67932 Federal Register / Vol. 62, No. 249 / Tuesday, December 30, 1997 / Notices

funding) to fund the modifications and

testing.

Panoz sold 13 cars in 1993 and 13

more in 1994. It did not state its sales

in 1995. Because of the effort needed to

meet Federal emission and safety

requirements, Panoz did not build any

1996 model year vehicles. It reports

sales of 23 model year 1997 vehicles in

the 12 months preceding its application

for second renewal. At the time of its

original petition, Panoz’s cumulative net

losses since incorporation in 1989 were

$1,265,176. It lost an additional

$249,478 in 1993, $169,713 in 1994,

$721,282 in 1995, and $1,349,241 in

1996.

The applicant reiterated its original

arguments that an exemption would be

in the public interest and consistent

with the objectives of traffic safety.

Specifically, the Roadster is built in the

United States and uses 100 percent U.S.

components, bought from Ford and

approximately 80 other companies. It

provides employment for 45 full time

and three part time employees. The

Roadster is said to provide the public

with a classic alternative to current

production vehicles. It is the only

vehicle that incorporates ‘‘molded

aluminum body panels for the entire

car’’, a process which continues to be

evaluated by other manufacturers and

which ‘‘results in the reduction of

overall vehicle weight, improved fuel

efficiency, shortened tooling lead times,

and increased body strength.’’ With the

exception of S4.1.4 of Standard No. 208,

the Roadster meets all other Federal

motor vehicle safety standards

including the 1997 side impact

provisions of Standard No. 214.

Interested persons are invited to

submit comments on the application

described above. Comments should refer

to the docket number and the notice

number, and be submitted to: Docket

Section, National Highway Traffic

Safety Administration, room 5109, 400

Seventh Street, SW, Washington, DC

20590. It is requested but not required

that 10 copies be submitted.

All comments received before the

close of business on the comment

closing date indicated below will be

considered, and will be available for

examination in the docket at the above

address both before and after that date.

To the extent possible, comments filed

after the closing date will also be

considered. Notice of final action on the

application will be published in the

Federal Register pursuant to the

authority indicated below.

Comment closing date: January 29,

1998.

(49 U.S.C. 30113; delegations of authority at

49 CFR 1.50. and 501.8)

Issued on December 23, 1997.

L. Robert Shelton,

Associate Administrator for Safety

Performance Standards.

[FR Doc. 97–33954 Filed 12–29–97; 8:45 am]

BILLING CODE 4910–59–P

DEPARTMENT OF TRANSPORTATION

Research and Special Programs

Administration (RSPA), DOT

[Docket No. RSPA–97–3224; Notice 10]

Pipeline Safety: Intent To Approve

Shell Pipe Line Corporation for the

Pipeline Risk Management

Demonstration Program

AGENCY: Office of Pipeline Safety, DOT.

ACTION: Notice.

SUMMARY: The Research and Special

Programs Administration’s (RSPA)

Office of Pipeline Safety (OPS) plans to

approve Shell Pipe Line Corporation

(SPLC) as a participant in the Pipeline

Risk Management Demonstration

Program. OPS believes the SPLC

demonstration project will provide

superior safety by applying numerous

risk control measures which exceed

regulatory requirements, including

increased right-of-way surveillance;

smart pig inspections; close interval

cathodic protection surveys; enhanced

communications with One-Call,

excavators, and the public; additional

overpressure protection; and selected

depth-of-cover surveys. This notice

explains OPS’s rationale for approving

this project, and summarizes the

demonstration project provisions

(including affected locations, risk

control and monitoring activities, and

regulatory exemptions) that would go

into effect once OPS issues an order

approving SPLC as a Demonstration

Program participant. OPS seeks public

comment on the proposed

demonstration project so that it may

consider and address these comments

before approving the project. The SPLC

demonstration project is the first of

several projects OPS plans to approve

and monitor in assessing risk

management as a component of the

Federal pipeline safety regulatory

program.

ADDRESSES: OPS requests that

comments to this notice be submitted on

or before February 4, 1998, so they can

be considered before project approval.

However, comments on this or any other

demonstration project will be accepted

in the Docket throughout the 4-year

demonstration period. Comments

should be sent to the Dockets Facility,

U.S. Department of Transportation,

Plaza 401, 400 Seventh Street, SW,

Washington, DC 20590–0001, or you can

E-Mail your comments to

ops.comments@rspa.dot.gov. Comments

should identify the docket number

RSPA–97–3224. Persons should submit

the original comment document and one

(1) copy. Persons wishing to receive

confirmation of receipt of their

comments must include a self-addressed

stamped postcard. The Dockets Facility

is located on the plaza level of the

Nassif Building in Room 401, 400

Seventh Street, SW, Washington, DC.

The Dockets Facility is open from 10:00

a.m. to 5:00 p.m., Monday through

Friday, except on Federal holidays.

FOR FURTHER INFORMATION CONTACT:

Elizabeth Callsen, OPS, (202) 366–4572,

regarding the subject matter of this

notice. Contact the Dockets Unit, (202)

366–5046, for docket material.

SUPPLEMENTARY INFORMATION:

1. Background

The Office of Pipeline Safety (OPS) is

the federal regulatory body overseeing

pipeline safety. As a critical component

of its mandate, OPS administers and

enforces a broad range of regulations

governing safety of pipelines and

environmental protection. These

regulations have contributed to a good

pipeline industry safety record by

ensuring that risks associated with

pipeline design, construction,

operations, and maintenance are

understood, managed, and reduced.

Preserving and improving this safety

record is OPS’s top priority. On the

basis of extensive research, and the

experience of both government and

industry, OPS believes that a risk

management approach, properly

implemented and monitored through a

formal risk management regulatory

framework, offers opportunities to

achieve:

(1) Superior safety and environmental

protection;

(2) Increased efficiency and service

reliability of pipeline operations; and

(3) Improved communication and

dialogue among industry, the

government, and other stakeholders.

A key benefit of this approach is the

opportunity for greater levels of public

participation.

As authorized by Congress, OPS is

conducting a structured Demonstration

Program to evaluate the use of a

comprehensive risk management

approach in the operations and

regulation of interstate pipeline

facilities. This evaluation will be

performed under strictly controlled

conditions through a set of

demonstration projects to be conducted
Federal Register / Vol. 62, No. 249 / Tuesday, December 30, 1997 / Notices 67933

with interstate pipeline operators. While

OPS may exempt a participating

operator from particular regulations if

the operator needs such flexibility in

implementing a comprehensive risk

management project, regulatory

exemption is neither a goal nor

requirement of the Demonstration

Program.

2. OPS Evaluation of SPLC

Demonstration Project Proposal

Using the consultative process

described in Appendix A of the

Requests for Application for the

Pipeline Risk Management

Demonstration Program (62 FR 14719),

published on March 27, 1997, OPS is

prepared to finalize the agreement with

Shell Pipe Line Corporation (SPLC) on

the provisions for a demonstration

project SPLC will conduct on two

pipeline segments it operates. The

consultative review process ensures that

OPS considers and addresses comments

on the SPLC proposal from all

stakeholders and interested parties.

Several means have been used to

provide information on the proposed

project and solicit questions and

concerns. These include: (1) Previous

notices in the Federal Register (62 FR

40136 (July 25, 1997) and 62 FR 53052

(October 10, 1997)); (2) an Internet

Information System (PRIMIS) available

via the OPS Home Page; (3) broadcasts

via the Federal Emergency Management

Agency’s (FEMA) Emergency Education

Network (EENET) (OPS received over

2,000 ‘‘hits’’ on the website broadcast

featuring SPLC); (4) a prospectus and

map that OPS and SPLC produced and

mailed to over 400 people, including

representatives from Local Emergency

Planning Committees (LEPC) along

affected pipeline routes; and (5) a

November 19, 1997, public meeting OPS

hosted in Houston, TX.

OPS has also solicited comment on

the SPLC proposal from other federal

agencies (including the Department of

Justice and, via the Regional Response

Teams, the Environmental Protection

Agency), state and local government

officials, public interest groups, and

industry and community

representatives.

This notice is the last public comment

opportunity prior to approval of SPLC’s

demonstration project. OPS will address

and resolve any issues and concerns

raised through the consultative process

with SPLC.

Company History and Record

SPLC is a wholly owned subsidiary of

Shell Oil Products Company, employing

over 700 people, and operating

approximately 8,000 miles of pipelines

in 18 states. Originally incorporated in

1919 (as the Ozark Pipe Line

Corporation), SPLC today transports

approximately 4.0 million barrels of

crude oil, refined products,

petrochemicals, carbon dioxide, and

natural gas daily.

SPLC is headquartered in Houston,

Texas. SPLC’s parent corporation, Shell

Oil Products Company, is currently

seeking government approval to merge

its refining, transportation, and

marketing operations with Texaco and

Saudi Refining Inc. The merger will

affect SPLC, although the details are not

yet known. In its Order approving

SPLC’s demonstration project, OPS

would require that the merged company

demonstrate that it will continue to

commit to the objectives of the

Demonstration Program, and to comply

with the requirements of the Order.

Before entering into consultations

with SPLC, OPS determined that SPLC

was a favorable candidate for the

Program, based on an examination of

the company’s safety and environmental

compliance record, its accident history,

and its commitment to working with

OPS to develop a project meeting the

Demonstration Program goals. Neither of

the two pipeline segments SPLC is

proposing for its demonstration project

has experienced a release due to unsafe

operation (Section 4 of this document

describes the demonstration sites and

the releases in the demonstration

segments).

However, in December, 1988, another

pipeline operated by SPLC spilled

20,554 barrels of crude oil into the

Gasconade River near Vienna, Missouri.

The cause of the spill was a

manufacturing defect; the consequences

were aggravated by SPLC’s failure to

quickly stop the pipeline flow. The

subsequent OPS investigation of the

spill found no violations by SPLC of the

pipeline safety regulations. Following

this spill, SPLC undertook a companywide risk assessment and risk reduction

effort resulting in improved employee

training, new or more aggressive

approaches to in-line inspection (smart

pigging), hydrotesting, hydraulic surge

and spill volume analysis, and

installation of additional mainline block

valves. Lessons learned from the

December 1988, release and the

subsequent company-wide assessments

form the foundation for SPLC’s

proposed risk management

demonstration project.

With regard to employee safety, from

among some fifteen other candidates,

SPLC was selected as the American

Petroleum Institute (API) ‘‘Safest Major

Pipeline Operator’’ in 1990, 1993, 1994,

and 1995, and was in second place in

1992 and 1996.

Consultative Evaluation

During the consultations,

representatives from OPS headquarters

and Southwest Region, pipeline safety

officials from Texas, Louisiana, and

Colorado, and risk management experts,

met with SPLC to discuss SPLC’s risk

assessment, supporting analyses,

proposed risk control activities,

performance measures, and means of

administering risk management within

the company. The discussions

addressed technical validation of all

proposed activities, demographics and

terrain along affected pipelines,

communications with outside

stakeholders, and monitoring and

auditing of results once the

demonstration project is underway. The

demonstration project provisions

described in this notice evolved from

these consultations, as well as from any

public comments received to date. Once

OPS and SPLC consider and address

comments received on this notice, OPS

plans to issue an Order approving the

SPLC demonstration project.

3. Statement of Project Goals

OPS and SPLC believe SPLC’s

demonstration project will improve

safety through the application of

numerous risk control measures that

exceed regulatory requirements on both

pipeline segments, particularly in the

area of third party damage prevention.

Increased right-of-way surveillance;

smart pig inspections; close interval

cathodic protection surveys; enhanced

communications with One-Call,

excavators, and the public; additional

overpressure protection; and selected

depth-of-cover surveys are some of the

more significant activities that will be

added to existing measures to improve

safety.

SPLC is proposing that segments of

two pipeline systems (the TexasLouisiana System and the Cortez

System) comprise its demonstration

project. SPLC conducted a thorough and

systematic risk assessment to identify

hazards and risks associated with

operating both of the pipeline segments.

SPLC then identified various activities

that are intended to result in reduced

risk and superior safety and reliability

on both pipeline segments.

SPLC’s risk assessment process relies

heavily on the expertise of people

familiar with the operation,

maintenance, construction, and history

of the pipeline. With an average length

of service of over 25 years, several of the

people who participated in SPLC’s risk

assessments have worked on the
67934 Federal Register / Vol. 62, No. 249 / Tuesday, December 30, 1997 / Notices

proposed demonstration segments since

the segments were constructed. The risk

assessments confirmed expectations,

outlined previously in SPLC’s Letter of

Intent, that third-party damage (i.e.,

contractors, landowners, or others who

accidentally strike pipelines during

excavation and/or other activities) is the

most significant risk posed to either

pipeline segment. Therefore, SPLC’s

highest priority for its risk management

demonstration project is to prevent this

type of damage.

For the Texas-Louisiana System,

SPLC will supplement the required

activities it now performs with

numerous new and additional risk

control activities based on SPLC’s

comprehensive risk assessment. SPLC

seeks no regulatory exemption on the

Texas-Louisiana system. SPLC makes a

strong case that the risk of a release on

this system will be reduced, and

superior safety will result. Releases from

the Texas-Louisiana System pose little,

if any, risk to the environment due to

the volatile nature of the commodity

transported (ethylene).

For the Cortez System, SPLC has also

identified new and additional risk

control activities and has performed

several technical validations supporting

a pressure increase beyond present

regulatory limits at an existing pump

station in Cortez, CO. SPLC’s

assessment shows that a combination of

risk control activities, coupled with

installation of redundant overpressure

protection systems, will offset any

increase in risk from the pressure

increase that the company is requesting

for the Cortez segment. With the

flexibility to raise pressure above

regulatory limits, SPLC can increase

throughput (the amount of commodity

transported) without having to construct

an intermediate pump station in Blanco,

NM. The Cortez System transports

carbon dioxide (CO2), which is a

naturally occurring component of the air

and presents no environmental hazard.

The regulatory exemption would apply

to a 25-mile segment of the pipeline

located in a rural and sparsely

populated area in Colorado.

For both pipeline segments, SPLC will

improve emergency preparedness

through increased discussions with and

the sharing of the results of dispersion

modeling with local emergency

responders.

4. Demonstration Project Pipeline

Segments

The Texas-Louisiana System

SPLC’s 250-mile Texas-Louisiana

Ethylene Pipeline System (the TexasLouisiana System) transports chemicalgrade ethylene between Shell Oil

Product’s Deer Park, TX, manufacturing

complex and its Napoleonville, LA,

transfer facility. SPLC’s customers use

ethylene for manufacturing plastics,

detergents, antifreeze, and other

consumer products. Ethylene is a

flammable, highly volatile liquid that

becomes a slightly lighter-than-air gas

when released to the atmosphere. Under

certain conditions, it could form an

explosive vapor cloud until diluted or

dispersed. SPLC proposes to include

205 miles of this system—from its Mont

Belvieu, TX, compressor station to a

block valve at the western edge of the

Atchafalaya Basin east of New Iberia,

LA—in its risk management

demonstration project. Although routed

mostly through rural areas, the line

passes near five large industrial and

developing residential areas, and

includes more than 40 road crossings

and 12 water crossings. Due to its

volatile nature, ethylene is not

considered a water pollutant.

The Texas-Louisiana line has

experienced 2 reportable releases since

it was commissioned in 1979, both the

result of third party damage. These two

releases resulted in no fatalities or

injuries, although a fire and explosion

did occur during the latter of these

releases (1981). There was no fire or

explosion associated with the first

release (1979). The total volume of

ethylene released to the atmosphere in

these two events was the equivalent of

approximately 14,000 barrels of liquid.

Neither event affected the environment.

There have been six minor, unreportable

releases totalling the equivalent of

approximately 220 barrels of liquid,

caused by miscellaneous mechanical

failures. Four additional ‘‘near miss’’

events of third party damage to the

pipeline system (one in the past few

months) have also occurred, none of

which resulted in a release.

The Cortez System

The 502-mile Cortez carbon dioxide

(CO2) Pipeline System (the Cortez

System) carries naturally-occurring

commercial-grade CO2 from Cortez, CO,

across New Mexico to Denver City, TX.

CO2 is injected into oil wells to aid in

the production of crude oil. CO2 is a

nonflammable, inert, non-toxic liquid

that, when released to the atmosphere,

becomes a heavier-than-air gas.

Although CO2 is a naturally occurring

component of air and presents no

environmental hazard, at high

concentrations in confined, low lying

areas, it can present an asphyxiation

hazard until it is dispersed or diluted.

The operating pressures on this line

presently range from 2147 pounds per

square inch gauge (psig) to 2999 psig.

These pressures are high compared to

pipelines in general, but are typical for

pipelines transporting CO2.

SPLC proposes to include the

northwestern half of the Cortez System

(roughly 260 miles), from the Cortez

pump station to the inlet of its pressurereducing station at Edgewood, NM (east

of Albuquerque). The line traverses

rolling hills, mountainous areas, and

sandy soils, passing near five small

communities. The route crosses four

major rivers and about 15 major roads.

The segment of the Cortez line in the

demonstration project is located mostly

in sparsely populated, rural areas.

The Cortez line has experienced no

releases since it was commissioned in

1984. There have been four ‘‘near miss’’

events of third-party damage to the

pipeline system. OPS databases have no

records of any releases from CO2

pipelines that have resulted in injury or

death.

Neither demonstration segment is

likely to impact the environment.

5. Project Description

The following risk control and

monitoring activities would be included

in the Order OPS issues formally

approving the SPLC demonstration

project.

Risk Control Activities

The company proposes using

inspection techniques on both

demonstration pipelines to determine if

there has been any past, unknown

damage while simultaneously applying

a combination of risk control activities

and risk communications to reduce the

likelihood and the consequences of

future third-party damage. In addition,

the company believes that several of

these risk control activities will help

prevent third party damage on its newly

constructed propylene pipeline, which

runs parallel to parts of the TexasLouisiana line. The activities proposed

by SPLC to address damage from

outside parties go beyond the minimum

requirements in the existing Federal

Pipeline Safety Regulations.

SPLC has committed to:

• Increasing scheduled air patrol of

the lines from every two weeks to

weekly;

• Improving air patrol effectiveness

through enhanced staff training,

including techniques for more

immediate reporting and evaluation of

potential instances of third party

encroachment to responsible SPLC

personnel in the vicinity;

• Adding traffic barriers to

aboveground equipment near roadways
Federal Register / Vol. 62, No. 249 / Tuesday, December 30, 1997 / Notices 67935

to reduce the likelihood of vehicle

accidents impacting the pipeline;

• Reviewing locations of and

supplementing where appropriate

existing right-of-way markers that

identify the presence of a pipeline,

including adding Global Positioning

System (GPS) locating information on

markers;

• Increasing ground surveillance of

the lines in densely populated areas;

• Enhancing company sponsorship of

the local One-Call system (the system in

which excavators provide notification of

their intent to dig so that underground

utilities like pipelines can be located

and protected prior to digging);

• Significantly upgrading public/

neighbor education and awareness

efforts (including media usage);

• Conducting community-based

emergency planning, training, and

drills, so that both the company and

local officials will be better prepared in

the event of an accident;

• Using a warning ‘‘mesh’’ for

backfilling during new construction or

significant repairs (excavators digging

near a line would encounter this mesh

before hitting the pipe);

• Running in-line inspection

device(s) on the Texas-Louisiana

demonstration segment to determine if

there is any existing mechanical damage

to the pipeline from prior third party

encroachments; and

• Assessing other risk control

measures and staffing requirements.

SPLC will also perform dispersion

analyses for the Texas-Louisiana

ethylene demonstration segment to

better understand the potential

consequences of a release, and thus help

improve emergency response planning

and communications with local

responders.

Increased Throughput on the Cortez

System

With implementation of the above

activities to control the causes of the

most significant risks to both of the

demonstration segments, SPLC believes

it can then proceed with a plan to

increase the Cortez System’s throughput

(the amount of product transported)

while still delivering superior safety.

This plan calls for increasing the

maximum operating pressure by up to

11 percent beyond what is allowed by

the regulations on the 25-miles of

pipeline immediately downstream of

the Cortez pump station. In the Order

authorizing SPLC to commence its

demonstration project, OPS will exempt

SPLC from 49 CFR 195.406(a)(1–3),

which addresses the maximum

operating pressure for pipelines

transporting hazardous liquids.

To support its evaluation of risk

associated with increased operating

pressure on the Cortez line, SPLC

conducted several technical analyses.

These include:

• A comprehensive review of the

original pipe specifications; actual

materials’ properties; pipemill

manufacture, inspection, and testing

procedures; and field construction and

inspection techniques that

demonstrated the pipe’s safety margin

exceeds regulatory requirements, and

thus can safely handle the proposed

increase in operating pressure;

• Steady state transthermal hydraulic

analysis and computer modeling to

determine the actual pressure and

corresponding safety factors at any point

in the pipeline under normal and worst

case operating conditions;

• Surge analyses and modeling to

determine the pressure at any point in

the pipeline under abnormal or

unexpected operating events; and

• Dispersion analyses to better

understand the potential consequences

of a release, and thus help improve

emergency response planning and

communications with local responders.

Additional Risk Control Activities on

the Cortez Line

In addition, prior to any increase in

operating pressure on the Cortez

segment (expected to occur in August–

September, 1998), SPLC’s plan also calls

for:

• Conducting a Close Interval Survey,

which involves inspection and electrical

testing every two to three feet along the

pipeline to confirm the ability of

protection systems to mitigate corrosion,

and to help detect if there is any coating

damage that might indicate the presence

of mechanical damage to the pipeline

from possible prior third party

encroachments.

• Performing a Depth-of-Cover Survey

(from the Cortez Station to the 25-mile

mark) to ensure adequate protection

from external mechanical damage and

loading.

• Developing a Geographic

Information System (GIS) Data Base

(from the Cortez Station to the 25-mile

mark) to test its applicability and

usefulness for pipeline operations,

including emergency response.

• Installing additional equipment at

the Cortez Station beyond that currently

required by the regulations to provide

four levels of redundant protection

against overpressure situations. This

will provide additional assurance that

the pressures in the pipe will not exceed

the safe levels determined from the

system review noted above.

• Doubling the inspection frequency

from once per year to every six months

for the overpressure protection devices

mentioned above.

Monitoring Demonstration Project

Effectiveness

The SPLC Demonstration Project

includes a comprehensive approach to

performance monitoring that assures the

superior protection of public safety, and

achieves other project objectives. A key

element of this monitoring plan is a set

of performance measures that would

track the growth and institutionalization

of risk management within the

company, measure the effectiveness of

SPLC’s risk control activities, validate

analyses supporting current safety

activities, and provide a basis for future

improvement. Examples include: The

number of SPLC-operated pipeline

systems under risk management (should

increase if risk management is feasible);

the number of unmonitored

encroachments on the pipeline right-ofway (should decrease due to improved

communications); accuracy of One-Call

reports (should improve due to

improved pipeline markers); employee

awareness of risk management process

(should improve through training and

participation in process); quantity/

accessibility of data to support risk

assessment (should improve as

performance measure data

accumulates). SPLC will report

performance measure data and project

progress regularly to OPS throughout

the four year demonstration period. This

information, as well as periodic OPS

audits, will assure accountability for

improved performance.

6. Regulatory Perspective

Why OPS Plans To Approve This Project

OPS is considering SPLC’s proposed

project for the Demonstration Program

because, after extensive review, OPS is

satisfied that the proposal:

A. Provides superior safety for both of

the demonstration segments. For the

Cortez line, OPS is satisfied that the

safety margin in the pipe can

accommodate the proposed increase in

pressure without adding significant

additional risk to the public.

Furthermore, SPLC has adequately

demonstrated that the combination of

third party damage and other risk

control activities described earlier more

than offset any increase in risk

associated with the higher operating

pressure in the first 25-miles of the line.

For the Texas-Louisiana ethylene line,

all of the proposed risk control activities

go beyond the current regulatory
67936 Federal Register / Vol. 62, No. 249 / Tuesday, December 30, 1997 / Notices

1The City simultaneously filed a motion to

dismiss the notice of exemption. The Board will

address the jurisdictional issue raised by the motion

to dismiss in a subsequent decision.

2The lease was executed in 1895 by NCRR and

Southern Railway Company (NS’s predecessor). See

Norfolk Southern Railway Company and Atlantic

and East Carolina Railroad Company—Lease and

Operation Exemption—North Carolina Railroad

Company, Finance Docket No. 32820 (ICC served

Dec. 22, 1995).

requirements and thus provide a higher

level of public protection than exists

today.

B. Offers a good opportunity to

evaluate risk management as a

component of the Federal pipeline

safety regulatory program. OPS believes

the Demonstration Program could

benefit from SPLC’s participation, given

some of the distinguishing features of its

proposed demonstration project,

including:

• Comprehensive evaluation of two

distinctly different pipeline systems

transporting different products, in

different locations with substantially

different surroundings, representing

significantly different risks;

• Emphasis on improving damage

prevention and emergency response

coordination;

• Concentrated public outreach and

risk communications efforts;

• A good illustration (on the TexasLouisiana line) of how companies can

use risk management to improve safety

without seeking to reduce costs incurred

by existing regulations;

• Willingness to share information

with OPS and state pipeline safety

agencies on the specific risks associated

with the demonstration line segments,

as well as its risk management program

and processes (which is far more

information than is typically provided

in the existing compliance process).

This additional information allows OPS

to more effectively ensure safe

operation, as well as helps OPS

understand how risk management might

be employed to supplement the existing

regulatory framework; and

• Systematic allocation of resources

to potentially higher-risk operations.

How Will OPS Oversee This Project?

OPS retains its full authority to

administer and enforce all regulations

governing pipeline safety. Except for the

increase in maximum operating

pressure over the initial 25-mile

segment of the Cortez line, SPLC is not

requesting any regulatory relief or

exemptions. Both of these lines will be

subject to routine OPS inspection to

ensure compliance with the applicable

Federal Pipeline Safety Regulations. In

addition, subsequent to approval, the

Demonstration Project will be

monitored by a Project Review Team

(PRT) consisting of OPS headquarters

and regional staff and state pipeline

safety officials. The PRT is designed to

be a more comprehensive oversight

process, which draws maximum

technical experience and perspective

from all affected OPS regional and

headquarters offices as well as any

affected state agencies that would not

normally provide oversight on interstate

transmission projects. One of the

primary functions of this Team will be

to conduct periodic risk management

audits, which will be performed in

addition to the normal OPS inspections.

These risk management audits will be

used to ensure company compliance

with the specific terms and conditions

of the OPS Order authorizing this

Demonstration Project. OPS is

developing a detailed audit plan,

tailored to the unique requirements of

the SPLC Demonstration Project. This

plan will describe the audit process

(e.g., types of inspections, methods, and

their frequency), as well as the specific

requirements for reporting information

and performance measure data to OPS.

Information Provided to the Public

OPS has previously provided

information to the public about the

SPLC project, and has requested public

comment, using many different sources.

OPS aired two electronic ‘‘town

meetings’’ (June 5, 1997, and September

17, 1997) enabling viewers of the twoway live broadcasts to pose questions

and voice concerns about candidate

companies (including SPLC). Two

earlier Federal Register notices (62 FR

40135; July 25, 1997 and 62 FR 53052;

October 10, 1997) informed the public

that SPLC was interested in

participating in the Demonstration

Program, provided general information

about technical issues and risk control

alternatives to be explored, and

identified the geographic areas the

demonstration project would traverse.

Since August, OPS has used an

Internet-accessible data system called

the Pipeline Risk Management

Information System (PRIMIS) at http://

www.cycla.com/opsdemo to collect,

update, and exchange information about

all demonstration candidates, including

SPLC.

At a November 19, 1997, public

meeting OPS hosted in Houston, TX,

SPLC officials presented a summary of

the proposed demonstration project and

answered questions from meeting

attendees. (Portions of this meeting were

broadcast on December 4, 1997. This

broadcast is available on demand via

our OPS website ops.dot.gov/

tmvid.htm.)

OPS has provided a prospectus,

which includes a map of the

demonstration sites, to State officials

and community representatives who

may be interested in reviewing project

information, providing input, or

monitoring the progress of the project.

This notice is the last public comment

opportunity prior to approval of SPLC’s

demonstration project.

Issued in Washington, DC on December 23,

1997.

Richard B. Felder,

Associate Administrator for Pipeline Safety.

[FR Doc. 97–33863 Filed 12–29–97; 8:45 am]

BILLING CODE 4910–60–P

DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

[STB Finance Docket No. 33529]

City of Charlotte, North Carolina—

Acquisition Exemption—

Certain Assets of the North Carolina

Railroad Company

The City of Charlotte, NC (the City),

a noncarrier, has filed a verified notice

of exemption under 49 CFR Part 1150,

Subpart D—Exempt Transactions to

acquire from the North Carolina

Railroad Company (NCRR) certain

physical assets of an approximately 1.1-

mile line of railroad (the Line) located

between 2nd Street and 12th Street in

Charlotte, Mecklenburg County, NC. 1

The City will purchase the Line from

NCRR for the purpose of constructing

and operating a passenger rail transit

system. The City is acquiring the Line

subject to a preexisting lease between

NCRR and Norfolk Southern Railway

Company (NS) 2, whereby NS will

provide all common carrier service on

the Line. NCRR will retain an exclusive

freight operating easement sufficient to

accommodate both NS’s continuing

common carrier obligation and NCRR’s

own residual common carrier

obligation. Consummation of the

transaction is expected on or after

December 18, 1997, the effective date of

the exemption.

This notice is filed under 49 CFR

1150.31. If the notice contains false or

misleading information, the exemption

is void ab initio. A petition to revoke the

exemption under 49 U.S.C. 10502(d)

may be filed at any time. The filing of

a petition to revoke will not

automatically stay the transaction. An

original and 10 copies of all pleadings,

referring to Finance Docket No. 33529,

must be filed with the Surface

Transportation Board, Office of the

Secretary, Case Control Branch, 1925 K

Street, N.W., Washington, DC 20423–