U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Instilling A Culture of Safety Alan Mayberry Deputy Associate Administrator August 19, 2014

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Past Events Shaping our Agenda - 2 -

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration What is a Safety Culture? - 3 -

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration - 4 -

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration - 5 -

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration A Good Safety Culture Doesn’t Happen by Accident. It is Instilled in the Organization by Management and Evolves Over Time. Evolution Requires Consistent and Constant Management Commitment

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Levels of Cultural Evolution Backward. Operational focus. Safety is an add-on requirement. Demonstrate compliance. Try not to get caught. Use risk assessment to demonstrate acceptable levels of risk, and audits to verify compliance. Why spend money on more “programs”? Reactive. General compliance with current processes and performance. Safety is important after accidents. Fix the obvious problems that external reviews/regulators require you to

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Levels of Cultural Evolution Analytical. We have systems, processes, and models in place. We make sure we follow our rules. Proactive. We actively search for problems, encourage early reporting of safety problems, perform investigative risk analyses and independent audits. Pervasive. Safety pervades the way we think and work every hour of the day

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Reactive Backward Analytical Proactive Pervasive Continuous Management Commitment Drives Evolution

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration A Safety Culture is one that goes beyond, or puts aside for the moment, the natural organizational or personal desires for self-esteem, self- promotion, and self-defense and actively delves into critical self-examination, honest self- evaluation, and humble self-improvement.

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration The appropriate balance between prescriptive and flexible regulations (or the need to regulate in some areas at all) is determined by how much faith the regulator has in the industry’s commitment to safety in the absence of prescriptive regulation (i.e. the safety culture of the regulated industry) Another reason you should care about your industry’s safety culture:

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration RP 1173 Pipeline Safety Management System Requirements PHMSA has participated in the development and sponsored public workshops on PSMS (and safety culture). Final version is expected to be promulgated in the near future. Embraces and reinforces the major tenets of safety culture

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration RP 1173 Safety Culture Elements Leadership Commitment and Stakeholder Engagement. Risk Management and Continuous Improvement. Planning, Training and Preparedness. Incident Investigation and Evaluations. Assessments and Audits

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration PHMSA’s Plans for SMS Rulemaking Totally Depend on Industry’s Response to RP 1173 We will monitor progress to see if industry embraces and seriously implements RP 1173 We hope serious management commitment within the industry will obviate the need for rulemaking

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Lessons Learned Important progress being made under Integrity Management, but it is time for the next steps – IMP 2.0 Clearly operators don’t know their systems as well as they need to for successful risk management – Verified records on materials, operational history – Inadequate consideration of surrounding environment and possible influences/interactions – simple risk models IMP has laid a good foundation that must be built upon – Safety Management Systems – API RP 1173 – Safety Culture’s important contribution / empowerment Construction challenges remain – QMS+ coming soon

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Top Priorities for FY 2014 Anticipate & Avert High Consequence Events by: i.Issue High Priority Rulemakings ii.Improve State Program Oversight iii.Implementing Congressional Act Mandates and Recommendations iv.Identify and Promote a Suite of Meaningful Performance Metrics v.Promotion of Pipeline R&D and Technological Advancement Build & Broadcast Understanding of Safety Risks by: i.Engage, Educate, and Empower the Public and ER Community (Damage Prevention, PIPA, 811, ER Training) ii.IMP-2.0 – Sharpening Understanding and Communication Catalog & Curtail Highest Risks by: i.Improve Consistency, Unification and Data Driven Inspections for Federal and State Actions ii.Develop and Deploy a Pipeline Safety Workforce Management Strategy (succession planning, training, resource allocation)

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Rulemakings in Process Safety of On-Shore Hazardous Liquid Pipelines (NPRM stage) Safety of Gas Transmission and Gathering Lines (NPRM stage) – Including Integrity Verification Process (IVP) Excavation Damage Prevention (Final Rule stage) EFV Expansion beyond Single Family Residences (NPRM stage) Operator Qualification, Cost Recovery and Other Pipeline Safety Proposed Changes (NPRM stage) Rupture Detection and Valve Rule (NPRM stage) Miscellaneous Rulemaking (Final Rule stage) Plastic Pipe (NPRM stage) Standards Update (Final Rule stage) LNG (ANPRM or NPRM)

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Selected Issues in Play Aging infrastructure: rate mechanisms Data: – “Meaningful” Metrics initiatives – Establish few key performance indicators with stakeholders (aka “DQAT”) Methane emissions Construction quality Valve/Rupture Detection LNG