Pipeline Integrity Management and Data Science Blog

Mega Rule Compliance through Digital Transformation

More than a decade in the making, the new Department of Transportation (DOT) mega rule— Code of Federal Regulations (CFR), Title 49, Part 191 and 192—was driven by continuing failures in pipeline systems, including the fatal 2010 gas pipeline rupture and fire in San Bruno, California, and oil leaks into rivers in Michigan and Montana.

The mega rule, which goes into effect July 1, 2020, applies to more than 500,000 miles of gas and hazardous liquid pipelines in the United States. In general, the rule stipulates tougher safety regulations and more stringent reporting, and it expands integrity management requirements to gathering lines and other previously unregulated pipelines.

Requirements vary by pipeline product and type. For example, operators of gas transmission and distribution pipelines have to update incomplete records, including maximum allowable operating pressure (MAOP) from the date of origin.

That’s no easy task under any circumstances. Over a pipeline’s lifetime, records can be accidentally lost or destroyed, especially if the pipeline changed ownership over the years.

But consider this: More than half of America’s pipelines were installed prior to 1970—many as far back as the 1940s, in fact—and had been protected by a lenient “grandfather clause” that permitted historical documentation to be used to establish MAOP in place of material properties. That means they lack the kind of records that meet the rule’s “verifiable, traceable, and complete” requirement. Re-establishing MAOP is the only alternative, and it’s not cheap: It’s estimated that it will cost the industry $17 to $22 billion per year when you factor in pressure tests, in-line inspection, and direct assessment to verify materials and integrity. And that’s just for pipelines outside of high consequence areas (HCAs). In all, the Pipeline Hazardous Materials and Safety Administration (PHMSA) puts the total annual costs of the rule at $31.4 million.

Industry Impacts: Not Just Money

Aside from the considerable expense associated with it, the mega rule will generate enormous volumes of information—data that operators can use to meet regulatory tests, understand pipeline threats, and de-risk and improve their integrity management programs. The question is: what’s the best way to manage all of that data so operators can maximize its value?

The world’s digital transformation is providing an answer. Today, it’s easier than ever to digitalize, store, access, and analyze information—and to meet the reporting requirements of the mega rule. With compliance deadlines looming large—gas transmission operators only have until July 1, 2021, to develop procedures for completing the outlined actions—moving to a cloud-based application may be the only way to manage the data streams associated with mega rule compliance and meet the government’s strict timetable.

This wouldn’t be the first instance of the energy industry adopting cloud computing, of course. When the 2014 downturn in prices sent oil and gas companies searching for ways to improve efficiency, digital technology was often the answer. Companies that embraced machine learning and cloud applications have realized some decidedly down-to-earth benefits, and nearly continuous technical advances are bulking up results even more.

For example, the upstream sector has found cloud computing useful as a business continuity tool, capturing and documenting tribal knowledge then passing it along to the next generation of engineers and other experts. For midstream operators, machine learning enhances insight into the presence and severity of anomalies, improving the accuracy of dig programs. And across all sectors, the use of digital technology is reducing the number of people required to perform tasks and mitigating risk in the most hazardous aspects of fieldwork.

With those successes in hand, it stands to reason that regulatory compliance is the next area where digital transformation will have a substantive impact.

Technology for Better Compliance

Cognitive Integrity Management (CIM) is a Microsoft cloud application. That means it uses one of the world’s most trusted platforms, known for its comprehensive levels of security. By using CIM, operators can:

  • Identify and overcome data gaps that make complying with the mega rule more difficult or time-consuming. For example, the demise of the grandfather clause means operators need to produce up-to-date, detailed records that weren’t previously required. Lack of data, mistakes in datasets, data silos, and manual business processes can stymie operators’ efforts to understand and report on the true state of their pipelines. By normalizing historical data across vendors and tool technologies, CIM can provide an accurate and complete picture, making it easier to verify data for regulators.
  • Repurpose existing data from various applications into a centralized management tool.
  • Incorporate enterprise level reporting and analysis across the entire integrity management business process, to stay on top of updated mega rule mandates.
  • CIM constantly updates reporting standards based on industry best practices.
  • Meet requirements for maintaining records that are reliable, traceable, verifiable, and complete.
  • CIM provides a centralized database that can call up information as it is required.
  • Safeguard their data.
  • Technology adds a layer of quality assurance and control with automated, real-time updates.

There is no other solution that provides the same level of detail as CIM.

A Winning Solution

On the face of it, the mega rule’s reporting requirements may seem somewhat taxing. But the truth is, complying not only supports a safer industry, it provides operators with more clarity into their pipeline systems than ever before. In other words, it’s a win all around. And with cloud applications bringing data management down to size, it can actually be an easy win.