On October 26, 2018 the Federal Energy Regulatory Commission’s (FERC) Office of Energy Projects (OEP) released a draft “Guidance for Horizontal Directional Drilling Monitoring, Inadvertent Return Response, and Contingency Plans” (Draft HDD Guidance). Horizontal Directional Drilling is a method of installing underground pipelines, in which an underground path is drilled for the pipeline without disturbing the surface. This method is used to install portions of oil and gas pipelines that pass under rivers, streams and other water bodies—harm to which is frequently cited by environmental groups that bring National Environmental Policy Act (NEPA) challenges to pipelines in court.
Accidents are not uncommon during the construction of the underground portion of oil and gas pipelines. In August 2016, Algonquin Gas lost the drill stem while drilling a hole under the Hudson River, and failed to follow correct procedure in its recovery efforts, temporarily harming wetlands. The Rover Pipeline, an interstate gas pipeline that will carry shale gas from the Marcellus and Utica deposits in West Virginia, Pennsylvania and Ohio to markets in the Midwest, Canada and beyond, has seen two major accidents during construction: In April 2017, two million gallons of drilling fluid were spilled during horizontal directional drilling in Ohio, followed by 150,000 gallons at the same site in January 2018. Meanwhile, natural gas companies are experiencing an increasing demand in both domestic and international markets. Meeting this growing demand while maintaining environmental standards is currently a key objective in the field for regulators and members of the industry.
Under FERC’s Wetland and Waterbody Construction and Mitigation Procedures, HDD Plans must be filed as part of the pipeline permitting process before pipeline construction begins on all HDD crossings of wetlands and waterbodies. Under these regulations, HDD plans already must minimize the disturbance of wetlands and water bodies, identify mitigation measures to be used in the event of inadvertent release of drilling fluids, and provide contingency plans for crossing the waterbody in case the HDD is unsuccessful.
The new Draft HDD Guidance is intended to help the pipeline industry improve their HDD Plans and make OEP’s NEPA review more efficient and effective. It asks for additional information to assist with FERC environmental staff with its NEPA review , including: “crossing-specific geotechnical information and crossing profiles showing the feasibility of the crossing; a hydrofracture and [inadevertent release] risk evaluation; drilling fluid composition (including the use of drilling mud additives, and source water identification and analysis) and management; HDD monitoring procedures and document retention; and unique conditions identified along proposed HDD alignments that may increase the risk of HDD construction complications, inadvertent releases, or cause other environmental concerns.”
The Draft HDD Guidance also provides the pipeline industry with a detailed list of sections that HDD plans should contain, including plans for what personnel will be retained to oversee the project, drilling fluid management plans, and response and restoration plans in the event of inadvertent releases of drilling fluids.
The Draft HDD Guidance will be nonbinding, but compliance will likely help applicants proceed expeditiously through the permitting process. It was open for public comment until December 28, 2018, with a final version slated to be released in February 2019. Initial industry response includes concerns that regulators' requests are over-broad, asking for information that may be unavailable at the time of plan submission.