1. U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Pipeline and Hazardous Materials Safety Administration Program Overview February 2012

2. U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Role of Pipelines 2.5 million miles of energy pipelines transport 2/3 of U.S. energy consumption Support our basic human needs, economic mobility, and security –Direct: gasoline, natural gas, propane –Indirect: electric generation, telecommunications, water supply Interdependencies between pipelines and other vital services are not well understood

3. U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Our Agency Mission To ensure the safe, reliable, and environmentally sound operation of the Nation’s pipeline transportation system.

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

5. U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration What We Do Our Base Programs Data Analysis and Trending Regulatory Development and Coordination Inspection, Enforcement and Emergency Response –Integrity Management –Emergency Response State Pipeline Safety Grant Programs Damage Prevention and Public Education Research and Development

6. U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Where We Are

7. U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Pipeline Safety Reauthorization Reauthorization of the Pipeline Safety Program –7 hearings in 2010 – 5 hearings in 2011 –Will set most of regulatory agenda for the next 4 years –In one of their final actions for 2011, the House and Senate passed a pipeline safety bill consistent with the legislative proposal we submitted to Congress last year. –President Obama signed the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011 on January 3, 2012. –New law compliments actions such as Secretary LaHood’s “Call to Action” plan to address pipeline infrastructure risks. - 7 -

8. U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration New Pipeline Safety Law General Themes / Provisions in Play To advance pipeline safety, the bill doubles the maximum fines that pipeline operators face for safety violations. More Inspection Eliminating exemptions from One-Call laws Study and regulate HL leak detection The Bill requires PHMSA to issue new pipeline safety standards requiring operators to install automatic or remote-controlled shut-off valves and excess flow valves in new or replaced transmission pipelines. - 8 -

9. U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration New Pipeline Safety Law –Extends EFV’s rules to multi-family/small commercial –Cost recovery for special permits and new construction –Study/report on risks of Canadian crude from oil sands –Increased data reporting – including geospatial data –Removal of exemptions for various pipelines –The law authorizes PHMSA to award $110 million in safety-related grants each year. –PHMSA is authorized to add a number of new pipeline inspectors to support its investigation and enforcement obligations. - 9 -

10. U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Questions – Thank You! - 10 -