WATFORD CITY — A pipeline project from Arrow Field Services, a Crestwood subsidiary, drew a little public fire during a hearing on Friday before the Public Service Commission.
Evan Whiteford, a member of Laborer’s International Union of North America, was present at the meeting to urge the Public Service Commission to provide tougher oversight of the company, and to ask more questions about who will build the project and how they will be supervised before granting a permit for two 2.6-mile pipelines about 7 miles southeast of Watford City proposed to carry products from a natural gas plant to third-party lines and facilities.
Both of the pipelines are to be installed in the same ditch and right of way, and will be constructed according to applicable state and federal laws, the company said in its application. The natural gas line will carry up to 30 million cubic feet per day, while the other will carry up to 5,000 barrels of other products per day. The combined cost of the two pipelines is $6.3 million.
A timeline for construction of the pipelines had called for starting the project in May and finishing in August.
The gas processing plant is too small to be regulated by the PSC and falls under the Department of Mineral Resources Oil and Gas Division instead. That project is referred to in its application materials as the Bear Den West gathering pipeline and processing plant.
Whiteford prefaced his comments by saying that the project itself is important, and will create needed takeaway capacity for natural gas in McKenzie
Director of Mineral Resources Director Lynn Helms noted in his May production report that the county is nearing its takeaway capacity and in danger of increased flaring. The gas plant is key to preventing that, he said at the time.
“We have been a big backer to get infrastructure like this in place,” Whiteford testified, acknowledging the flaring issue. “But with this said, there are some red flags that come up when we talk about Crestwood Midstream. They have a history of spills. I do not want the Public Service Commission to deny this application, but some of these issues need to be brought to light.”
Among the issues, Whiteford testified, is the fact that Crestwood was responsible for one of the state’s largest oil spills, a million gallons on the Fort Berthold Reservation, and then, just a year later, a 330,000 gallon brine spill.
A few weeks ago, the company was also responsible for a 25,000 gallon oil spill. That one was contained, Whiteford acknowledged, but nonetheless is yet another spill to consider.
“These instances cannot happen,” he said. “We sit here with a target on our heads. The more of these issues that arise, the harder it is to get pipelines in the ground.”
Whiteford urged the Public Service Commission to look deeper into Crestwood, citing a report from the Environmental Protection Agency at a facility in New York the company purchased in 2013.
It came with existing problems, Whiteford acknowledged. “They were looked at again in 2016, and some of the issues haven’t been resolved,” he said. “It adds to the concern with Crestwood Midstream, of which Arrow is a subsidiary.”
Whiteford also mentioned a PHMSA report from an inspection on a control room in Epping, in which some problems were also identified.
“You had owned that a year before the PHMSA inspection,” Whiteford said, suggesting there was ample time to have cleared up any issues existing prior to purchase.
Whiteford also raised questions about a contractor the company is using, which he said has several workers from WCE, a now defunct company that had several issues.
On Crestwood’s behalf, McDonough said after the hearing that Whiteford is correct in some respects about the “regrettable” history of spills for Crestwood in North Dakota.
“That being said, It’s important to note that the assets were purchased on the Fort Berthold Reservation just prior to the July 2014 spill,” he said. “Since that time, we have worked extremely closely with local and federal authorities, as well as the tribe, to make sure that we have responded above and beyond what a prudent operator would do.”
Some of the federal investigations are continuing, he added, so he couldn’t go into any details on the efforts they’ve made just yet.
“We do look forward to our opportunity to fully lay out the details of those releases and the extraordinary measures we have taken to respond to them,” he said.
Whiteford suggested during the hearing that the company might consider a responsible contractor’s policy, such as the one Summit Midstream recently adopted. Summit is responsible for a 70,000 barrel or 3 million gallon spill of produced water in the vicinity of Blacktail Creek in 2015, which is North Dakota’s largest brine spill, and then a subsequent spill in the same general area of an additional 7,854 gallons in 2016.
The Laborer’s Union International has been critical of Summit Midstream projects in the recent past, until they adopted the new responsible contractor policy.
Danielle Krause, attorney for Arrow Field Services, asked Whiteford in questioning whether he was aware of the product being used in the proposed pipeline.
Whiteford acknowledged that natural gas is a different substance than those that were spilled in the other incidents he mentioned, and added, on further questioning, that he knew the pipeline would be using a different material as well.
There are fewer safety issues with natural gas, Whiteford said.
John Schuh, PSC attorney, meanwhile had a few questions about the responsible contractor policy. The Summit Midstream policy has a floor of $8 million minimum, it was pointed out.
“What is the purpose of the ceiling?” Schuh asked.
“You gotta understand the nature of the work,” Whiteford said. “The simpler jobs that don’t really require the skill set, for example, or a little 2,000-foot lay job. There are not too many issues with that. it’s the larger projects where you get to areas where things can go wrong.”
Whiteford met with Crestwood officials immediately following the meeting, and said they were able to come to terms with them on the project.
“It’s not necessarily that they have a responsible contractor policy in place,” Whiteford said. “It’s just that they take upon themselves to take on quality contractors and do quality work.”
The PSC will hold a hearing in Bismarck to vote on the project. A date for that hearing has not been set.