedin Meshkati, University of Southern California professor of civil and environmental engineering and senior author on the report. The study was published in the Journal of Sustainable Energy Engineering.

In addition to its notable contribution to global warming, the massive methane leak also required the evacuation of two schools and at least 8,000 residents for months while SoCalGas tried to stop the leak.

The California Public Utilities Commission also issued a report evaluating the failed storage well at Aliso Canyon, and noted that “severe external corrosion was observed in the failure areas.” Based on these reports, it appears that SoCalGas had a policy of allowing its gas storage wells to operate until they failed, such as at Aliso Canyon.

DeSmog reached out to SoCalGas for comment on the University of Southern California study but did not hear back.

A History of Industry Self-Regulation

In theory, outside inspectors could have potentially caught some of these safety issues during regular evaluations of the infrastructure. But as the University of Southern California’s report details, that is not how the natural gas storage industry operates in the U.S. Instead, its description of the circumstances leading to the leak reads as much like a recipe for future disaster as an analysis of past failures. Previously, the industry has largely been allowed to self-regulate and the trend continues today.

This picture is reinforced by a Government Accountability Office (GAO) audit published in November 2017. The report reveals that about half of the nation’s active natural gas storage sites are overseen on a variable state-by-state basis, but as for the other half, which straddle state lines:

“Prior to 2017, the remaining 204 interstate natural gas storage sites were subject solely to federal oversight. However, the federal government had not issued safety standards for them.”

Slightly less than half of the 415 natural gas storage sites in America have been operating without safety standards or inspections by federal regulators.

However, if SoCalGas had known that the well at Aliso Canyon was likely to fail, would the company have addressed the problem on its own? Apparently not, because according to its own company logs, SoCalGas had known about the potential for a leak in that particular well since 1992.

No current regulations require safety shut-off valves on natural gas storage wells like the one that failed at Aliso Canyon. In an interesting twist of fate, Aliso Canyon’s failed well actually had an underground safety valve, but SoCalGas removed it in 1979 and did not replace it, despite its own documents decades later noting the well was at risk of leaking.

Apparently, SoCalGas requested to raise customer rates in 2010 in order to make repairs and replace leaking safety valves, but its plan was to do so at a rate of only five percent of affected valves a year.

Newly uncovered information shows that Southern California Gas Company admitted five years ago it operated numerous leaking wells in Aliso Canyon, received a ratepayer increase to upgrade these wells, and yet deliberately failed to replace safety valves on its gas injection wells,” said attorney Patricia Oliver, who is involved in one of the lawsuits about the incident, in January 2016.

In July 2017, James Mansdorfer, a former SoCalGas employee in charge of the wells at Aliso Canyon, highlighted additional risks associated with potential earthquakes at the gas storage facility.

My belief is that there is potential for catastrophic loss of life, and in light of SoCalGas refusal to openly address this risk, my ethics just will not allow me to stand by without making the public aware of what could happen,” Mansdorfer told the Los Angeles Daily News.

Status Quo or Outlier?

According to the 2017 Government Accountability Office (GAO) audit, other natural gas storage sites may pose similar risks as Aliso Canyon due to aging infrastructure or proximity to population centers.

The audit notes that many of these natural gas storage sites “are located within 3 miles of a city, town, or other populated area.”

In addition, half of the “17,000 wells that inject and withdraw natural gas from storage sites are more than 50 years old, and many wells are more than 100 years old.” These older wells  “were often drilled for other reasons, such as oil and gas production, and are more likely to have age-related degradation, according to [the Department of Energy].”

Inadequate Interim Regulations 

In June 2016, just months after the Aliso Canyon incident, Congress passed the Protecting Our Infrastructure of Pipelines and Enhancing Safety (PIPES) Act, which requires the Department of Transportation (DOT) “to establish minimum safety standards for all natural gas storage sites by June 2018,” according to the GAO report. As a result of the PIPES Act, the DOT’s Pipeline and Hazardous Materials Safety Administration (PHMSA) issued an interim rule for safety standards and is responsible for finalizing that rule.

As the GAO audit points out, the interim rule is already potentially problematic. The first problem is that these gas storage site regulations are only voluntary and based on industry recommendations, as noted in the audit, which takes a critical look at PHMSA’s regulatory oversight:

“Under the interim standards, site operators are to follow industry-developed best practices to detect and prevent leaks and plan for emergencies, among other things.”

This approach looks suspiciously similar to asking the natural gas storage industry, after causing the largest ever U.S.methane release, to regulate itself once again. The PIPES Act also created an Aliso Canyon Natural Gas Leak Task Force, which made several safety recommendations, including the following:

“Operators of natural gas storage sites should begin a rigorous program to evaluate the status of the wells, establish risk management planning, and, in most cases, phase out old wells with single-point-of-failure designs.”

Of course, recommendations outline what operators “should” do to prioritize safety. However, recommendations do not provide guarantees or oversight that safety actions which should be done actually are done.

Oil and Gas Industry Weighs in

The task force also recommended “that operators phase out most storage wells with single-point-of-failure designs — where the failure of a single component, such as a well casing, could lead to a large release of gas — by installing multiple points of control at each well.“ This would translate to SoCalGas and other storage site operators installing safety shut-off valves on all natural gas wells.

Yet as detailed in the GAO audit, PHMSA did not require this practice in its proposed safety rule because the American Petroleum Institute, the oil and gas industry’s largest trade group, claimed “its recommended practices do not direct operators to phase out such wells because this practice may not significantly improve safety in all cases.”

As a result, regulators have chosen to ignore a federally created safety task force in favor of following the advice of oil and gas industry lobbyists. But to fully appreciate the audacity of the lobbying group’s claim that shut-off valves don’t necessarily improve well safety, you need to know the argument made to back up this claim.

The American Petroleum Institute cites the Aliso Canyon disaster as an example of why phasing out wells with a single point-of-failture (i.e., those without shut-off valves) should not be required because, it says, such an approach might not have prevented the accident. Instead, it recommends assessing the risks at each storage site and taking steps to reduce those risks, which “could include installing multiple points of control for certain wells, among other possible mitigation steps.”

Meshkati, the senior author of the University of Southern California study, has a different take on how a shut-off valve might have changed the Aliso Canyon leak, which occurred at a storage well known as “SS-25.”

“If a functional kill valve were in place for well SS-25 in October 2015 when the leak began, the leak could have been stopped in a matter of hours or days rather than after four months,” Meshkati said.

Audit Details Safety Rule Limitations

On top of this glaring example of the industry shaping its own regulatory process, the GAO found that PHMSA was doing a poor job with the new safety rules. The audit notes the steps PHMSA has been taking to improve its oversight is limited in both scope and strategy:

“For example,PHMSA has not yet defined the level of performance to be achieved, fully addressed all core program activities, or used baseline data to develop its performance goal … PHMSA’s goal focuses on training and does not address other core program activities, such as conducting effective inspections. For example, a goal to evaluate whether PHMSA’s inspections are effective could be to annually reduce, by a certain percentage, the number of sites not meeting minimum standards.”

Over two years after the Aliso Canyon disaster, the federal officials in charge of improving the safety of U.S. natural gas storage have outlined vague and incomplete aspirations for improving safety, but one point they were clear on was that, as the oil and gas industry says, shut-off valves shouldn’t be necessary.

PHMSA has come under fire from safety advocates before, with Rep. Jackie Speiers (D-CA< once referring to the agency as “a fluffy industry pet.” And, in line with that assessment, PHMSA recently repealed regulations requiring oil trains to have modern brakes. Of course, PHMSA is now run by a former executive of freight train company CSX, and CSX is a big player in the oil-by-rail business.

“How many more oil and gas disasters have to occur before a healthy culture of safety is implemented?” asked Meshkati in the press release accompanying his study.

The GAO audit hints that there is plenty of time to find out: PHMSA published guidance on its website stating that it expects operators to make and implement plans to inspect and remediate risks found at their sites within 3 to 8 years following the effective date of the interim final rule.”

So, business as usual.

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  1. Larry

    I say let them self-regulate, but if a major accident happens the CEO is held accountable with prison time. Self-regulation only works if there are real consequences for the people in charge.

    1. Harry

      Incentives would be perverse. Ultimately CEOs of these kind of utilities will be chosen for their ability to do hard time for their shareholder. I suppose it would be goodfor the Crips.

    2. Norb

      Whatever happened to honor? Catastrophic failure and malfeasance should carry very harsh social punishment. But in our current capitalist order, this concept is turned on its head. These CEO’s are rewarded ever more handsomely depending on the extent of the social breech they commit- and get away with.

      This is pathological behavior. To knowingly bring about harmful events, and then inevitably, look for ways to avoid taking responsibility for the outcomes by lying or obfuscating.

      The logical end to this madness is when any pretence to following social limitations is done away with. What a horrible outcome. But still, the majority in America are capitalist cheerleaders, unable to see that unchecked corporatism is the problem.

      Socialism is the answer. How can you cheerlead for the capitalist system and expect different outcomes- you can’t. When personal greed outweighs all other considerations, human society loosed out- every time.

      I am reminded of the image of an Aztec priest, cutting the heart out of some hapless villager to appease some God, and casting the dead body down the temple steps, all for the purpose of a good show- and to make a broader social point, reinforcing the priest’s power. How are any of these contemporary stories any different? The priests of Capitalism are doing Gods work and the rest of us are left to suffer.

      There is a thing called social evolution. Humanity either evolves past this predatory nature, or our species will surely be doomed. The individuals espousing that humanity has reached some plateau with the capitalist order are surely wrong. How much more evidence is needed?

      Business as usual, until we are all dead.

  2. third time lucky

    Under the watchful eyes of (frack’em till the drop) Sally Jewell, ex Mobil Oil Sec of Interior; and (gotta earn me some Tubmans) Barry Obama, ex Chicago conman POTUS. They collected the penalty on citizen’s behalf, though at huge discount .

  3. The Rev Kev

    If there is one function that a Government should never give up it is that of the duty of inspections of industries. At the very least, forgetting about how it would give governments leverage over corporations, it would help put a stop to a lot of the reckless behaviour that we see in corporations in their dash for cash.

  4. Robert Thomas

    ..without regulations and oversight…mistakes will be made again. Problem is: Who decides on the regulations and method of oversight/ enforcement?

    Many years ago, groups of engineers from industry and government (non-profit small groups of people) used to meet and develop what were called “standards.” The industry adopted the standards voluntarily, and there was minimal federal government oversight necessary because everyone involved understood the risks of not complying with the standard practice. It worked well in many industries, and I am certain the standards called for maintenance to be done which was not absolutely necessary, but as a precautionary longer-term measure.

    I believe one of the first cases pointed to as an example was the boiler industry. Early in the 20th Century, boilers were not required to me made with pressure relief valves. This resulted in many catastrophic explosions in both houses and in manufacturing plants.

    We still have that standard in the USA but what has been lost over the years is the sense of shared responsibility. It is costly to incorporate pressure relief valves, certainly, but the costs saved a lot of lives over the many years since.

    I place the blame on individual high level corporate decision-makers within the industry companies. Perhaps I conveniently conclude that American industry (generally speaking, of course) does not place a high value on good engineering practice. You may notice that it is increasingly rare to find industry executives (who are promoted into the highest corporate positions) who have an engineering and technical background sufficient to understand and manage risks associated with mechanical equipment. Today one finds the maintenance engineering positions taking a back seat to finance, who garner the highest salaries whilst the lonely engineer interested in keeping the plant maintained and running smoothly, stagnates.

    This kind of event described above will continue to occur as long as risks of operating plant and equipment are sidelined or delayed.

    Pure capitalism we will find, does not work on behalf of the society as a whole. The common good is better held in the hands of the educated public sector employee at state or federal levels. Will it cost? Surely, but would you rather save money for corporate shareholders or save some lives without being fully aware of exactly how many or at what exact cost?

  5. David

    Good article.

    PHMSA recently repealed regulations requiring oil trains to have modern brakes.

    The PHMSA repealed a mandate for a particular type of brake [Electronically Controlled Pneumatic Brake] because,

    The National Academy of Sciences determined it was unable to make a conclusive statement regarding the emergency performance of ECP brakes relative to other braking systems. In addition, the updated RIA [Regulatory Impact Analysis] incorporated recommendations from audits conducted by the U.S. General Accountability Office and updated costs and benefits of the ECP brake provision based on current economic conditions. This review demonstrated that the costs of this mandate would exceed three-fold the benefits it would produce.

    Also, regarding Emergency Shutdown Valves [ESV], the industry lobbyists you mentioned above put out a report that provides a good review of the risks and challenges of ESV systems.

    The benefits include risk reduction related to consequence mitigation by limiting the magnitude and duration of an event that occurs downstream of the valve…ESV system technology is a proven technology that has been extended to wider applications in terms of depth, location, diameter and pressure-temperature-flow regimes.

    The disadvantages of ESV systems, particularly SSSVs [Subsurface Safety Valves], include functional reliability weaknesses for components of ESV systems, potential impairment of storage service reliability, increased risk to workers and the public due to increased well re-entry (service) rates and related loss-of-containment potential, and increased challenges with emergency intervention operations…

    The report recommends that the industry “support, develop, and implement risk-based integrity management plans to mitigate risk, reduce potential adverse impacts, consider ways to mitigate the consequences of a casing or casing/cement system loss-of-control/loss-of-containment event, while balancing potential unintended consequences related to the application of equipment like ESVs, SSVs [Surface Safety Valves] and SSSVs.

    Robots can’t do this stuff.

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