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Remarks before the Association of Oil Pipe Lines, Washington, DC
Jim Hall
Association of Oil Pipe Lines, Washington, DC

Thank you for inviting me to be here today. I appreciate the opportunity.

I have been Chairman of the NTSB now for five years - long enough, I hope, to have begun to understand what the government can do, and what the private sector must do, to keep transportation safe. And I think I have seen as well, the necessity of respecting the many singularities that differentiate the modes of transportation.

All transport is infrastructure, but some, like the highways and airways, depend on the government to build or operate critical components. And direct government regulation of speeds, or altitudes, or direction of travel is a central and accepted part of the backdrop. On the other hand, mariners ply lanes of travel made by mother nature, and the code for ships' captains, like the creed of river pilots, reflect not decades, but centuries of development -- of change and resistance to change. I can tell you there are some problems here.

Railroads travel largely over their own rights of way, nearly all in the private domain. NTSB investigators, if not secretly viewed as trespassers, are certainly newcomers to the scene.

It is not too many decades past that the Interstate Commerce Commission did accident investigations by delegating to the railroad itself the responsibility to reflect the circumstances of its mishaps. What appears now to be an inexplicably quaint approach actually reflected the fact that accidents typically occurred on private property and were of nearly invisible public consequence.

Times have changed. Cargo and capacities and the proximity of rails to spreading population have made the potential for a catastrophic hazardous materials collision a nightmarish potential that communities do disaster drills to prepare for.

And I can tell you, there are still some problems here.

But your industry too has folks concerned. Your lines carry energy, liquid and gaseous energy. As the population spreads, and as the demand for your services grows, capacity and proximity become compounding problems for you. And the products in your lines, if they escape, pollute and kill. Bellingham Washington is a tragedy. The next Bellingham could be a huge catastrophe as well. And if it happens, it will be a media event that will define your industry. Like Exxon Valdez and TWA flight 800, some names will become household. And rest assured, the manner in which pipelines are regulated will be changed irrevocably.

Recently, I read a letter from your association director, Ben Cooper, to Congressman Bob Franks. The letter was about the Bellingham, Washington rupture. Ben expressed a good deal of concern about the possibility of criminal prosecutions, employees taking the fifth, and the impact that all this has on the ability of the NTSB to do its business. Let us first remember that three young men lost their lives in that tragedy. Furthermore, we all know that harm to the environment is, to some, the defining crime of industrial society. And, we all know that there are in EPA dedicated staffers who will vindicate the public right to a clean environment at the drop of a drop of oil. And we all know that spills can be crimes, without any argument over intent, without need for gross or willful behavior.

But it would be too facile to look at these circumstances and say that they explain fully why, when a pipeline ruptures, the initiation of a criminal investigation is as likely as not.

There is also the absence of a proactive regulatory environment, let me suggest shelter. A regulatory context that is comprehensive, progressive, proactive, and trusted by those whose interests it is meant to protect. There is nowhere today the sense that the Office of Pipeline Safety (OPS) is in charge.... or that its regulations, its inspections, its assets, its staffing, and its spirit, are adequate to the task. We at the NTSB have been asked too often, by communities, and courts, and citizen groups, to do jobs which are assigned by design to OPS to believe that trust in the Research and Special Programs Administration and OPS is deep and wide. It is otherwise. And you, as much as the government, are responsible for the deficiency.

NTSB is anxious to understand what happened at Bellingham. We are trying to examine the design and construction of the pipeline; we are looking at the equipment used; the operating systems; the inspection, testing and maintenance activities; excavation activities; and, of course, the controllers and their reactions. Progress has been slow. But to be frank, we will not be surprised to find that some of the factors in this accident reflect lessons that went unlearned. OPS does not have a good record of responding to NTSB recommendations, and industry influence has a great deal to do with this.

Ben Cooper told Congressman Franks that the operator in Bellingham is anxious to cooperate with the government in finding out what went wrong. But meaningful cooperation with the government goes well beyond helping the NTSB find the cause of an accident.

You must do your part to ensure that enlightened regulation ensures the safest of systems in the first place. For decades the Safety Board has called for achievable solutions to recurrent problems. Some examples include: 1) rapid shutdown of failed pipelines, 2) periodic inspection or testing of old pipelines, and 3) improved training of employees.

Pipeline industry reaction to these recommendations has often been tepid, if not hostile. Your opposition before Congress and the regulator has frequently been quite effective, but I believe very shortsighted. I am tempted to say I wish you as much luck with the judge and jury. Nature abhors a vacuum, even a regulatory vacuum.

But like you, I would prefer to avoid regulation through the courts. I recommend that you ask your lawyers to get you copies of the settlement agreements reached between the U.S. Attorney and the State's Attorney in Rhode Island and the operator who allowed an oil barge to break up on Point Judith. It was precise and expensive. Negotiated rulemakings may be all the rage for reaching acceptable arrangements with your regulators. Negotiated settlements in the face of criminal indictments are another thing altogether.

In 1995, at RSPA's reauthorization hearing, the Chairman of the General Committee on Pipelines of the American Petroleum Institute (API) opposed legislation being considered that would have required periodic inspection of pipelines by instrumented internal inspection devices. He suggested that the inspections would be extremely expensive.

At the same hearing, the Interstate Natural Gas Association and the American Gas Association urged Congress to deny OPS any increase in funding and they also opposed the use of smart pigs, excess flow valves, and certain operator training requirements.

Do you think these arguments are truly wise? If you do, think about them as they appear to a prosecutor, or an attorney structuring a punitive damage case. We do not see the name ValuJet much any more, but we remember it. And it is back in the news because of criminal proceedings, including manslaughter counts. You may not recall, but one of the truly unfortunate problems in the ValuJet crash was that the regulator did not do its job, though, of course, it remains unindicted. It is the private sector that will bear the judicial consequences of lax or absent regulation.

The Safety Board first addressed the need for remote closure valves 29 years ago in a study entitled Effects of Delay in Shutting Down Failed Pipeline Systems and Methods of Providing Rapid Shutdown. It only makes sense to have a safety mechanism that allows controllers to remotely isolate a failed section after a pipeline ruptures. I congratulate pipeline operators who have made the decision to install these valves. But their installation should have been mandated and regulated and, if it had been, questions about subsequent liability would be vastly simplified. The same can be said about the effective use of internal inspections. Ultimately, this will be a requirement of law. How much say you have in designing the requirement depends on the circumstances in which the requirement is imposed.

Using remotely controlled valves and reading internal inspections data depends on a competently trained and qualified workforce. But during the past four years, the Board has found, in every hazardous liquid pipeline accident investigated, that controllers failed to quickly identify that a rupture occurred. And, of course, since 1987, the Safety Board has been urging OPS to require strong training programs to ensure that controllers are able to sense and react to emergencies. And industry has been opposed. The recent action by OPS is inadequate, not surprisingly. However, some companies have responded and moved beyond minimal government regulations. After the Reedy River accident in South Carolina, Colonial Pipeline improved its controller training program and incorporated the use of a simulator to evaluate controller responses to abnormal operating conditions.

In addition, Marathon Ashland PipeLine LLC has advised the Board that by next year, they too will use a simulator to more effectively train and evaluate their controllers. Why not make these programs standard and supervised at the federal level? Why not get in advance, an agreement from the entire federal government about what needs to be done, and ensure yourself against second-guessing in a hostile forum?

Abraham Lincoln said "You cannot escape the responsibility of tomorrow by evading it today." I challenge each of you to review your company's corporate culture. What safety message are you sending your employees? How extensive is your pipeline inspection program? What tools have you put in place to control problems when they appear? How effective is your employee training and evaluation programs?

I hope the answer to all of those questions reflects a proactive, safety conscious corporate culture. The communities you operate in and the citizens who reside in them deserve no less. They deserve the assurance that a pipeline operating near them is safe, that it has been inspected and tested, and that the people operating it are fully qualified and trained. The responsibility to operate safe pipelines ultimately rests with its leaders.

Let me close by noting that exactly one month from today we will be ringing in the New Year and a new millenium. I have been assured that the industry has put significant resources into guarding against any Y2K incidents. Some companies are even taking additional precautions.

Colonial, Buckeye, and Explorer pipelines, despite the economic ramifications and although they believe that their systems are Y2K-compliant, have decided to idle their pipelines for several hours before midnight on December 31 and into the year 2000. I congratulate both companies for making safety their priority.

Again thank you for inviting me to be here today. I know I have offered something of a challenge. I hope you will take in the spirit intended. When we are not moving forward, we are usually moving backward, because events pass us by. As the leaders of the pipeline industry, I urge you not to let that happen to your industry.