New PHMSA Rules Make Pipeline Owners and Operaters Subject to Higher Civil Penalties

On October 17, 2016 the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued a policy statement advising owners and operators of oil and gas pipeline that the PHMSA will post its civil penalty framework to its website “in order to provide greater transparency regarding administrative civil penalties.”  The PHMSA website is available at http://www.phmsa.dot.gov/.   

Pursuant to the Pipeline Safety Act of 2011 PHMSA increased the maximum administrative civil penalties for violations to $200,000 per violation per day, with a maximum of $2,000,000 for a related series of violations. These administrative civil penalty maximums apply to violations that occur or are discovered after January 3, 2012. The policy statement also confirmed that the PHMSA increased the amount of civil penalties as adjusted for inflation under the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015.  For an administrative civil penalty that occurs on or after August 1, 2016, the maximum civil penalty limit was increased to $205,638 per day and $2,056,380 for a related series of violations. 

Click here for a link to the policy statement.