For natural gas pipeline developers hunting for a good deal on a 100-mile section of steel pipe, a recent advertisement claimed to have just what they are looking for.
Following the cancelation of the proposed Constitution natural gas pipeline in Pennsylvania and New York, a private equity firm recently offered a "massive inventory" of never-used, "top-quality" coated steel pipe.
What the company didn't mention is that the pipe may have sat, exposed to the elements, for more than a year, a period of time that exceeds the pipe coating manufacturers' recommendation for aboveground storage, which could make the pipe prone to failure.
Long term, aboveground pipe storage has become commonplace as pipeline developers routinely begin construction activity on pipeline projects before obtaining all necessary permits and as legal challenges add lengthy delays.
Whether canceled or stalled, overdue oil and gas pipelines across the country may face a little-known problem that raises new safety concerns and could add additional costs and delays.
Fusion bonded epoxy, the often turquoise-green protective coating covering sections of steel pipe in storage yards from North Dakota to North Carolina, may have degraded to the point that it is no longer effective. The coatings degrade when exposed to ultraviolet radiation from the sun while the pipes they cover sit above ground for years.
The compromised coatings leave the underlying pipes more prone to corrosion and failures that could result in leaks, catastrophic spills or explosions. Degraded coatings were implicated in an oil spill from a failed pipeline near Santa Barbara, California in 2015. Toxic compounds may also be released as the coating breaks down, raising concerns that the pipes could pose a health threat to those who live near the vast storage yards holding them.
"There are pipelines being built all over the place and it doesn't seem like anyone is keeping close track of what the status is of the coatings," said Amy Mall, a senior advocate with the Natural Resources Defense Council. "There are a lot of unknowns here and yet we're relying on the coating to protect landscapes and communities from massive explosions."
'No Longer Acceptable'
The National Association of Pipe Coating Applicators, an industry group, states that "above ground storage of coated pipe in excess of 6 months without additional ultraviolet protection is not recommended."
However, photographs and satellite images suggest pipe sections for the Constitution Pipeline may have been stored aboveground without ultraviolet protection for more than a year before they were covered in "whitewash"—common household paint—that shields their coatings from the sun.
Pipeline safety experts question whether the pipe is still safe for use as part of a natural gas transmission pipeline.
"If they are going to sell it and use it for line pipe for natural gas, then they need to go back and do extensive testing on it before they put it in," said Richard Norsworthy, an industry consultant for pipeline coatings and corrosion control.
Sections for the long-delayed Keystone XL Pipeline, which would carry tar sands crude oil from Hardisty, Alberta to Steele City, Nebraska, may be in even worse condition. The pipes have been stored outside with only partial whitewash cover for nearly a decade.
TC Energy, which owns the pipes, inspected a small sample of them in 2018 and published what they found earlier this year in Corrosion Management, an industry journal. Environmental advocates say the findings are cause for concern. Company engineers analyzed 12 sections of pipe for the proposed pipeline that were stockpiled in Little Rock, Arkansas and were exposed to sunlight for up to 9 years.
The 80-foot pipe sections were coated with acrylic, water-based whitewash. However, several feet at the ends of each pipe were not covered to avoid hiding identification markings stenciled onto the pipe, the report said. It concluded that the green protective coatings on areas that were not whitewashed "completely failed to retain their original properties and attributes."
Those properties and attributes include things like coating thickness, flexibility, absorption capacity and the ability to adhere to the underlying steel pipe. Their purpose is simple; they keep the underlying steel from rusting.
If even a portion of the coating wears away, cracks, allows water to permeate it, or fails to stick to the pipe, water contacting the pipe's bare steel can cause it to rust. If enough rust forms on the pipe the steel can thin to the point that it forms a hole or rupture, spilling oil or leaking gas that can explode.
"You don't have to be a specialist to read that and see that it's saying that all those ends of those pipes that weren't coated with whitewash were total failures," Bill Kitchen, an environmental advocate in Johnstown, New York, said of the Corrosion Management study.
Portions of the pipe that were covered in whitewash had thicker protective coatings that adhered more closely to the underlying steel, yet failed another key test, according to the study. The pipe coating's flexibility, which prevents the coating from cracking, was "adversely affected to the point where the coating was no longer acceptable," it said.
Coating flexibility is crucial for pipes as they can be lifted and set down more than a dozen times as they are moved before being buried underground.
"When they pick that pipe up, no matter how they pick that pipe up, it's going to flex," said Norsworthy. "And when it flexes, it cracks," he said of degraded pipe coating that would not pass flexibility tests.
Coating failures can lead to pipeline failures, as was the case in May 2015 when 123,000 gallons of crude oil spilled near Santa Barbara after a steel pipe ruptured.
The Pipeline and Hazardous Materials Safety Administration (PHMSA), the federal agency that regulates oil and gas pipelines, concluded the spill was caused by "external corrosion that thinned the pipe wall to a level where it ruptured suddenly." The agency found that "the condition of the pipeline's coating and insulation system fostered an environment that led to the external corrosion," although, in this case, the coating hadn't been degraded by exposure to sunlight.
Significant failures in pipelines transporting gas, oil and other hazardous liquids are increasing, with one fifth of all failures due to corrosion, according to a recent assessment of government data by the Pipeline Safety Trust, a watchdog group.
TC Energy declined to comment. The Corrosion Management study stated that TC Energy started "an inspection and remediation programme" in August 2018.
In June 2019, PHMSA issued a notice of probable violation to TC Oil Operations, a subsidiary of TC Energy, after realizing a related safety concern involving a pipeline that is already in operation. The company used fusion bonded epoxy, the same coating that should not be stored exposed to ultraviolet light from the sun for more than six months, on multiple, permanently above ground sections of the original Keystone pipeline, which was completed in 2010.
The company received an order in February giving it six months to "correct deficiencies in coating material" and provide a record of the location and date that an "appropriate coating" was applied. TC Energy complied with the order and the case is now closed, according to a letter PHMSA sent to the company on Sept. 29.
PHMSA would not say how the problem was remediated or what additional coating was applied. Using the pipe aboveground will lead to degradation of its protective coating. However, corrosion is less of a concern for above ground pipelines than those buried underground because the pipe is less likely to be surrounded by water, said Richard Kuprewicz, an independent pipeline safety expert.
More Testing Is Needed
To gain a better understanding of the safety concerns posed by long term aboveground storage, experts say more testing is needed.
The majority of stored pipe is unlikely to have significant UV exposure as pipe sections are typically stacked on top of each other in storage yards with only the top and outermost sections of pipe exposed. The Corrosion Management study, which found pipe coating exposed to sunlight for close to 10 years was no longer acceptable, estimated that approximately 20 percent of the Keystone XL pipes stored in Little Rock received significant exposure to ultraviolet radiation. However, the study only looked at 12 out of 24,000 sections of Keystone XL pipe at the Little Rock storage yard.
"The very small sample size tested does not give a real picture of what is happening," said Norsworthy, the consultant. "For me to be comfortable, they probably have to [test] something like one out of every 100 [pipes]."
Kuprewicz, the pipeline safety expert, said the degradation caused by UV light is not necessarily a fatal flaw but is cause for concern.
"Anything that can cause the coating to deteriorate and prevent it from doing its function is a concern," Kuprewicz said. "However, it's only one part of corrosion protection."
Kuprewicz said pipeline operators can also use "cathodic protection," a weak electric current that changes the electrochemistry of the surrounding environment, raising the pH to make any water in contact with the steel pipe less corrosive.
Additional current would have to be added if pipe coatings are deteriorated. Such efforts would add additional project design and operational costs, and potentially added risk, Kuprewicz said.
"Cathodic protection is meant to supplement the [protective] coating, it isn't meant to replace it," Kuprewicz said.
Pipes are Exposed, but Information About Them is in a 'Black Box'
As pipeline projects across the country face increasing legal challenges and construction delays, long-term aboveground storage of pipe sections are not limited to the Keystone XL and Constitution pipelines. Yet basic information is scant on how long pipe has been stored above ground; what, if any, measures developers took to protect the pipe from the elements, or what condition the pipe is in .
"There is such poor inspection and disclosure of what is going on," said D.J. Gerken, program director for the Southern Environmental Law Center in Asheville, North Carolina. "It's a black box."
PHMSA requires that all oil and gas pipelines have protective coatings and use cathodic protection but the agency does not typically monitor how long pipe sections are stored above ground. One exception, however, was the Atlantic Coast Pipeline (ACP), a now cancelled project that would have transported natural gas from West Virginia to North Carolina.
The agency took a closer look at pipe sections for the project in November 2017, one year after they were first stored above ground, and reported no signs of coating degradation. However, data obtained through a public records request suggests otherwise.
In the fall of 2017, PHMSA oversaw third party inspection of pipe coating at six ACP storage yards across Virginia, West Virginia and North Carolina. The testing looked for chalking, a sign of coating degradation. Inspections in late 2017 and early 2018 showed "slight chalking" in the protective coating of the majority of pipes assessed.
"It was worrisome to me that the pipes were out in the sun and are still out in the sun," said William Limpert, a retired state environmental regulator who until recently owned land along the route of the now canceled ACP pipeline.
Limpert received a letter from the agency in June 2018 stating there was "no evidence of degradation of the pipeline protective coating."
It was "completely opposite of what the pipeline inspections show," said Limpert, who acquired the actual test results one year later through a records request. "As far as we know they haven't done anything to prevent further degradation and they were degrading that long ago."
Limpert was also concerned that PHMSA did not include a flexibility test of the pipeline coating. An industry study from 2000 assessed the impact of ultraviolet light on the protective coating of a natural gas pipeline in Canada, finding that "the most severe influence was noted on the marked reduction in flexibility."
Industry standards set by the National Association of Corrosion Engineers recommend flexibility tests for coatings. Pipeline developers do not have to follow the guidelines, but there could be legal implications if a company were to use pipe that didn't pass all of the recommended tests, Kuprewicz said.
After years of delay and rising costs, Dominion Energy and a project partner, Duke Energy, canceled the Atlantic Coast Pipeline on July 5. Dominion is now determining its long-term plan for the unused pipe, said Ann Nallo, a spokesperson for the company.
"I think there is a lot of reason to be worried and a lot of reason to be concerned that this pipe doesn't then find its way to another storage yard waiting to be used for another pipeline without being retreated and reinspected," said Gerken, of the Southern Environmental Law Center.
State health officials in Virginia and North Carolina have also expressed concern about potential health impacts of pipeline coating degradation for those who live near vast pipeline storage yards.
In March 2019, the heads of the Virginia Department of Health and the Virginia Department of Environmental Quality sent a letter to the Federal Energy Regulatory Commission (FERC) noting that epoxy resins similar to the coating used in the proposed Atlantic Coast and Mountain Valley pipelines can release benzene and styrene, carcinogens that are produced as the coatings degrade.
The agencies requested information on the possible public health and environmental impacts from long-term above ground storage. Dominion commissioned a toxicity assessment at one of its storage yards but found "no impact on human health or the environment from the chalky residue."
However, the North Carolina Department of Health and Human Services criticized the methodology of the report and its findings and asked that FERC require the pipelines' developers to provide additional information. The U.S. Centers for Disease Control's Agency for Toxic Substances and Disease Registry (ATSDR) also reviewed the test results but determined the "sampling data are not sufficient for ATSDR to fully evaluate the public health concerns." A second test commissioned by Dominion also found no adverse health or environmental impacts.
"The pipe coating has no impact on human health or the environment," said Nallo.
Yet, the Dominion-funded tests have failed to put to rest concerns about the pipes's environmental safety, Limpert said. Limpert said the additional testing is also flawed and has asked FERC to conduct an independent expert review.
On Oct. 8, FERC responded to health officials in Virginia and North Carolina, saying it had reviewed the issue and found no environmental health concerns related to coating degradation at pipe storage yards.
Limpert said he would still like to see a separate review by an independent, expert agency.
"It's possible that there are no negative environmental or public health impacts from the coating, but it would be nice to know that for sure," he said.