ARCHIVED - National Energy Board Onshore Pipeline Regulations, 1999 (OPR-99) Final Audit Report for Integrity Management, Safety, Environmental Protection, Emergency Management, Crossings and Public Awareness Programs - Appendix I - Integrity Management Program Audit Evaluation Table

Appendix I
Westcoast Energy Inc., carrying on business as
Spectra Energy Transmission (Westcoast)
Integrity Management Program Audit Evaluation Table

Table of Contents

• Introduction
• 1.0 Policy and Commitment
  • 1.1 Policy and Commitment Statements
• 2.0 Planning
  • 2.1 Hazard Identification, Risk Assessment and Control
  • 2.2 Legal Requirements
  • 2.3 Goals, Objectives and Targets
• 3.0 Implementation
  • 3.1 Organizational Structure, Roles and Responsibilities
  • 3.2 Management of Change
  • 3.3 Training, Competence and Evaluation
  • 3.4 Communication
  • 3.5 Documentation and Document Control
  • 3.6 Operational Control-Normal Operations
  • 3.7 Operational Control-Upset or Abnormal Operating Conditions
• 4.0 Checking and Corrective Action
  • 4.1 Inspection, Measurement and Monitoring
  • 4.2 Corrective and Preventive Actions
  • 4.3 Records Management
  • 4.4 Internal Audit
• 5.0 Management Review
  • 5.1 Management Review

Introduction and Definitions

Throughout the Westcoast Integrity Management Program (IMP) Audit Evaluation Table, reference is made to the following main documents related to the integrity programs of the parent company Spectra Energy, also referred to as Spectra Energy Transmission (SET). These documents are:

1. The SET BC Pipeline and Field Services Pipeline Integrity Program (SET-BC PIP), which refers to the Alberta and British Columbia pipeline systems; and
2. The SET BC Pipeline and Field Services Pressure Equipment Integrity Management Program (SET-BC PEIM), which refers to the above ground pressure equipment and pressure piping facilities for the compressor and meter stations in Alberta and British Columbia.

In these documents, the following definitions were provided with respect to the pipelines and facilities for Westcoast:

• SET-West refers to Westcoast facilities located in Alberta and British Columbia; and
• SET-BC refers to Westcoast facilities located in British Columbia.

Also, throughout this IMP Audit Evaluation Table, any italicized text corresponds to excerpts taken directly from Westcoast documents.

1.0 POLICY AND COMMITMENT

1.1 Policy and Commitment Statements

Expectations:

The company shall have a clearly articulated policy and leadership commitment approved and endorsed by management (the Policy).

References:^{Footnote 1}

OPR-99 sections 4, 47 and 48
CSA Z662-11 Clauses 3.1.2(a) and 3.2

Assessment:

Set-BC PIP

With respect to sub-element 1.1 Policy and Commitment, the SET-BC PIP contains the management statement in Section 1 of the document as follows:

“The Pipeline Integrity Program (PIP) is a process for setting policy and expectations for all Pipeline and Field Services personnel involved in the operation and maintenance of our pipelines. Highly reliable pipelines and quality pipeline integrity practices are critical to the success of Pipeline and Field Services business. Everyone who is engaged in the operation, maintenance and reliability of our assets has a personal responsibility for getting pipeline integrity right. Line managers should follow this document in order to comply with Pipeline and Field Services pipeline integrity policies.”

This policy and commitment statement is signed by the Vice President, Operations, General Manager, Field Services, and General Manager, Pipeline, Midstream and NGL.

Set-BC PEIM

The SET-BC PEIM, Section 1 contains a management statement setting the policy and expectations for all personnel involved in the pressure equipment in above ground facilities.

This management statement, signed by the Vice President SET-West Operations,  states:

“Management shall follow this document in order to comply with Pipeline and Field Services (PLFS) Pressure Equipment Integrity Policy and the applicable regulatory requirements.”

Summary

Policy and commitment statements exist for the Westcoast pipeline system. However, as general observation, the two statements as written may appear to lack a strong management direction with current wording (i.e. the use of “should” versus “shall”). 

During interviews with Westcoast staff, they indicated that the Operations Management System (OMS) outlines the management commitment and the roles of Operations personnel. The OMS information is located on the Westcoast’s intranet site, the Source; however the policy and commitment document is not located on the Source.

Both management and employees contributed to the development of the OMS. The IMP policy and commitment fits into the hierarchy of the SET policy and commitments. The OMS is informally reviewed by management with employees but there is no formal communication plan for the various policy and commitment statements. The management system element of communication is reviewed and assessed under 3.4 Communication in this audit evaluation table.

Westcoast meets the requirements for policy and commitment in its IMP. Based on documents reviewed and interviews, Westcoast was able to demonstrate that it has policy approved and endorsed by senior management and the policy commits to continual improvement and is communicated throughout the organization and it has met the requirements of this audit sub-element.

Compliance Status: Compliant

2.0 PLANNING

2.1 Hazards Identification, Risk Assessment and Control^{Footnote 2}

Expectations:

The company shall be able to demonstrate a procedure to identify all possible hazards. The company shall assess the degree of risk associated with these hazards. The company should be able to support the rationale for including or excluding possible risks in regard to its environment, safety, integrity, crossings and awareness and emergency management and protection programs (management and protection programs). The company shall be able to implement control measures to minimize or eliminate the risk.

References:

OPR-99 sections 4 (2), 39, 40, 41
CSA Z662-11 Clauses 3.1.2(f), 3.2(a), 3.2(b), 10.5.1.1(d) and 16.2

Assessment:

Set-BC PIP

With respect to this sub-element, Section 3.0 Scope of the SET-BC PIP states that “This Program addresses the routine integrity activities for both operating and deactivated pipelines in the BC Pipeline and Field Services Division of SET-BC. The PIP considers all hazards that may cause significant damage or deterioration to the pipelines. This document is applicable to the entire SET-BC pipeline system with the exception of pressure vessels, associated pressure piping, compressors and associated equipment, and pipeline valves.”

Section 10.0 Pipeline Risk Assessment of the SET-BC PIP contains a general statement: “Risk assessment principles, in various forms, have been the foundation of integrity management. Risk assessments can vary in scope or complexity and use different methods or techniques. For SET-BC a key role of performing a formal risk assessment of the pipeline system is to validate the effectiveness of the Pipeline Integrity Program and identify any deficiencies or needed changes in the integrity program.

SET-BC risk assessment considers several variables and attributes with regards to eight threats and three consequences. These threats are; external corrosion, internal corrosion, manufacturing defects, ground movement, third party damage, incorrect operations, construction threat and stress corrosion cracking. The consequence types are; safety, economic loss, and environmental loss.

SET- BC has selected the Dynamic Risk – Risk Analyst Program as the primary risk assessment software. This is a comprehensive tool that performs pipeline risk assessment calculations and analysis. This ability allows SET- BC to identify the primary risk drivers and plan mitigation accordingly.”

Set-BC PEIM

The SET-BC PEIM does not speak directly to risk assessment, but does reference the Risked-Based Inspection approach used for pressure vessels and pressure piping. Section 14.2 Inspection Management Guidelines, states the following:

“The PLFS Inspection Management Guidelines drive the inspection and RBI process. Inspection management software is used to manage technical data and records for pressure equipment. Inspection requirements and frequencies are established and maintained through the risk based module within this program.”

Summary

The statements quoted in the SET-BC PIP indicate that Westcoast identifies many of the hazards to its pipeline by way of its current monitoring and inspection programs. Westcoast provided an example of a documented hazard identification supporting the rationale for including or excluding industry recognized hazards and a documented risk assessment assessing the degree of risk associated with these hazards.

Documentation reviewed as an example of the hazard identification and risk assessment for CS7 to CS8 on the 30” pipeline confirmed that a comprehensive integrity relative risk analysis was performed and had evaluated seven standard threats. The consequences of a pipeline failure as a result of these threats were also evaluated in the areas of impact on population, environment and business.

Based on documents reviewed and interviews, the Company was able to demonstrate that it has a documented procedure to identify all possible hazards. Westcoast was able to demonstrate that it has assessed the degree of risk associated with these hazards.

Compliance Status: Compliant

2.2 Legal Requirements

Expectations:

The company shall have a verifiable process for the identification and integration of legal requirements into its management and protection programs. The company should have a documented procedure to identify and resolve non-compliances as they relate to legal requirements which includes updating the management and protection programs as required.

References:

OPR-99 sections 4, 6, 40 and 41(1)
CSA Z662-11 Clause 3.1.2(h)(i) and 3.2

Assessment:

Set-BC PIP

The SET-BC PIP document, Section 2 states that Westcoast is committed to operating and maintaining its pipeline system in a responsible manner that complies with the requirements of CSA Standard Z662 and the National Energy Board Onshore Pipeline Regulations. Other than the statement in Section 2, there is no documented procedure for reviewing and updating revisions to legal requirements. However, Westcoast personnel have representations on regulatory committees (e.g., Canadian Standards Association (CSA Z662-11 and CSA B51-09) technical committees and the International Pressure Equipment Association (IPEA), so that they are informed on current and upcoming regulations and industry best practices.

Set-BC PEIM

In terms of pressure equipment and pressure piping, the SET-BC PEIM, Section 5 Regulatory Requirements, states that:

“PLFS designs, constructs, operates, maintains and decommissions all of its pressure equipment in accordance with the requirements of CSA B51, the National Energy Board PPR and the applicable provincial regulatory Safety Codes, Acts and regulations”.

Appendix B of the PEIM references standards and codes applicable to and referenced within the PEIM. There are additional industry codes and standards that have not been listed in Appendix B. While these codes and standards are not strictly regulated and are not required to be included, Westcoast relies on Risked Based Inspection (RBI) methodology and there is no reference to the API standards which are considered critical to the RBI process. These include:

• API RP 571 Damage Mechanisms Affecting Fixed Equipment in the Refining Industry
• API RP 572 Inspection Practices for Pressure Vessels
• API RP 573 Inspection of Fired Boilers and Heaters
• API RP 574 Inspection Practices for Piping System Components
• API Std 579-1/ASME FFS-1 Fitness-For-Service
• API RP 577 Welding Inspection and Metallurgy
• API RP 580 Risk-Based Inspection
• API RP 581 Risk-Based Inspection Technology
• API Std 653 Tank Inspection, Repair, Alteration, and Reconstruction

Also not included are the following National Association of Corrosion Engineers (NACE) publications:

• NACE MR0175/ISO 15156, Petroleum and natural gas industries–Materials for use in H2S-containing environments in oil and gas production.
• RP0296-2004, Guidelines for Detection, Repair, and Mitigation of Cracking of Existing Petroleum Refinery Pressure Vessels in Wet H2S Environments
• NACE RP0502-2002, Pipeline External Corrosion Direct Assessment Methodology
• NACE RP0775-2005, Preparation, Installation, Analysis, and Interpretation of Corrosion Coupons in Oilfield Operations
• NACE SP0169-2007 (formerly RP0169), Control of External Corrosion on Underground or Submerged Metallic Piping Systems
• NACE SP0572-2007 (formerly RP0572), Design, Installation, Operation, and Maintenance of Impressed Current Deep Anode Beds
• NACE TM0284-2003, Evaluation of Pipeline and Pressure Vessel Steels for Resistance to Hydrogen-Induced Cracking

Also not included are the following publications from the Canadian Gas Association (CGA) and the Canadian Association of Petroleum Producers (CAPP):

• CGA OCC-1 2005 Control of External Corrosion on Buried or Submerged Metallic Piping System
• CGA OCC-2 1989 Control of Internal Corrosion of Pipeline Systems that Transport Sour Gas
• CAPP 2009-0010 Internal Corrosion Oilfield Water
• CAPP 2009-0011 External Corrosion Buried Pipelines
• CAPP 2009-0012 Internal Corrosion Oil Effluent
• CAPP 2009-0013 Internal Corrosion Sour Gas
• CAPP 2009-0014 Internal Corrosion Sweet Gas
• CAPP 2009-0019 Impressed CP design for safety
• CAPP 2009-1035 CP Electrical Installations

Summary

As with the API standards, the NACE, CGA and CAPP industry standards and best practices are not strictly legal requirements. However SET should include reference to them in its PEIM, in its PIP, and possibly in its Standard Operating Practices (SOP), where appropriate, because they contain valuable information that is technically relevant to its inspection, monitoring and mitigation programs. During interviews with some of the operations personnel, it was evident that they were not aware of many of these publications and that they could have benefited from the knowledge of these in the implementation of the Westcoast IMP programs referenced in the publications.

The SET-BC PIP has not included a formal documented and verifiable process for the identification and integration of its legal requirements other than references imbedded in its Introduction. SET-BC does not have a documented procedure for reviewing and updating revisions to the legal requirements.

Based on documents reviewed and interviews with staff, the Company was not able to demonstrate that it had identified its legal requirements or had integrated its regulatory obligations into its IMP.

Compliance Status: Non-Compliant

2.3 Goals, Objectives and Targets

Expectations:

The company shall have objectives and quantifiable targets relevant to the risks and hazards associated with the company’s facilities and activities (i.e. construction, operations and maintenance). The objectives and targets shall be measurable and consistent with the Policy and legal requirements and ideally include continual improvement and prevention initiatives, where appropriate.

References:

OPR-99 sections 40, 47 and 48
CSA Z662-11 Clauses 3.1.2(h)(ii) and 3.2

Assessment:

Set-BC PIP

With respect to goals, objectives and continuous improvement, Westcoast has established five key performance indicators (KPI) relevant to its IMP. Section 11: Program Performance Indicators of the PIP states: “In order to regularly assess the success of program implementation SET-BC has developed a slate of Program Performance Indicators which will be assessed annually:

• Number of Third Party Pipeline Contacts
• Number of Pipeline Repairs as per CSA Z662
• Number of pipeline leaks and failures.
• Percentage of acceptable corrosion coupon readings
• Number of geotechnical incidents that require repair or stress mitigation.”

Set-BC PEIM

The SET-BC-PEIM does not contain a section on Goals, Objectives and Targets or on Key Performance Indicators.

Summary

The Westcoast systems integrity group indicated during interviews that the integrity performance indicators outlined in the PIP were recently collected and presented to SET management. The performance indicators were also reviewed with the Pipeline Operations and Maintenance Manual (POMM) team. The POMM team was asked to consider what performance indicators would be useful from a regional perspective and to forward any suggestions or ideas to the System Integrity group.

During the annual Information Exchange meeting with SET, the Systems Integrity group presented the KPI trends, which they provided as evidence of satisfactory implementation of the Integrity Program in achieving the program objectives. Westcoast also provided KPI scoring and tracking (SET OSC Monthly Scorecard - 2011 and 2012.pdf and SET-West OSC STIP Scorecard - December 2011.pdf), but these were related to OH&S key performance indicators and will be assessed by the Safety Discipline in this audit.

In response to the Draft Audit Report, Westcoast provided the OSC STIP Scorecard for December 2012 which included one performance metric related to its IMP, Cathodic Protection (CP) Effectiveness (Transmission). This performance metric indicated that 78 of 78 CP surveys were completed but that five areas were identified (November 2012) as not meeting the accepted CP criteria. It further indicated that, of the five remediation projects developed, none of them had been completed at the time of the December Scorecard issuance. This lack of immediate response is to be expected given the timeframe.

Although the SET-West STIP Scorecard contains one performance metric for its IMP, it does not contain any KPIs for its Pressure Equipment Integrity Program.

During the audit, Westcoast presented the KPI’s for corrosion coupons which indicated that 100% of the coupons met the target of less than 1 MPY, but examination of historical corrosion coupon results indicated that not all coupons met this key performance indicator target. Therefore, Westcoast has not accurately tracked or reported one of its KPIs for its IMP.

In response to the Draft Audit Report, Westcoast explained that the discrepancy in the historical corrosion coupon results versus the reported KPIs was due to Westcoast having provided the Board’s auditors with unfiltered data (i.e., corrosion coupon data from both the flowing pipeline, and from launching and receiving barrels). Westcoast clarified in its comments that the KPI target is based entirely on flowing pipeline coupon data and that, until recently, pipeline corrosion coupon data was the only data available. Westcoast indicated that, within the last couple of years, it has begun to install coupons in the launching and receiving barrels, and has determined that the same KPI target is not achievable in the relatively stagnant barrel environment. To ensure it is able to measure corrosion rates on its sending and receiving barrels, Westcoast indicated that, over the next few years, it will be installing coupon holders on most of the barrels in the gathering systems. Westcoast further indicated that, based on its limited data set, it appears that a barrel coupon KPI of more than 2 MPY may be reasonable; however, until it has more experience with this application, it is not able to state a specific barrel corrosion coupon KPI. Westcoast committed to clarifying that the KPI referenced in its IMP refers only to corrosion coupons in the flowing pipeline.

Westcoast’s comments on the Draft Audit Report provided some clarification on the coupon information; however, as Westcoast is still in the process of determining an appropriate target for its KPI with respect to barrel coupons, the adequacy and effectiveness of this target with respect to Westcoast’s IMP could not be assessed.

In March 2012, the Board posted its Pipeline Performance Measures Reporting Requirements stating that operating companies are required to annually report on the new performance measures commencing in 2013. The requirement to report on the new performance measures is in addition to current reporting required under the Onshore Pipeline Regulations, 1999 and the Pipeline Crossing Regulations, Part I and Part II. Part IV of the posted document specifies the reporting requirements for Integrity Management. In the posted information, it was stated that the Board expects companies, in their management systems, to set out objectives and targets that are company-specific and based on company variables. In addition, companies are expected to strive for continual improvement and to adjust targets as required.

Since the SET-BC PEIM does not have a documented Goals, Objectives and Targets for the Integrity Management Program for its pressure equipment and the SET-BC PIP has not accurately tracked or reported its Key Performance Indicators, Westcoast has not met the requirements for the audit sub-element of Goals, Objectives and Targets.

Based on documents reviewed and interviews with operations staff, the Company was not able to demonstrate that it was in compliance with audit sub-element 2.3 Goals, Objectives and Targets.

Compliance Status: Non-Compliant

3.0 IMPLEMENTATION

3.1 Organizational Structure, Roles and Responsibilities

Expectations:

The company shall have an organizational structure that allows its management and protection programs to effectively function. The company shall have clear roles and responsibilities, which may include responsibilities for the implementation of the management and protection programs.

References:

OPR-99 sections 40, 47 and 48
CSA Z662-11 Clauses 3.1.1, 3.1.2(b) and 3.2

Assessment:

Set-BC PIP

Section 6 of the SET-BC PIP dated October 2011 details the Responsibilities, Leadership & Accountability for the Pipeline Integrity Program, which includes:

• 6.1 General Leadership & Accountability statement;
• 6.2 Personnel Responsibilities;
  • 6.2.1 President, Spectra Energy Transmission – West
  • 6.2.2 Vice President of Operations, Spectra Energy Transmission – West
  • 6.2.3 General Manager of Operations
  • 6.2.4 Area Directors
  • 6.2.5 Director of Operations Engineering
  • 6.2.6 Regional Managers and other Managers in Operations
  • 6.2.7 Team Leaders of Pipeline Operations
  • 6.2.8 Director of (System) Integrity

Set-BC PEIM

Section 6 of the SET-BC PEIM dated June 30, 2008 “clarifies the Accountabilities within the PLFS for the Pressure Equipment Integrity Management Program”, which includes:

• 6.1 President, SET-West
• 6.2 Vice President, SET-West Operations
• 6.3 General Manager, SET-West Operations
• 6.4 Director Operations
• 6.5 Director, SET-West Operations Engineering
• 6.6 Manager, SET-West Assets
• 6.7 Manager, SET-West Plant Integrity
• 6.8 Manager, Operations
• 6.9 Team Leader, PLFS Operations and Maintenance
• 6.10 PLFS Operations and Maintenance Staff
• 6.11 Chief Power Engineer
• 6.12 Chief Inspector
• 6.13 Integrity Specialist

Appendix D of this document contains a schematic organization chart which illustrates these generic positions in the SET hierarchy. 16 organization charts received from the Source supported the organizational structure and the roles and responsibilities for the development, implementation and management of the integrity program. It is noted that the organizational chart in Appendix D is dated 30 June 2008 and there have been some organizational changes within Westcoast with respect to the IMP and PEIM.

Summary

In addition, Westcoast provided the information on Organizational Structure, Roles and Responsibilities for the Integrity Team members, including the Director of Integrity, Integrity Specialist, Integrity Engineer, Senior Integrity Technologist, Integrity Technologist, Senior Geotechnical Technologist, Geotechnical Technologist, Geotechnical Engineer and Integrity Specialist. The Westcoast organizational structure, including that of the Integrity Team, with its roles, responsibilities and accountabilities, meets the requirements of this audit sub-element.

Based on documents reviewed and interviews with operations staff, Westcoast was able to demonstrate that it was in compliance with the requirements of this audit sub-element.

Compliance Status: Compliant

3.2 Management of Change

Expectations:

The company shall have a management of change program. The program should include:

• identification of changes that could affect the management and protection programs;
• documentation of the changes; and
• analysis of implications and effects of the changes, including introduction of new risks or hazards or legal requirements.

References:

OPR-99 section 6
CSA Z662-11 Clause 3.1.2 (g)

Assessment:

Set-BC PIP

During the Processing Plant Audit, Spectra provided the Management of Change (MOC) document dated 2010-11-02, which outlined a consistent approach for operations to ensure that changes to assets were appropriate and that the processes were documented to comply with all regulatory requirements. The MOC process outlined the triggers for invoking this process, the accountabilities and responsibilities of various departments and personnel to ensure that changes were evaluated for all aspects to ensure that no new or additional hazards were being created with a specific change for any discipline.

Set-BC PEIM

Section 13 of the SET-BC PEIM, Management of Change, states “SET has a Management of Change (MOC) process in place to ensure that any modifications made to pressure equipment are done safely and in accordance with good operating practices. All PRD replacements are subject to the MOC process. The MOC process is located on the SET network.”

Summary

The Spectra Energy BC Pipeline and Field Services Standard Operating Practice (SOP), reference number 23.1, effectively deals with Management of Change. This SOP contains a brief description of the scope and purpose of MOC and provides a link to the MOC program on “The Source”. The SOP refers to BC Pipeline and Field Services and Westcoast indicated that the MOC program applies to all Spectra operations.

Based on documents reviewed and interviews with operations staff, Westcoast was able to demonstrate that it was in compliance with the requirements of this audit sub-element.

Compliance Status: Compliant

3.3 Training, Competence and Evaluation

Expectations:

The company shall have a documented training program for employees and contractors related to the company’s management and protection programs. The company shall inform visitors to company maintenance sites of the practices and procedures to be followed. Training requirements should include information about program-specific policies. Training should include emergency preparedness and environmental response requirements as well as the potential consequences of not following the requirements. The company shall determine the required levels of competency for employees and contractors. Training shall evaluate competency to ensure desired knowledge requirements have been met. Training programs should include record management procedures. The training program should include methods to ensure staff remains current in their required training. The program should include requirements and standards for addressing any identified non-compliances to the training requirement.

References:

OPR-99 sections 4, 18, 29 and 46
CSA Z662-11 Clauses 3.1.2(c), 3.2 and 10.2.1

Assessment:

Set-BC PIP

The SET-BC PIP, Section 7.0 Training and Qualifications states the following: “The goal of this section is to ensure that all employees are competent to perform their assigned tasks. It is the responsibility of each Team Leader within Pipeline Operations to ensure that qualified personnel are assigned to perform activities that affect pipeline integrity. Employees training needs have been assessed and documented specific to their job role. Employee training plans are developed based on job tasks and compliance to each task shown. This includes safety and technical training. Safety training requirements and vendor training are found at: https://thesource.spectraenergy.com/businesses/westca/oms/Pages/JobSpecificTrainingRequirements.aspx

Training is developed and delivered following a standard approach for operational manuals, procedures and employee evaluation requirements and their continued updates. Training manuals are used throughout the organization along with self-evaluation and mentor based assessments where the mentor assess employee in area of the manual content. All training is tracked through the use of the company Learning Management System (LMS).

Pipeline Integrity Program: Each Team Leader, Pipeline Operations, and the Director of Integrity shall identify all staff involved with activities that affect the integrity of the pipeline. All such staff will receive training on the content and intent of the Pipeline Integrity Program.”

Set-BC PEIM

The SET-BC PEIM, Section 11.0 Competency ad Training states the following: “This section defines the required competency and training of personnel who perform work under and impact the effectiveness of this program. This includes employees and contract personnel. This section outlines the scope and responsibilities of personnel who perform work under this program.”

Summary

In response to an Audit Information Request (AIR), Westcoast personnel stated “Being rolled-out in 2012 is the Pipeline Operator Qualification Training Program which will address all training and competency requirements noted in section 7 of the PIP. The LMS will be used to managed and report out on employee status in this training program. Contractors granted Spectra Energy employee status and required to take this training will also be tracked in the LMS.”

During an inspection of the Rosedale Compressor Station (CS9 – T South) for an underground piping inspection program, Westcoast indicated that all of the NDE (Acuren) and recoating (OMH) personnel had the proper training and competency to conduct the inspection and recoating of the underground piping. The project leader provided the training and certification records for the contract personnel.

Based on documents reviewed and interviews with operations staff, the Company was able to demonstrate that it was in compliance with the requirements of the audit sub-element 3.3 Training, Competence and Evaluation.

Compliance Status: Compliant

3.4 Communication

Expectations:

The company shall have an adequate, effective and documented communication process(es):

• to inform all persons associated with the company’s facilities and activities (interested persons) of its management and protection programs policies, goals, objectives and commitments;
• to inform and consult with interested persons about issues associated with its operations;
• to address communication from external stakeholders;
• for communicating the legal and other related requirements pertaining to the management and protection programs to interested persons;
• to communicate the program’s roles and responsibilities to interested persons.

References:

OPR-99 Sections 4, 18, 28, 29, 40, 47 and 48
CSA Z662-11 Clauses 3.1.2(d) and 3.2

Assessment:

Set-BC PIP

The SET-BC PIP does not have a specific section detailing the communication requirements of the organization, but Section 6 of the SET-BC PEIM document details the Responsibilities, Leadership & Accountability for the Pipeline Integrity Program with responsibilities relevant to communication.

Set-BC PEIM

The SET-BC PEIM does not have a specific section detailing the communication requirements of the organization, but Section 6 of the document details the Responsibilities, Leadership & Accountability for the Pipeline Integrity Program with responsibilities relevant to communication.

Summary

Westcoast does not have a formal Communication Plan, however as part of its response to the Board’s AIR #7, Westcoast stated that the following communication processes take place:

1. An annual SOP and Integrity Program review involving all directors, managers, team lead system integrity and other subject matter experts;
2. A monthly Pipeline Integrity Conference call chaired by System Integrity with invitations to directors, managers, team leads and field technicians;
3. The annual pipeline integrity workshop (typically 40 to 50 attendees);
4. Frequent integrity presentations to the Operations Steering Committee; and
5. Other special topic meetings initiated as required by System Integrity.

While there are ad hoc communication processes in place, they are not fully effective in achieving the desired end result of a formal Communication Plan.

Based on documents reviewed and interviews with operations staff, the Company was not able to demonstrate that it was in compliance with the requirements of the audit sub-element 3.4 Communication.

Compliance Status: Non-Compliant

3.5 Documentation and Document Control

Expectations:

The company shall have a documentation and document control process that supports its management and protection programs. The documentation shall be reviewed and revised at regular and planned intervals. Documents shall be revised immediately where changes are required as a result of legal requirements or where failure to make immediate changes may result in negative consequences. The company should have procedures within its management and protection programs to control documentation and data as it relates to the risks identified in element 2.0.

References:

OPR-99 sections 4, 27, 47, 48
CSA Z662-11 Clauses 3.1.2(e)(f), 3.2 and 10.5.1.1(a) to (d)

Assessment:

Set-BC PIP

Section 8 of the SET-BC PIP, Documents states “General; Documents and documentation are an important part of the Pipeline Integrity Program. In addition to this program document, more detailed Integrity Plans may be developed, as appropriate, to manage specific integrity threats or specific types of damage. The details of integrity activities and general operations activities are contained in the Standard Operating Practices (SOPs). Other integrity records are located in GIS, SAP, or regional operations offices.

Integrity Programs, Plans and Practices
Both this Integrity Program and the SOPs are maintained by the System Integrity Team located at the Vancouver office. The PIP and SOP’s are located on the SET-BC intranet”

Set-BC PEIM

Section 7.0 of the SET-BC PEIM, Documentation and Data Control states: “This section clarifies the approach for controlling the documentation and data related to pressure equipment integrity management.”

Summary

Document review is an integral part of the audit process and at the Board’s request, Westcoast provided scores of documents that illustrated Spectra’s adherence to the requirements for documentation and document control.

Based on documents reviewed and interviews with operations staff, the Company was able to demonstrate that it was in compliance with the requirements of the audit element Documentation and Document Control.

Compliance Status: Compliant

3.6 Operational Control-Normal Operations

Expectations:

The company shall establish and maintain a process to develop, implement and communicate mitigative, preventive and protective measures to address the risks and hazards identified in elements 2.0 and 3.0. The process shall include measures to reduce or eliminate risks and hazards at their source.

References:

OPR-99 sections 4, 27, 36, 37, 39 and 40
CSA Z662-11 Clause 3.1.2(f), 3.2 and 10

Assessment:

Set-BC PIP

With respect to the requirements of Operations Control-Normal Operations, Section 9.11 of the SET-BC PIP, Overpressure Protection and 9.11.1 Gas Control stated the following: “Guidelines for Receipt Point Overpressure Protection: BC Pipeline and Field Services pipelines and all systems delivering gas into Spectra must meet the requirements of CSA Z662-11. There are guidelines for Receipt Points that aid in protecting the pipelines from over pressure according to CSA Z662-11 Section 4.18. These include system requirements for Pressure Control systems and for Over pressure Protection systems.

Set-BC PEIM

With respect to the requirements of Operations Control-Normal Operations, Section 16 of the SET-BC PEIM, Overpressure Protection and Protective Devices stated “This section reviews the approach for ensuring that all pressure relief devices (PRDs) are serviced at the required intervals, proper procedures are followed in removing the devices and each device is returned to the original or other appropriate location.”

Summary

Westcoast provided documents and records indicating that PRDs serving the pipeline and facilities were regularly serviced and inspected on an interval of 3 years. The service records are being stored in VisionsTM software, which is used to manage the servicing, inspection and surplus inventory records.

In addition, with respect to gas quality and measurement, during interviews and document review, the audit found the following:

The Westcoast Measurement Group:

• Is responsible for any sites that tie-in to mainline or gathering systems
• Provides oversight of 3rd party overpressure control and over pressure protection.
• Enforces the General Terms and Conditions Agreement (GTCA)
• Enforces the Measurement Policy
• Has specific key performance indicators (KPIs) to evaluate its effectiveness
• Has been internally audited twice

The General Terms and Conditions Agreement (GTCA) sets out:

• Requirements for pressure control and pressure relieving that comprise an overpressure protection system

The Measurement Policy sets out:

• What data is to be collected and sent to Westcoast on an annual basis
• What pressure control and pressure relief devices are considered acceptable
  (Note: Westcoast does not allow line losses as a means to control the pressure)

Observations regarding gas control:

• Moisture content is monitored manually, however the more susceptible/riskier lines have online moisture analyzers
• Receipt points on mainline have automatic analyzers and automatic shut in devices

Other general observations:

• Westcoast  regularly conducts inspections of its producers
• Producers send Westcoast any request to ship additional products into the system (i.e., frac fluid).

Based on documents reviewed and interviews with operations staff, the Company was able to demonstrate that it was in compliance with the requirements of the audit element Operations Control-Normal Operations.

Compliance Status: Compliant

3.7 Operational Control-Upset or Abnormal Operating Conditions

Expectations:

The company shall establish and maintain plans and procedures to identify the potential for upset or abnormal operating conditions, accidental releases, incidents and emergency situations. The company shall also define proposed responses to these events and prevent and mitigate the likely consequence and/or impacts of these events. The procedures must be periodically tested and reviewed and revised where appropriate (for example, after emergency events).

References:

OPR-99 sections 4, 32, 37, 40 and 52
CSA Z662-11 Clauses 3.1, 3.2, 4.18, 10.9.5

Assessment:

The evaluation of this audit element for the Safety and Emergency Management Programs (Appendix II and Appendix IV) has verified that Westcoast has developed and implemented an emergency preparedness and response plan. The Spectra Energy Standard Operating Practice 13.1 Emergency and Incident Response Procedures refers to the Emergency Management Manual located on the Portal and outlines the initial actions that must be taken, the roles and responsibilities of the Emergency Response Team and the documentation that should be completed in response to an incident. There are no additional requirements for this management system element for the Integrity Management Program.

Compliance Status: Not-Applicable

4.0 CHECKING AND CORRECTIVE ACTION

4.1 Inspection, Measurement and Monitoring

Expectations:

The company shall develop and implement surveillance and monitoring programs. These programs should address contract work being performed on behalf of the company. These programs should include qualitative and quantitative measures for evaluating the management and protection programs and should, at a minimum, address legal requirements as well as the risks identified as significant in elements 2.0 and 3.0. The company should integrate the surveillance and monitoring results with other data in risk assessments and performance measures, including proactive trend analyses. The company shall have documentation and records of its surveillance and monitoring programs.

References:

OPR-99 sections 4, 27, 28, 36, 37, 39, 47, 48, 53 (1) and 54 (1)
CSA Z662-11 Clauses 3.1.2(h)(i), 3.2, 9 and 10

Assessment:

Set-BC PIP

The SET-BC PIP, Section 9 Integrity Elements contains the requirements of the inspection, measurement and monitoring programs.
These are: Corrosion Protection & Mitigation, Corrosion Coupons and Chemical Inhibitors, Pipeline Re-coating, Major Re-coat Projects, Pipeline Inspection by 1 In-Line Inspection, Defect Assessments, Non-Inline Inspectable Facility Piping, SCC Management, Right of Way Monitoring/Patrols, Aerial Surveys and Geotechnical Survey, Excavations, Bridge Crossings and Aerial Pipeline Crossings

Set-BC PEIM

The SET-BC PEIM, Section 14.2 Inspection Management Guidelines details the requirements for pressure vessels and pressure piping.
This includes: Inspection Management Software, Risk Based Inspection, Corrosion Monitoring and Mitigation Methods, Inspection Plans, NDE and Control of Monitoring and Measurement Devices.

Summary

Based on documents reviewed and interviews with operations staff, the Company was able to demonstrate that it was in compliance with the requirements of the audit element Inspection, Measurement and Monitoring.

Compliance Status: Compliant

4.2 Corrective and Preventive Actions

Expectations:

The company shall have a process to investigate incidents or any non-compliance that may occur. The company shall have a process to mitigate any potential or actual issues arising from such incidents or non-compliances. Such mitigation may include appropriate timing and actions for addressing the issues that arise. The company shall demonstrate that it has established a documented procedure to:

• set criteria for non-compliance;
• identify the occurrence of any non-compliances;
• investigate the cause(s) of any non-compliances;
• develop corrective and/or preventative actions; and
• effectively implement the required corrective and/or preventative actions.

The company shall develop procedures to analyze incident data in order to identify deficiencies and opportunities for improvement in its management and protection programs and procedures.

References:

OPR-99 sections 4, 6 and 52
CSA Z662-11 Clauses 3.1.2(g) and 3.1.2(h)(i), 3.2, 10.3.6, 10.4.4 and 10.5

Assessment:

Set-BC PIP

The SET-BC PIP does not contain a specific section on Corrective and Preventive Actions, but does have Section 9.10 Incident Investigations which states “To avoid repeated incidents it is necessary to thoroughly understand what caused the event. In those instances where the cause is not obvious and when materials or components are available, a detailed analysis shall be conducted under the direction of the System Integrity. The results of these analyses shall be shared with all pipeline personnel involved with integrity activities.” During the audit interviews and documentation review, Westcoast provided information on Spectra Energy’s incident investigation and reporting processes and procedures as outlined in the Summary.

Set-BC PEIM

Section 17.0 of the SET-BC PEIM, Corrective and Preventative Actions, Accidents and Incidents, states: “An Incident Notification System is located on the SET portal for documenting and tracking all incidents related to pressure equipment. Appropriate communication for reportable incidents is specified in the SET Emergency Response Plans (ERPs).

This section outlines the requirements for Non-Conformance Reports / Corrective Action Plan (Appendix H) developed for all items identified as non-conforming during audits, inspections, site visits, etc. NCRs are reviewed regularly by Spectra Management and the Chief Inspector. The Area Operations Directors are responsible for ensuring the completion of the CAPS.

Summary

• Westcoast has a well-developed and documented incident management process which includes:
  • Reporting criteria
  • Workflow processes
  • Responsibilities and Accountabilities
  • Mandatory training requirements
  • Management review process
  • Process safety management key performance indicators
  • Reporting and analysis, using API RP 754 for PSM guidelines.
• The audit found that the incident management data analysis, trending and reporting process is relatively new (developed in 2009) and is not yet mature (primary focus is on API RP 754 safety indicators versus management system indicators).
• The Incident/Emergency Reporting Procedure document that covers One Window Reporting for Federal and Provincial Incidents was demonstrated and reviewed on the Source.
• Spectra Energy personnel demonstrated and reviewed the Regulatory Incident Reporting Guidelines For On-Call Incident Reporting Supervisor document on the Source.
• The Incident Reporting Process document also stated the reporting criteria for federal and provincial reporting criteria for all types and causes of incidents.
• The audit reviewed the federal and provincial reporting criteria to ensure that they include the provincial and federal requirements for incident reporting.

Westcoast demonstrated it has documented procedures to:

• set criteria for non-compliance;
• identify the occurrence of any non-compliances;
• investigate the cause(s) of any non-compliances;
• develop corrective and/or preventative actions; and
• effectively implement the required corrective and/or preventative actions.

However, the company did not demonstrate it has developed or implemented procedures to analyze incident data in order to identify deficiencies and opportunities for improvement in its management and protection programs and procedures.

The audit analyzed Westcoast’s incident data from 2005 to present and determined that there were identifiable trends in the systems (gathering and transmission pipelines), facilities and equipment and management system disciplines. Spectra Energy should have analyzed these data to identify trends, systemic issues and opportunities for improvement in its Integrity Management Program.

Based on documents reviewed and interviews with operations staff, the Company was not able to demonstrate that it was in compliance with the requirements of the audit element Corrective and Preventive Actions.

Compliance Status: Non-Compliant

4.3 Records Management

Expectations:

The company shall establish and implement procedures to ensure that the records supporting the management and protection programs are retained, accessible and maintained. The company shall, as a minimum, retain all records for the minimum lengths of time as required by the applicable legislation, regulation and standards incorporated by reference into the regulation.

References:

OPR-99 sections 4, 41 and 56
CSA Z662-11 Clauses 3.1.2(e), 3.2, 9.11, 10.4 and 10.5.1.1(c)

Assessment:

Set-BC PIP

Section 8.3 of the SET-BC PIP, Integrity Records Management Systems states “SET-BC has developed a spatial data management system (SDMS) to support data associated with the pipeline assets. The basis of this system is a Geographic Information System (GIS) software program, which is used for capturing, storing, checking, integrating, manipulating, analyzing and displaying data related to the pipeline system and positions on the Earth's surface. In addition to geographical information and photography, this system is populated with asset information, operations and maintenance data, integrity data, right-of-way information, land owner information, and emergency response plans and data. While the majority of new integrity records are provided in electronic format, some are still received in hard copy only. An effort is being made to find a location where as many of these as possible can be included or electronically attached to the GIS system. Records of the maintenance activity are stored in SAP, a company-wide accounting, planning and records storage software. Information generated from the maintenance activity that is relevant to pipeline integrity is stored in (GIS) for analysis.”

Set-BC PEIM

While there was no specific section in the SET-BC PEIM dealing with records management, the audit confirmed through interviews, document and record requests that Westcoast has developed and implemented a records management process. The records management process ensures that the appropriate and required records are maintained and were readily available upon request.

Summary

Based on documents reviewed and interviews with operations staff, the Company was able to demonstrate that it was in compliance with the requirements of the audit element Records Management.

Compliance Status: Compliant

4.4 Internal Audit

Expectations:

The company shall develop and implement a documented process to undertake audits of its management and protection programs and procedures. The audit process should identify and manage the training and competency requirements for staff carrying out the audits. These audits shall be conducted on a regular basis.

References:

OPR-99 sections 4, 53 and 55
CSA Z662-11 Clauses 3.1.2(c) and 3.1.2(h)(iii)

Assessment:

Set-BC PIP

Section 12 Audits of the SET-BC PIP states “SET auditors regularly conduct audits of operations and the programs used by operations. The detailed charter of the Spectra Energy Audit Services Department can be found on the Spectra Intranet at https://thesource.spectraenergy.com/company/policies/Audit/audit_services.pdf.

Additional targeted audits may be requested by senior management as required. When the audit findings are associated with pipeline integrity System Integrity will assist with development of corrective action plans.”

Set-BC PEIM

Section 6.0 Accountability of the SET-BC PEIM, and Subsection 6.5 Director, SET-West Operations Engineering states “The Director of Operations Engineering is accountable to the VP of Operations to ensure the Pressure Equipment Integrity Management Program meets the requirements of the applicable regulatory authorities and all other applicable codes, standards and industry best practices, including applicable API and National Board codes and SET Engineering Specifications. The Director shall ensure that qualified personnel with technical knowledge and experience, review, maintain and audit the PEIM Program and are available to assist Operations and Maintenance personnel, led by the Directors of SET-West, to carry out the PEIM Program.”

Section 10.3 Approved Vendors / Service Companies states “Service Companies will be audited on a regular basis to ensure their qualifications and QC documentation are current and meet the intent of their registered QC manual.”

Summary

Following review of the SET-BC PIP and SET-BC PEIM, the Board made an AIR for the latest internal or third party audits that would pertain to the Integrity Management Program and the management system requirements.

Westcoast’s response to the AIR was as follows:

“It has been more than 5 years since the last internal Pipeline Integrity Program review. This was done by the Duke internal audit team. At that time only a few minor modifications to the cathodic protection requirements were recommended.

An integrity effectiveness review was recently carried out on all Spectra pipeline integrity programs by a consulting team engaged by the Houston corporate auditing group. This report is still being finalized. We were recently advised that Spectra West will experience an internal audit of pipeline integrity during 2012.”

During audit interviews, the audit found that:

• There has not been an internal audit of Westcoast’s systems since 2005.
• Westcoast has completed Assurance Reviews which do not examine evidence or documentation.
• Documents presented by Westcoast at the meeting did not demonstrate:
  • The methodology to determine appropriate frequency
  • Whether subject matter experts (SMEs) are involved in internal audits
  • That the audit results are incorporated into IMP.

In its comments on the Board’s Draft Audit Report, Westcoast advised that it has commenced an internal audit of Pipeline Integrity. This internal audit is still in progress and did not form part of the Board’s assessment of this sub-element.

Based on documents reviewed and interviews with operations staff, the Company was not able to demonstrate that it was in compliance with the requirements of the audit element Internal Audit.

Compliance Status: Non-Compliant

5.0 MANAGEMENT REVIEW

5.1 Management Review

Expectations:

The company shall formally review the management and protection programs for continuing suitability, adequacy and effectiveness. The review should be based on appropriate documentation and records including the results of the surveillance, monitoring and audit programs. This review should be formal and documented and should occur on a regular basis. The management review should include a review of any decisions, actions and commitments which relate to the improvement of the programs and the company’s overall performance.

References:

OPR-99 sections 4, 40 and 55
CSA Z662-11 Clauses 3.1.2 (h)(iii) and 3.2

Assessment:

Set-BC PIP

Section 2 Introduction of the SET-BC PIP states “Periodic evaluation will be carried out to ensure the program takes appropriate advantage of improved technologies and that the program utilizes the best set of prevention, detection and mitigation activities that are available for the conditions at that time. The performance indicators provide feedback to the programs, thereby allowing for continuous improvement of these programs. Periodically, audits are performed of the records to ensure all components of the PIP are satisfied and to assess the performance of the program. It is expected that this program will be continually evolving.”

Section 6 Responsibilities, Leadership & Accountability and sub-section 6.1 Leadership & Accountability states “Leaders in SET-BC which includes pipeline integrity are responsible for specific pipeline integrity management performance targets, as well as:

1. Integrity of the pipeline in the Leader’s operating area
2. Defining clear pipeline integrity roles and responsibilities
3. Engaging the workforce in pipeline integrity
4. Regular communication about relevant pipeline integrity issues
5. Ensuring the appropriate resources are in place
6. Ensuring the Pipeline Integrity Management Program is fully implemented
7. Measuring, reviewing and improving pipeline integrity performance”

Set-BC PEIM

The SET-BC PEIM does not address the requirements for management review.

Summary

As a result of audit interviews and document review, the audit found that:

• There is no specific section in the SET-BC PIP on Management Review other than the general statements previously described for Sections 2 and 6.1.
• Management review processes and procedures (e.g., Scorecard, Key Performance Metrics and Short-Term Incentive Pay) that were provided during the audit were not linked to the performance of the Westcoast IMP.
• In response to the Draft Audit Report, Westcoast provided the SET-West Occupational Steering Committee Short Term Incentive Pay (STIP) Scorecard for December 2012 (Scorecard) and commented that the Scorecard included Key Performance Metrics for Integrity and Measurement Compliance. The single performance metric described in the Scorecard was Cathodic Protection Effectiveness (Transmission). While this Scorecard describes one performance metric that is reviewed by management to monitor IMP performance, it was not adequate to demonstrate the required link between current management review processes and IMP performance, or that Westcoast is conducting regular management review of its IMP to assess its continued suitability, adequacy and effectiveness.
• There are ad hoc, non-formalized management reviews occurring; however, there are no documented processes for these (e.g. annual review of the PIP and SOP’s, monthly IMP meetings, annual IMP workshops).

Based on documents reviewed and interviews with operations staff, the Company was not able to demonstrate that it was in compliance with the requirements of the audit element Management Review.

Compliance Status: Non-Compliant

Date modified:

2021-09-16