FAQ – Miscellaneous Order for Mechanical Properties of Pipe or Components

What is a “Miscellaneous Order”?

Miscellaneous Orders (MO) approve miscellaneous matters, such as the upgrading of maximum authorized operating pressures, conveyance, sale or lease of a pipeline or parts thereof, abandonment of pipelines, etc. MO’s may stipulate certain conditions a company must meet in order to be compliant.

What is this MO intended to do?

The purpose of this MO is to have an ongoing requirement for companies to notify the NEB of any pipe or components received, installed, or in service, that do not meet the mechanical property requirements of industry standards or company specifications.

Specifically, the MO will require:

  • Companies to have an ongoing requirement to notify the NEB of any pipe or components received, installed, or in service, that do not meet the mechanical property requirements of industry standards or company specifications.
  • A company’s Accountable Officer (AO) to confirm that its QA Program has been improved with the objective of preventing future instances of pipe or components not meeting specifications from occurring.
  • A company’s AO to confirm that the company has conducted an engineering assessment (EA) to verify that the pipe or components remain fit for service (where required).
  • When requested by the NEB, companies must provide completed EA’s under this Order. The NEB could make this request for several reasons, including validation of compliance with the MO.
  • In addition, the NEB could conduct targeted implementation assessment meetings or specific inspections to evaluate the EA and the criteria the EA used to assess the safety of the pipeline and related facilities.

Why did the NEB release a Draft Miscellaneous Order prior to finalizing the MO?

The NEB wanted input from Canadians and NEB-regulated companies regarding how the draft MO, if made final, would impact those companies and/or to ensure all provisions were clear – for example:

  • obtaining companies’ views on whether or not certain stipulated provisions could be carried out;
  • helping to identify if other provisions should be added or modified; and
  • specifying the scope of the requirements so that companies will be more accurate in reporting.

Why is there no end date for this MO?

The NEB recognizes that addressing this industry wide concern cannot be done overnight and that it will require time. All regulated companies are expected to have fully implemented management systemsFootnote 1 that include provisions for continual improvement. Over time these companies gain a better understanding of the factors they need to consider to address this issue in their management system, and as a result will make the necessary changes in their processes. The NEB however wants to be kept informed of all instances of pipe or components not meeting specifications in order to maintain its oversight and also to be able to intervene when it deems necessary.

What changes were made to the Draft MO as a result of these comments?

The comments received were made where it was thought to increase clarity on the scope of the MO. Significant changes from the draft version of the MO include:

  • Clarification that the order does not apply to pipe or components that companies have already notified the Board about pursuant to MO-001-2016.
  • Specification that the Board is interested in pipe and components at all stages: received, installed, and in service.
  • Changing the phrase “material properties” to “mechanical properties” to align with CSA definitions and clarify that this MO is not intended to apply to defects such as minor damage during transport or coating defects.
  • Clarification that “required specifications” refers to both industry standards as well as company specifications.
  • Separating required actions for pipe and components that have been or will be installed from those for pipe and components that have not been and will not be installed.

What happens if a company is non-compliant with the MO?

If an NEB-regulated company is found to be non-compliant with the MO (for example not producing an EA when requested), the NEB can take advantage of a number of enforcement tools, including issuing Order(s) to that specific company to compel its compliance, issuing Administrative Monetary Penalties, or revoking a company’s authorization to operate.

Have more questions?

Check out our FAQ on Pipeline Fittings.

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