Industry Insiders

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INGAA

The Interstate Natural Gas Association of America (INGAA) actively advocates on behalf of 25 pipeline companies in the United States and Canada. From pipeline safety and education to regulatory issues, the organization provides a united voice for its members.

Advocacy at Heart of INGAA’s Pipeline Mission

For 70 years, the companies that own and operate interstate natural gas pipelines in the United States and Canada have grown to rely on the Interstate Natural Gas Association of America.

INGAA, as it is commonly referred, is a Washington, D.C.-based trade organization that has built a reputation of advocate for the industry with regulators and legislators. In more recent years it has come to be known as a champion of pipeline safety, in 2011 establishing an industry-wide zero-incident goal.

“All of the INGAA member companies, including Kinder Morgan, benefit from membership because of INGAA’s consistent advocacy in addressing a myriad of evolving challenges faced by the interstate natural gas transmission industry, including taking a strong leadership role in pipeline safety, in the ongoing and increasing usage of gas for electric generation, and in the area of pipeline infrastructure permitting and development,” says David Devine, president of Natural Gas Pipelines, Central Region, for Kinder Morgan’s Natural Gas Pipelines group.

David Devine

David Devine

Getting its Start
Founded in 1944, INGAA came together as amendments were made to the 1938 Natural Gas Act and at a time when federal regulations began to have a stronger grip on the industry. The industry was also facing the potential of a post-war construction boom.

“There was a need for an industry voice in Washington to deal with federal regulators and the various federal laws that affected the natural gas pipeline industry,” says INGAA president Don Santa. “In addition to a legal framework coming together, all of a sudden there was this potential to expand the reach of natural gas via pipeline.”

Don Santa

Don Santa

The expansion came as a result not only of the post-war economic boom but the fact that major oil pipelines constructed to transport oil from the Gulf Coast to the Midwest during the war were converted to transport natural gas after the war.

Today, INGAA’s 25 member companies operate 220,000 miles of pipelines in two countries. In 1990, INGAA formed the now 160-member strong INGAA Foundation that incorporates most INGAA members as well as other pipeline industry ancillary companies to promote natural gas and pipeline development via reports, studies and forums on technical and economic issues.

“It (INGAA) has evolved with the industry, and the issues that it must address have evolved,” Santa says. “The early days were about the post-war boom, but it really was the infancy of the pipeline industry.”

Santa noted that the 1954 Supreme Court decision (Phillips Petroleum Co. v. Wisconsin) to extend federal regulation under the Natural Gas Act to include wellhead sales, changed the industry dramatically. “All of a sudden, the pipes and their role changed,” he says.

As federal regulations became more pervasive, INGAA’s role on the regulatory end grew and the organization built itself as the liaison between the industry and the Federal Energy Regulatory Commission (FERC) and its precursor the Federal Power Commission.

Santa says INGAA was heavily involved in the tumultuous restructuring of the industry in the 1980s and 1990s, particularly with the landmark FERC orders 436 and 636, as Congress stepped back the federal regulation of gas at the wellhead.

INGAA

Since 2011, INGAA has worked with its members on a zero-incident safety goal. The action plan was prompted by the 2010 pipeline explosion in San Bruno, Calif. The plan includes educating the industry as well as other pipeline stakeholders.

“It’s that which gave you what is the current regulatory and business model for the industry, which is the interstate natural gas pipelines as pure transporters of natural gas not buying and reselling it,” Santa says.

Devine, who is also the INGAA chairman for 2013-2014, adds, INGAA is an active voice in the North American energy dialogue through its continuous review and commentary of regulatory and legislative issues involving the industry. Beyond those borders, the trade organization provides continuing education and outreach to public and private sector stakeholders about the industry and its importance to the nation.

“Similarly, it’s important that we, as an industry, continue to explain to lawmakers, the public and others the importance of natural gas to our nation’s economy and energy security and the fact that pipelines help make today’s natural gas revolution possible,” Devine says. “INGAA works on all these fronts to represent the industry.”

The association’s activity has followed the evolution of the industry and the legal and regulatory framework around it, Santa says, adding that more recently INGAA is working more with natural resource and environmental law issues.

The organization remains focused on developing best practices and helping shape regulations that help all INGAA members step up their performance and, as Santa put it, “Making sure all boats can rise with what we learn and what we do.”

“INGAA’s role is vital in supporting its members as they assess the day-to-day and long-term risks of doing business, seek necessary capital and continue to provide the critical infrastructure that’s needed to link gas resources to consuming markets, with the ever-present objectives of doing so safely and reliably,” Devine says.

Stance on Safety
The continued evolution of INGAA also takes into account a stronger look at pipeline safety, which Santa referred to as part of the natural gas industry’s social license to do business and “job No. 1 for INGAA members.”

The stronger stance on safety started in late 2010 following the Pacific Gas & Electric pipeline explosion in San Bruno, Calif., which Santa says was a real wakeup call to the industry.

“We said we’ve really got to take ownership of this issue, and the INGAA board committed to a goal of zero pipeline accidents and then transformed that into an action plan that we are committed to. While it’s probably largely going to parallel what ultimately comes out in the new pipeline safety rules from the federal government’s Pipeline and Hazardous Materials Administration, our point was, ‘We can see where it’s going, so let’s get out ahead of it because this is an important part of our doing business,’” Santa says.

This commitment to pipeline safety is paramount when all pipelines are in the news thanks in part to projects like Keystone XL.

“On the one hand, we know that natural gas pipelines are different from oil pipelines in terms of the commodity that they carry and in terms of the legal and regulatory process they need to go through to get approved and all of that,” Santa says. “However, in the eyes of the public, pipelines are pipelines and clearly the level of attention that Keystone has gotten has heightened the public’s awareness of energy pipelines. There’s no doubt about it.”

Couple that with the shale revolution and INGAA and its members are more in the public spotlight than ever before, prompting INGAA to become more proactive in terms of promoting its safety message and promoting the benefits of pipelines to the economy and the end-user.

“It is critical that our industry tells its story and educates the public about the shale gas revolution, the related pipeline infrastructure development, and the benefits for the nation,” Devine says. “Through INGAA, we are in a better position to speak with a single clear voice about this domestic natural resource and what it means for the security of the nation.”

Along with the public’s increased awareness of natural gas and the impact it has on local and national economies and in geopolitics, comes some controversy.

“We’re clearly in a role now, where I think we’re a lot more in the public eye than we have been before,” Santa says. “You have to layer on top of that not only what’s happened in the marketplace but what’s happened in terms of communications, the Internet, social media, proliferation of news outlets, that we’re just a lot more in the public eye than we ever were before.”

Pipeline Network

The robust pipeline network in the United States and Canada is an integral part of the country realizing the benefits
of the shale revolution. Of the 300,000 miles of natural gas transmission lines in North America, 220,000 are interstate pipelines.

Shale Growth
“Today, we are experiencing a tidal wave of shale-related production, which, in my view, represents the single greatest change I have seen through my career,” Devine says. “The need to develop new infrastructure has never been greater. This energy resurgence is helping to propel the U.S. economy, create jobs and is contributing to an industrial resurgence.”

Santa views this is an exciting time thanks to the rapid transformation of the energy markets thanks to the shale boom across North America.

Six to eight years ago the assumption was that domestic gas production was on the decline and the dependence on foreign liquefied natural gas (LNG) was going to play a larger role in meeting U.S. demand.

“Production in the Marcellus Shale is going to overwhelm the ability of the markets in the Northeast and the Mid-Atlantic to absorb that gas,” Santa says. “You’re going to be seeing Marcellus gas going out of that region. A lot of it will probably go to the Gulf Coast to meet demand created for industrial production and also for export.” Santa explained that many of the proposed LNG export terminals and industrial plants, particularly plastics and other petrochemical plants, are located along the Gulf Coast.

With the development of shale gas, he predicts that upgrades and flow reversal will play a huge role in the middle and eastern parts of the country, where infrastructure is in place. In the west there is room for greenfield construction of pipelines as the industry looks to accommodate LNG exports from Canada as well as exports to Mexico.

Looking at the shale revolution, it’s appropriate that INGAA’s tag line is “Pipelines make it possible” because, as Santa points out, without the robust infrastructure in place and the known ability to add more, producers would not have the confidence to invest in natural gas. And consumers would not be able to realize the benefits of the abundance of natural gas.

Looking Ahead
“Over the years INGAA has provided unwavering member value by diligently addressing numerous industry issues, and I predict more of the same in spite of the changes — and challenges — that we now face and those not yet on the horizon,” Devine says. “Each year, INGAA tackles a host of issues, presently including pipeline safety and integrity to advancing a culture of safety, addressing methane, GHG (greenhouse gases) and other environmental initiatives, and others including gas and electric reliability, cyber security, taxation and regulatory and legislative issues.”

With the great reforms of the 1980s and 1990s well in the rear view mirror, Santa says there are a lot of bread and butter issues that INGAA continues to tackle but the two big things on the radar are addressing cyber security and positioning INGAA members to tap into the electric power plant growth.

Also of note is the release of an updated 2035 outlook (See sidebar p. 23), which was last updated in 2011. The report, published by the INGAA Foundation, updates investment projections for natural gas, natural gas liquid and oil midstream through 2035, and it provides data on the economic impacts, including jobs impacts, of that projected investment.

“Bottom line: Natural gas is the cleanest of fossil fuels, and it will be consumed by industrial users and power plants to an even greater degree in the years to come as the nation grapples with the pursuit of cleaner air and a cleaner environment,” Devine says. “The success of INGAA member companies is directly linked to the success of INGAA as the premier trade association in the natural gas industry.”

Mike Kezdi is assistant editor at Benjamin Media Inc. and a contributing staff editor of North American Oil & Gas Pipelines. Contact him at mkezdi@benjaminmedia.com.

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