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Panel revises ND gathering pipeline rules to address concerns raised by oil industry, lawmakers

North Dakota Petroleum Council President Ron Ness, right, speaks during a May 24 news conference at the Williston Basin Petroleum Conference at the Bismarck Event Center in Bismarck. To his left is Lynn Helms, director of the North Dakota Department of Mineral Resources. Forum News Service file photo

BISMARCK — North Dakota regulators approved revised rules for gathering pipelines Monday, Nov. 7, to address concerns raised by the oil industry and state lawmakers who decided in September to delay the groundbreaking rules from taking effect.

The state Industrial Commission voted unanimously Monday to approve the revisions, which make the rules narrower and less retroactive than originally proposed. Department of Mineral Resources Director Lynn Helms said the proposed rules are still robust, including a berm requirement that will affect an estimated 1,400 sites.

"We think that will substantially reduce the off-site spills and releases," he said.

The proposed rules apply to smaller gathering pipelines that transport oil and produced water — a waste byproduct of oil production — from the well to processing facilities.

The rules will take effect Jan. 1 if approved Dec. 5 by the Legislature's Administrative Rules Committee, which voted in September to delay them.

Industry representatives complained at the time that the rules would create confusion, additional costs and weren't what lawmakers intended in a comprehensive bill passed last year.

One revision approved Monday clarifies which sites will need a berm at least 6 inches tall to prevent spills from leaking off-site, while also adding the language "if deemed necessary by the director" to the section on berms for treating plants.

It also gives operators 180 days to install a berm from the date they're notified they need one, due to North Dakota's long winters, Helms said.

"There is more of a bright-line test," he said, calling the provision "much more enforceable and much clearer."

Among the other revisions, a bonding requirement for gathering pipelines will no longer be retroactively applied to pipelines in place before April 20, the effective date of the legislation.

Operators will still have to provide notice before installing gathering lines for oil and produced water, but a similar provision for gas gathering lines was removed from the proposed rules because lawmakers said that wasn't the legislative intent.

Helms said the revised set of regulations remains "very vigorous," noting the bonding, berm and third-party inspection requirements and the fact operators must file affidavits describing their leak protection methods — and, if they have any, their leak detection methods, though those aren't required.

"I think the rules as amended are still a big step in the right direction," said Gov. Jack Dalrymple, who chairs the three-member Industrial Commission that oversees oil and gas regulation.

North Dakota Petroleum Council President Ron Ness said other states will look at the precedent-setting rules, and it was important to take the additional time to get them right.

"This is essentially a better rule. (It) didn't change the stringent nature of them. It just made it more clear for the regulated community and clearly followed the legislative intent," he said.

Mike Nowatzki

Mike Nowatzki reports for Forum News Service. He can be reached at (701) 255-5607.