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Canada's pipeline regulator revises quality programs

The report from Canada's National Energy Board (NEB) is in response to the detection of inappropriate materials used in fittings.

10/07/2017


In recent months, Canada's National Energy Board (NEB) has expanded the scope of its previous safety advisory and draft order regarding the quality assurance of pipeline materials. In late 2015, the Transportation Safety Board of Canada (TSB) released a pipeline investigation report on a 2013 gas pipeline rupture incident that concluded the pipeline failure was due to the pipeline operating beyond its temperature design limits.

However, during the investigation, the TSB also noted that fittings used on that pipeline contained materials that did not meet the appropriate specifications. While these fittings were not the incident's direct cause, they raised a red flag and the NEB began investigating the issue immediately. The NEB is an independent federal regulator of several parts of Canada's energy industry, including pipelines, energy development, and trade.

It does so in the public interest, with safety as its primary concern. At the moment, it is embroiled in a controversy concerning the review of the proposed Energy East pipeline. 

Unfolding narrative

In February 2016, the NEB issued two safety advisories and an order that required NEB-regulated companies to identify and report on purchased and installed pipeline components that contain material properties that do not meet standard associations' requirements. Subsequently, the NEB became aware of additional quality issues associated with pipeline fittings.

According to Reuters, the push for a shift in standards for pipeline parts came after TransCanada Corp and Enbridge Inc. discovered some that they were using were substandard. In April, the NEB warned about parts from Tecnoforge, a subsidiary of Italy's Valvitalia SpA, and South Korea's TK Corp., but did not name the companies using them.

TransCanada and Enbridge said in separate statements they acted immediately and proactively after discovering the issues and that all their pipes were safe.

In April, the NEB issued an amended safety advisory and order. The amended advisory expands the scope of the previous one by naming additional manufacturers whose components did not meet requirements. The draft order will require NEB-regulated companies to identify components fitting this description, confirm they are safe, and take appropriate mitigation measures.

The board also made a key safety standard, CSA Z662 - Oil and Gas Pipeline Systems, available online free of charge.

The NEB stressed there is no immediate risk to the public or the environment. No incidents have been reported on NEB-regulated pipelines that relate to the use of these materials. 

Impact assessment

The NEB's Onshore Pipeline Regulations section 23 requires regulated companies to conduct pressure testing on all pipe and fittings before they can be connected to a pipeline system. In all cases fittings are pressure-tested to at least 25% above maximum operating pressure.

The NEB expects regulated companies to demonstrate a proactive commitment to continual improvement in safety, security, and environment protection, and to promote a positive safety culture as part of their management systems. To support these expectations, the draft order will require companies regulated by the NEB to: 

  • Verify components having material properties not meeting required specifications;
  • Provide a timeline to conduct engineering assessments that demonstrate the safety of identified pipeline components installed in operating pipelines having material properties not meeting the required specifications;
  • Provide a timeline to revise the company's quality assurance program, as required under section 15 of the NEB Onshore Pipeline Regulations, which is aimed at preventing the installation of pipeline components with material properties not meeting the required specifications; and,
  • The company's accountable officer must file a written confirmation certifying that the engineering assessments have been completed and the quality assurance program has been revised.

After reviewing the received comments and making changes where appropriate, the NEB will finalize the draft order.



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