Decommissioning of Pipelines and Related Facilities - Proposed Amendments to the Onshore Pipeline Regulations, 1999 and National Energy Board Processing Plant Regulations-Proposed Decommissioning Exemption Order

To: All Pipelines and Processing Plants under the National Energy Board Jurisdiction

Decommissioning of Pipelines and Related Facilities
Proposed Amendments to the Onshore Pipeline Regulations, 1999 and National Energy Board Processing Plant Regulations
Proposed Decommissioning Exemption Order

On 5 February 2003 the Board solicited comments on a proposal to amend the Onshore Pipeline Regulations, 1999 to include provisions regarding decommissioning and to establish a Decommissioning Exemption Order¹ to exempt certain activities from the requirement to file decommissioning applications. The Board has considered the comments from Enbridge Pipelines Inc., the Canadian Association of Petroleum Producers and the Canadian Energy Pipeline Association.

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1 In the original letter this was referred to as the Decommissioning Streamlining Order. In order to avoid confusion with the section 58 Streamlining Order, the Board proposes to refer to this as the Decommissioning Exemption Order.

The Board is of the view that many of the suggestions put forward could best be addressed in guidance notes to the regulations, or in an Exemption Order. Both of these instruments can be easily amended to adjust for changing situations, and can provide for more description and explanation than can regulations. The Board agrees with the comments by CEPA that a discussion with industry would be highly beneficial and would like to hold these discussions before proceeding any further to finalize the Decommissioning Exemption Order and guidance notes. Therefore, the Board is adding the matter of decommissioning to the agenda for the NEB Workshop to be held December 2-4, 2003. Further information on the Workshop will be forwarded to you under separate cover. Should you find that the time allotted for discussion at these sessions is insufficient, the Board would be pleased to hold further meetings.

The Board is proposing that the changes also apply to the National Energy Board Processing Plant Regulations. Given that the process for amending regulations takes a considerable amount of time, the Board will start the procedure for amending both sets of regulations by sending the attached amendments to the Department of Justice for its review. All parties will be given an opportunity to comment on the amendments when they are published in the Canada Gazette, Part I. The Board will also make amendments as needed as a result of discussions with industry.

If you have any questions, please do not hesitate to contact Board Counsel, Margery Fowke at 403-299-3937 or mfowke@neb-one.gc.ca or Marian Yuzda at 403-299-3643 or myuzda@neb-one.gc.ca.

"decommission" means the permanent cessation of the operation of a pipeline without discontinuance of service.

"abandon" means the permanent cessation of the operation of a pipeline which results in the discontinuance of service.

45.1 (1) If a company proposes to decommission the pipeline or a section thereof, the company shall submit an application for the decommissioning to the Board.

(2) The application shall include the rationale for the decommissioning and the measures to be employed for the decommissioning.

2. Subject to section 3, these Regulations apply to onshore pipelines designed, constructed, operated, decommissioned, or abandoned after the coming into force of these Regulations.

4. (1) When a company designs, constructs, operates, decommissions or abandons a pipeline, or contracts for the provision of those services, the company shall ensure that the pipeline is designed, constructed, operated, decommissioned or abandoned in accordance with the applicable provisions of....

(2) Without limiting the generality of subsection (1), the company shall ensure that the pipeline is designed, constructed, operated, decommissioned or abandoned in accordance with the design, specifications, programs, manuals, procedures, measures and plans developed and implemented by the company in accordance with these Regulations.

7. For the purposes of these Regulations, the Board may require a company or person to submit a design, specification, program, manual, procedure, measure, plan or document to the Board if...

(b) the Board receives any information that the design, construction, operation, decommissioning or abandonment of a pipeline, or any part of a pipeline, is or may cause....

52. (1) A company shall immediately notify the Board of any incident relating to the construction, operation, decommissioning or abandonment of its pipeline and shall submit a preliminary and detailed incident report to the Board as soon as is practicable.

53. (1) A company shall conduct an audit and an inspection on a regular basis to ensure its pipeline is designed, constructed, operated, decommissioned or abandoned in compliance with....

"decommission" means the permanent cessation of the operation of a pipeline without discontinuance of service.

"abandon" means the permanent cessation of the operation of a pipeline which results in the discontinuance of service.

43.1 (1) If a company proposes to decommission its processing plant, the company shall submit an application for the decommissioning to the Board.

(2) The application shall include the rationale for the decommissioning and the measures to be employed for the decommissioning.

3. The duties imposed on a company under these Regulations are duties in respect of a processing plant that is designed, constructed, operated, decommissioned or abandoned by the company.

4. A company shall ensure that its processing plant is designed, constructed, operated, decommissioned or abandoned in accordance with the provisions of...

5. A company shall ensure that its processing plant is designed, constructed, operated, decommissioned or abandoned in accordance with the designs, specifications, programs, manuals, procedures, measures and plans developed and implemented by the company in accordance with these Regulations.

7. The Board may order a company to submit to the Board within a specified period a design, specification, program, manual, procedure, measure, plan or document if...

(b) the Board receives any information that the design, construction, operation, decommissioning or abandonment of the company's processing plant, or a part of it, is or may cause...

9. (1) A company shall develop a program for the design, construction, operation, decommissioning and abandonment of pressure vessels and pressure piping at its processing plant and shall submit the program to the Board prior to implementation.

10. A company shall develop, implement and maintain quality control and quality assurance programs in respect of the design, construction, operation, decommissioning and abandonment of its processing plant.

15. (1) If a company contracts for the provision of services in respect of the construction, operation, decommissioning or abandonment of its processing plant, the company shall

(a) inform the contractor of all conditions or features that are special to the construction, operation, decommissioning or abandonment; ...

(c) take all reasonable steps to ensure that the construction, operation, decommissioning or abandonment activities are conducted in accordance with the manuals developed under sections 27 and 30; and

(d) authorize a person to halt a construction, operation, decommissioning or abandonment activity in circumstances where, in the person's judgment, the construction, operation, decommissioning or abandonment activity is not being conducted in accordance with the manuals developed under sections 27 and 30 or is creating a hazard to the safety of anyone at the construction, operation, decommissioned or abandonment site.

46. A company shall immediately notify the Board of any incident relating to the construction, operation, decommissioning or abandonment of its processing plant and shall submit to the Board a preliminary incident report as soon as practicable and a detailed incident report as soon as practicable.

52. (1) A company shall conduct audits and inspections on a regular basis to ensure that its processing plant is designed, constructed, operated, decommissioned or abandoned in compliance with....

53. (1) When a company constructs, operates, decommissions or abandons a processing plant, the company or its agent or mandatory shall inspect the construction, operation, decommissioning or abandonment to ensure that the requirements of these Regulations are met and that the terms and conditions of any certificate or order issued by the Board are complied with.