WRITTEN STATEMENT OF CARL T. JOHNSON
ADMINISTRATOR
PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION
U.S. DEPARTMENT OF TRANSPORTATION
BEFORE THE
COMMITTEE ON ENERGY AND COMMERCE
SUBCOMMITTEE ON ENERGY AND AIR QUALITY
UNITED STATES HOUSE OF REPRESENTATIVES
March 12, 2008

Chairman Dingell, Ranking Member Barton, members of the Committee, thank you for the opportunity to appear today. I am pleased to discuss the progress of the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration (PHMSA) in advancing safety, since the passage of the Pipeline Inspection, Protection, Enforcement and Safety (PIPES) Act in December, 2006. I am Carl Johnson, the new PHMSA administrator. Accompanying me is Stacey Gerard, Chief Safety Officer and Assistant Administrator of PHMSA.

As quickly as the months have passed for PHMSA since enactment of this important program reauthorization, I realize the months remaining in my term are passing even more quickly, and I am committed to make this a great year for PHMSA. We will continue to accomplish the most important safety priorities and realize our agency potential to provide the most critical protections for the American people while our nation's reliance on the safe transportation of energy and hazardous materials increases. I must take this opportunity to say that your commitment to completing the timely reauthorization of the national pipeline safety program enormously increases our chances of success.

The enormity of PHMSA's mission ¿ its complexity and reach into the lives of every citizen ¿ makes it imperative that we are positioned to be successful. Just last month, the President forwarded to Congress the FY 2009 budget, the first budget PHMSA prepared since the passage of the PIPES Act. This budget frames our plan to get the resources needed to address the pipeline safety challenges the nation faces and that the PIPES Act recognizes. The resources requested will help us meet the intent of Congress to help provide states with more resources for oversight of the entire 1.9 million miles of infrastructure under their jurisdiction, help all pipeline safety stakeholders reduce damage to pipelines and help PHMSA build the capability to inspect and enforce to the full extent needed.

The recent completion of the ambitious PHMSA Strategic Plan, signed off by my predecessor and now Deputy Secretary of Transportation, Admiral Thomas Barrett, drives not only our budget request, but virtually all the actions of the agency. This Plan makes our job easier. It focuses on building our capability to make best use of information to drive down risk and guides the decisions we make ¿ not only to improve the performance of PHMSA, but the entire hazardous materials transportation system. PHMSA strives to be a model agency ¿ one that inspires confidence in our stakeholders because we have a risk-based rationale to guide our work that is transparent, meaningful, and easy to understand.

I believe we are doing just what we have promised in our Strategic Plan. Since the passage of the PIPES Act, we are making better use of information to improve safety. Perhaps most importantly, we have improved our ability to investigate safety issues ¿ not just incidents, but the first indication of safety concerns. It is a priority for us to put more resources into investigations, preparing all our inspection and enforcement staff to understand the concept of root cause of pipeline failures and revamping our inspection and enforcement efforts to be even more effective.

Improvements of our investigative process have proven critical, for example, in guiding our oversight of all pipeline infrastructure in Alaska. We have been increasing our resources in Alaska and stepping up efforts to assist the state through the Petroleum Systems Integrity Office and the Joint Pipeline Office. This assistance includes directly delivering training from our Transportation Safety Institute, sharing data bases and information systems, and facilitating the inclusion of Alaska officials in meetings with other states through the National Association of State Pipeline Safety Representatives. Making better use of information guides all our actions. Most importantly, it guides our targeting of inspections and leads us to put special emphasis on operators whose performance need particular improvement. We work with companies to identify areas of concern and determine the appropriate level of effort needed for remediation. We have been particularly challenged this year working to respond to integrity issues for several pipelines of strategic importance to our national fuel supply which have experienced failures. Investigation is necessary to determine the extent to which the cause of failure is systemic and what is necessary to restore safe operations.

Unfortunately, there have been incidents this past year, in Mississippi, Minnesota, Louisiana, Texas and California, sometimes caused by problems that are not easily remedied. I am sad to say that six people tragically lost their lives. More fortunately, our work with technology to advance operators' abilities to improve integrity, including the assessment of non-piggable pipelines, has achieved important results. Despite these incidents noted, the record in pipeline safety is good. Over the past 20 years, all the traditional measures of risk exposure have been rising ¿ population, energy consumption, pipeline ton-miles. At the same time, the number of serious pipeline incidents ¿ those involving death or injury ¿ has declined by an average of ten percent every three years. This is "no accident." It's a reflection of aggressive programs to reduce risk and protect the public. We aim to continue this long-term trend.

[Chart "Pipeline Safety Context Measures" available on Page 2 of the attached PDF.]

We hope that the success of integrity management programs will continue to drive down the number of serious pipeline incidents and will help us make important inroads in greater safety in distribution systems. In fact, we believe this approach can benefit the entire hazardous materials transportation system.

We routinely examine operators' safety performance and identify what factors in companies' operations make the difference in improving their records. Further, we review the impact of different regulatory programs on safety in other industries. We inevitably come to the conclusion that individual corporate executives' commitment to safety and their effective management of information to drive down risk are critical. As a result, when we take action with an individual company with a poor performance record, we have begun to institute additional management requirements to help build a better "safety culture." At the same time, at the national level, in our work with trade associations, we are promoting focus on safety culture as a way to improve performance. At the national level, our efforts are intended to inspire improved performance ¿ we are not considering regulating "safety culture." On an individual, remedial basis, however, we get more prescriptive. We detail how the company needs to create an environment in which risk information is brought forward and rewarded, how risk information is managed and tracked, and what is the adequate scientific basis for assessing and deciding how risk and control are measured. We are concerned about the transparency of this process and how safety and profitability values are balanced.

Helping communities deal with pipeline safety has been a priority of the past year as well. Of course, PHMSA always has at the top of our list of concerns using the best information available to guide our damage prevention efforts. Working with the Common Ground Alliance and all the underground damage prevention stakeholders, we target for assistance those states whose risk of construction related damage is the greatest or those states in which the potential for improvement is real. Among the program efforts of the past year is a stakeholder-driven collaboration on guidance, known as the Excavation Damage Prevention Initiative (EDPI) effort, to help states achieve full implementation of the "Nine Point Damage Prevention Program" codified in the PIPES Act. This guidance explains to state agencies what is intended in the "nine point program" and how to get there. We are putting representatives in the field to help explain the benefits of the program. We have also invested in a pilot research effort in Virginia to test ways of improving excavation location and communications technology so that the one call notification system is more accurate, works faster, and contributes to a safer work place. And of course, we have supported educating the public on the importance of calling 811, to help prevent damage to pipelines during an excavation. Pipeline operators believe that this number is effective in preventing damage to their facilities, and many are voluntarily adding this number to their permanent pipeline markers.

There are other ways to help communities live safely with pipelines. One of the most important of these is guiding communities to make safe land use decisions. Building on the model of the Common Ground Alliance, in the past year we have called stakeholders together in a similar model, called Pipeline and Informed Planning Alliance (PIPA). This is a follow-up activity to a mandate of the Pipeline Safety Improvement Act (PSIA) of 2002, and results from a recommendation by the Transportation Research Board.

A companion effort is helping communities understand where pipelines are located, who owns and operates them, and what other information is available for community planning. Following the passage of the PIPES Act, PHMSA worked with the Department of Homeland Security/ Transportation Safety Administration to resolve concerns about security sensitive information. Vital information that communities need for land use, environmental and emergency planning around pipelines is now publicly available through PHMSA's National Pipeline Mapping System (NPMS). We continue to work with states, industry and other stakeholders to make the NPMS information more accurate and more useful. Additionally, we have completed a review of thousands of operators' public education programs and provide operators with feedback.

As the nation realizes the need to work toward the President's goal of reduced oil consumption over the next ten years, several different opportunities surface for PHMSA, and they confront us with unexpected urgency. The first is the challenge associated with managing a new set of products with properties we have not managed on a large scale in pipeline transportation ¿ products like ethanol, hydrogen, carbon dioxide and potentially other biofuels. Some of these we are familiar with, but we expect the scale of operations to grow. Others, like ethanol, bring new technical issues we really have not confronted to the extent now contemplated. The second challenge is the need to increase the reliability of the infrastructure in place and, if possible, to get more capacity from it ¿ more throughput. Thirdly, we face a pipeline building boom for the first time in decades, bringing the challenge of new designs, new materials, and new technologies to review and hopefully find acceptable. In FY 2007, PHMSA spent 14 percent of its field inspection time overseeing new construction, compared to 2 percent the prior year.

Another challenge is the need to work with the communities through which these products will be transported and help them understand the need for these products, the benefits they provide, the protections in place, and most importantly, how to respond to them in the event of an incident. Pipeline operators, in particular, have moved quickly to be ready to transport large volumes of ethanol, either in existing pipelines, retrofitted and dedicated to ethanol service, blended with other petroleum products or in batches, or in new pipelines designed for the purpose. Ethanol poses very unique emergency response challenges, and PHMSA is responsible for helping communities prepare.

While we always work to set standards for safe transportation, we also work to remove impediments and any unnecessary regulatory overlaps. Our concern is less "if" these new products can be moved safety, but "how" can they move safely, and how can we contribute to making it happen easier and sooner. There are many opportunities we see for harmonizing regulatory approaches to simplify the program logic for the industry ¿ to examine what various regulatory structures try to achieve, where there are gaps, where there are overlaps and where there are occasions to simplify. Essentially, we would like to have "one plan" that works to meet similar objectives with one approach to assess risk, prioritize risk control and evaluate effectiveness. We have been testing this concept in Alaska as we work with state and federal agencies to plan for improved safety performance in the future. The model of the Joint Pipeline Office certainly has bearing on broader Alaska pipeline operations and applications for the Alaska Gas project, on which we have design review responsibility already. We think there are broader opportunities for simplification to a policy of "no gaps, no overlaps" in other areas of PHMSA responsibility.

Another challenge for PHMSA is hiring and maintaining qualified pipeline engineering staff. It is taking us longer to fill vacancies, however, we are on track to fill our vacancies in 2008. There is a pipeline construction boom happening at the same time many individuals are retiring. Industry is competing for the same talent. To meet this challenge, PHMSA is implementing new ways of attracting talent, including remotely deploying employees at regional locations where they can telework and address issues directly in the field.

We have worked hard to step up to all these challenges. We notified the public of our intent to regulate these new products, if we weren't already regulating them. We continue to work with individual operators, identifying safety concerns that must be satisfied, both with the infrastructure and with the surrounding community. We work with other federal agencies to think about the transportation implications from the inception of marketing new fuels, as part of a systemic planning process. We work with other countries to benefit from their experience. We collaborate with the pipeline industry, the renewable fuels organizations, and others like emergency responder organizations and the National Commission on Energy Policy, to investigate and solve technical challenges.

Consistent with these efforts, PHMSA has investigated safety issues involved in allowing existing or proposed natural gas transmission pipelines to operate at higher pressure. Based on extensive examination by PHMSA, we have determined that improved technology in metallurgy and pipe manufacture, and improved pipeline life cycle management practices now give us the opportunity to ease supply constraints by allowing pipeline operating pressure to increase enough to boost capacity by as much as 10 percent. Increasing capacity also enhances pipeline efficiency. Higher operating pressures are consistent with practices in Canada, the United Kingdom and others.

We evaluated requests for special permits from companies seeking to operate existing or proposed pipelines at higher pressure. In granting the requested special permits, we required operators to demonstrate compliance with certain design specifications and imposed conditions requiring adherence to additional safety standards. In addition to allowing public comment on the requests for special permits, PHMSA held a public meeting and brought stakeholders into the development of the permitting criteria. As a result, PHMSA just proposed revising regulations to allow increased capacity. This will encourage the use of newer pipeline materials and associated safety standards, resulting in a net positive effect on overall pipeline safety.

While PHMSA has the ability to make regulatory changes benefiting natural gas transmission pipeline capacity, there is not an immediate pathway available to relieve constriction on oil pipelines. Consistent with the authorization in the PIPES Act, PHMSA is working with the Department of Energy and the Department of Homeland Security to develop an approach to investigation of "chokepoints" in the oil pipeline transportation system. We are scoping out an approach to modeling "what if" scenarios and the consequences of disruptions.

Any accident or incident poses a potential disruption to the delivery of energy supplies. While safety is always first, we are keenly aware of the need for reliable energy supply in the U.S. as well. We work closely with industry and our state partners to help safely restore service after a hazardous liquid pipeline accident, and 95 percent of the time this has been achieved within seven days. With integrity management programs improving our understanding of pipeline condition and new technology available with more accurate diagnostic capabilities we can expedite the process to make sure these systems are safe to operate. In this way, we help make sure energy products are delivered not only safely but reliably.

[Chart "Energy Reliability: Time to Restore Service" available on Page 7 of the attached PDF.]

There are many aspects to the PIPES Act provisions and intents. Section 6 of the PIPES Act requires PHMSA to provide monthly updated summaries to the public of all enforcement actions and provide a mechanism for operators to make responsive information available to the public. This emphasis on enforcement programs, and particularly the need to make more transparent to the public the vigor and comprehensiveness of our enforcement efforts, is a high priority to PHMSA. In the year since the passage of the PIPES Act, PHMSA engaged in an intensive and productive pipeline enforcement period. We are very proud of these efforts and believe that they reflect a shared commitment by Congress, the Administration, and DOT to use the full range of civil and criminal enforcement tools under the Federal Pipeline Safety Laws to maintain a safe and reliable oil and gas pipeline transportation system.

On May 1, 2007, PHMSA rolled out its new enforcement transparency website, eight months ahead of the schedule set in the PIPES Act. This enforcement information can be found at (http://primis.phmsa.dot.gov/comm/reports/enforce/Enforcement.html).

While the PIPES Act requires us to post monthly summaries, we have chosen to do more. We do not merely post summaries of our enforcement actions. We provide access to copies of the actual enforcement documents filed by PHMSA and the operators' responses. We provide a brief narrative describing how each part of our enforcement process works, the penalties assessed, and the recent enforcement history of operators. All of this data is searchable by year, type of action, and other factors. The project is still in its infancy, and the history available and quality of the project will only improve with time.

We made this extra effort and went beyond the requirements of the Act. Transparency in the enforcement process provides notice to the industry as to what sort of regulatory violations we consider serious, what types of enforcement actions such violations are likely to evoke from PHMSA, and what the costs of non-compliance are likely to be. We believe this is already leading to improved performance. Transparency also alerts the public as to what we are doing as public servants, what the compliance performance of operators has been, what progress is being made, and where this agency needs to improve. We subscribe to the theory that transparency, when coupled with useful and reliable data, will lead to self-correcting behavior, both on the part of the regulated community and on the part of government itself.

We have been impressed but not surprised with the response we have received to this transparency initiative. We are currently seeing 800 "hits" per day on the website from non-DOT sources ¿ from industry, local governments, and interested citizens. The website is also making us, as a government agency, more vigilant in making sure that our enforcement efforts are legally sound, that we are treating all operators fairly, and that the penalties we impose are commensurate with the impact of incidents and violations from which they arise.

As to the vigor of PHMSA enforcement, we initiated 259 pipeline enforcement actions in 2007, the second highest number since 2002. Seven of these involved corrective action orders (CAOs) issued in response to incidents causing fatalities or serious injury, hazardous liquid spills that damaged the environment, or other conditions posing serious threats to public safety or the environment. When serious incidents occurred, we responded immediately to the scene, ordered the operator to reduce the operating pressure of their lines or shut them down completely until remedial action could be taken.

The number of CAOs to which operators have satisfactorily responded, completing the compliance actions required by PHMSA, and allowing the agency to close the cases, has been increasing steadily since 2002. In that year, only two CAOs were completed and closed, as opposed to 14 in 2007. In each case, a hazardous facility has been made safe to operate.

PHMSA continues to make full use of its penalty authority. In 2007, PHMSA proposed civil penalties of $4,288,800, a 39 percent increase from 2006 and the second highest amount since 2002.

Continuing to take advantage of the full range of enforcement tools available to us, we opt for our best prosecutorial weapon. In July 2007, PHMSA and the Department of Justice announced the settlement of a civil action against El Paso Pipeline Company, arising out of a tragic incident near Carlsbad, New Mexico, in which 12 people were killed. This settlement was reflected in a judicial consent decree that included a civil penalty of $15.5 million and injunctive relief worth $86 million. This case represents the largest judicial settlement ever brought under the Federal Pipeline Safety Laws.

The most intensive enforcement effort PHMSA undertook since the passage of the PIPES Act has been our work in Alaska. The 2006 BP oil spills on Alaska's North Slope demonstrated the vulnerability of this environmentally sensitive area to major oil spills and the country's vulnerability to disruptions in critical supplies of crude oil from Alaska. It also focused extensive media attention on the need to strengthen environmental and safety oversight of the entire oil and gas industry in Alaska. As a result of these incidents, PHMSA has taken the lead in trying to forge a new regulatory and enforcement partnership, based on the concept of "One Plan," to meet the needs of various state and federal agencies.

As part of this work in Alaska, PHMSA has issued a CAO and three Amendments against BP to correct systemic problems in its pipeline system on the North Slope. As reflected in these orders, BP committed to the $260 million replacement of 16 miles of oil transit lines where the 2006 failures occurred. We signed a letter of intent with the State of Alaska Department of Natural Resources to improve state-federal cooperation in the oversight of the oil and gas pipeline industry throughout the state. We provided technical assistance to the U.S. Attorney for Alaska and the Environment and Natural Resources Division of the Department of Justice in their prosecution of a criminal case against BP, in which the company pled guilty to criminal negligence related to the maintenance of the Prudhoe Bay oil transit lines in November 2007. In that case, BP agreed to pay a penalty of $20 million for the 2006 spills.

PHMSA issued several enforcement actions against Alyeska Pipeline, the owner of the Trans-Alaska Pipeline System (TAPS) including a Notice of Probable Violation, with a proposed penalty of $817,000 for alleged safety violations relating to a pump station fire, inadequate cathodic protection, and other safety issues that threaten the integrity and reliability of this critical infrastructure.

As our regulatory focus has changed, so has our enforcement focus. It is becoming increasingly complex and innovative. Our work in Alaska is just one example where we "think outside the box" to devise enforcement solutions that better comport with the agency's rising safety goals. It means that we must forge new relationships among regulatory agencies and other stakeholders, such as the one we're building in Alaska, to design solutions that fit the circumstances. We are undertaking enforcement actions that seek to help instill a genuine "safety culture" within companies that have demonstrated a "tin ear" to placing safety first. We strive to be leaders in this effort. We do use our full range of enforcement options to encourage operators to do more than meet the letter of the law and to make our nation's pipeline system even safer.

Beyond our focus in the past year on enforcement transparency and vigor, we have been working on all the statutory mandates of the PIPES Act.

A noteworthy provision helps states with more resources for oversight of the entire 1.9 million miles of infrastructure under their jurisdiction and helps all pipeline safety stakeholders reduce damage to pipelines. The President's FY 2009 budget does make important strides to increase funding to state agencies, and our request would increase funding on average about 50 percent over prior year funding and get us much closed to the goal of reimbursing states up to 80 percent of their program costs. PHMSA is also striving to comply with the standard in the Act pertaining to the necessary level of inspection and enforcement personnel. Similarly, in the area of damage prevention assistance, we ask for and are providing additional resources to help states achieve performance of all nine program elements. We are very actively involved in advancing damage prevention efforts.

PHMSA is also addressing all the additional requirements in the reauthorization. There are three significant regulatory mandates in the PIPES Act: 1) Distribution Integrity Management (DIMP), including excess flow valves (EFVs); 2) Low-Stress Pipelines; and 3) Control Room Management, including the risk of fatigue and confidence in and adequacy of alarms. For each of these initiatives, PHMSA's regulatory actions are well developed, supported with thorough regulatory analyses, and at advanced stages of review.

Section 9 of the PIPES Act requires PHMSA to prescribe minimum standards for integrity management programs for distribution programs, including requiring operators to install EFVs in certain circumstances. We are gathering additional data and completing analyses to complete the requirements for mandating the installation of EFVs. We asked our state partners to remind operators of the deadline in the law and they are doing so. We are moving the DIMP proposal to publication, but getting ready for DIMP is a lot more than a rule. It takes a system ¿ and we built one. We have consensus standards, guidance, training, IT for data bases, and more resources for oversight. Getting 50 states to implement a performance standard takes a lot more preparation than preparing a single federal entity.

Section 4 of the PIPES Act requires PHMSA to issue regulations for low-stress hazardous liquid pipelines. This mandate required us to promulgate a supplementary notice beyond our original proposal. With that step completed, we are in the final stages of completing the first phase of a final rule to cover the low-stress lines that pose the highest consequence to the environment.

Section 12 of the PIPES Act mandated that PHMSA issue regulations requiring operators to develop, implement, and submit for DOT approval a human factors management plan to reduce risks associated with human factors, including a maximum limit on the hours of service for controllers.

Section 19 of the PIPES Act requires PHMSA to issue standards to implement National Transportation Safety Board recommendations concerning Supervisory Control and Data Acquisition (SCADA) operation, including: (1) use of graphics; (2) review and audit of alarms on monitoring equipment; and (3) pipeline controller training. We have completed necessary data gathering and analyses, and are rapidly moving that proposal to publication addressing both sections. PHMSA addresses Sections 12 and 19 through one rulemaking which will help controllers recognize and move quickly to act on abnormal events and mitigate their consequences.

In each of these projects over the past year, PHMSA found ways to strengthen our original concepts and added additional elements to the initiatives. Each of these projects has also benefited from public dialogue in the past year intended to enrich information available to us as we formulate the regulatory solutions.

Section 21 of the PIPES Act mandated PHMSA to evaluate leak detection technology and submit a report to Congress on the effectiveness of leak detection systems utilized by operators of hazardous liquid pipelines. PHMSA examined the issue, drafted a report and posted it for public comment at the end of last year. We are assessing the additional input and moving quickly to finalize the report. We have invested in several research projects intended to improve the sensitivity of leak detection technology, particularly for hazardous liquid operators. As we work on advancing this technology, we believe we have adequate oversight in place to evaluate the leak detection capability of individual operators and have exercised authority as needed to compel system upgrades where warranted. Our report is available on our website in draft while we complete the final editing to include public comments.

A long standing concern of the Committee is the issue of availability of public information on pipeline operations to the communities in which they operate. Section 5 of the PIPES Act requires PHMSA to award the first three community information technical assistance grants as demonstration grants, up to $25,000 each, for the purpose of demonstrating and evaluating the utility of the grants. We have been working with pipeline operators to develop concepts for this project which we could "pilot test". We see this initiative as a partnership between operators and communities. Our aim is to have communities identify information they need on operators' performance, to have operators make that information understandable, and hopefully to use that information to benefit the safety of the community. We asked operators to assist us with moving this project forward on a pilot basis, preparatory to grants. The results of these pilots will inform the criteria we would use more broadly.

We funded public viewing of two events sponsored by the Bellingham Trust. We are preparing to fund two professional associations of county and city government officials to represent the public interest in pipeline projects. We are encouraging them to increase public participation in a range of initiatives to protect pipelines and communities from risks, including but not limited to informing land use decisions near existing and new pipelines.

Section 13 of the PIPES Act requires PHMSA to issue rules for the use of safety orders as an additional option for addressing pipeline integrity threats. We are finalizing an interim final rule, that will be published shortly, establishing the procedural regulations for issuing safety orders and how notice and consultations will be provided. Operators will be provided with notice and opportunity for informal proceedings to determine the measures necessary to mitigate the concern. Once this enforcement option is available to us, we will be in a better position to ensure operators are addressing longer term conditions before they become immediate hazards. In keeping with our policy of transparency in all of our enforcement actions, all safety orders will be accessible to the public on our website.

I am committed to full implementation of the PIPES Act and the agency looks forward to achieving full compliance as soon as possible.

Section 25 of the PIPES Act required PHMSA to review and comment on the GAO report on the seven-year assessment interval and send Congress legislative recommendations necessary to implement the conclusions of that report. PHMSA has reviewed our experience with gas transmission operators' implementation of integrity management and the report of the General Accountability Office on this subject. We reported our findings to Congress on this topic last year and recommended that Congress amend the law to provide us the authority to promulgate risk based standards for pipeline reassessment. As a risk-based, data driven organization, we continue to believe that a scientific basis is the best way to inform safety decisions and the allocation of safety resources. We have demonstrated that as an agency, we and our state agency partners have the ability, experience and training to review the adequacy of engineering justification that would be presented to us by operators seeking to vary the reassessment interval. We recently held a public meeting on the technical basis for making decisions on assessment intervals. The bottom line is that we believe these decisions should be made on a case-by-case basis, one operator at a time, and segment by segment, so that relevant operating characteristics can be considered along with individual operator performance.

PHMSA very much appreciates the opportunity to report on the status of our progress with PIPES Act implementation and overall pipeline safety program. We share your commitment to improving safety, environmental protection and reliability of our nation's pipeline system.

Thank you. I would be pleased to answer any questions you may have.

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