Pa. approves $200,000 fine and orders 'remaining life’ study of leaky 89-year-old Sunoco pipeline

State regulators on Thursday finalized a settlement with Sunoco Pipeline to atone for a 2017 leak from the aging Mariner East 1 pipeline that includes a $200,000 fine and a promise to conduct a “remaining life” study of the nearly 90-year-old pipeline.

The Pennsylvania Public Utility Commission unanimously adopted a recommended decision by Administrative Law Judge Elizabeth H. Barnes, which requires the study be completed six months after an independent expert is selected to conduct it. A redacted summary of the study will be released to the public.

The PUC cited Sunoco in 2018 for the April 2017 leak, during which 840 gallons, or 20 barrels, of highly volatile natural gas liquids escaped from a small hole that formed in the eight-inch diameter steel pipeline in New Morgan, Berks County.

The PUC cited Sunoco for having inadequate cathodic protection of the pipeline, which allowed it to corrode and to leak ethane and propane. The material bubbled to the surface and evaporated without causing injury or explosion, but the episode heightened concerns about what might happen if the 300-mile pipeline experienced a larger failure.

Sunoco replaced an 83-foot section of pipe.

The pipeline, built by Atlantic Refining in 1931 to deliver motor fuel and heating oil from its Philadelphia refinery to Western Pennsylvania, was acquired by Sunoco in 1988. Sunoco Pipeline in 2014 patched up and converted the pipeline, now renamed Mariner East, to carry gas liquids from the Marcellus Shale fields to a terminal in Marcus Hook.

Sunoco, a subsidiary of Energy Transfer LP of Dallas, is building two new Mariner East pipelines along roughly the same path as the older pipeline to carry additional gas liquids to its Delaware County terminal. The contentious project, much delayed by construction mishaps, is nearing completion this year. But it is still being litigated in several venues, including the PUC.

The agreement allows Sunoco to recommend three independent experts to conduct the remaining life study, from which the PUC’s Bureau of Investigation and Enforcement will choose one.

The remaining life study, first publicly suggested by Gov. Tom Wolf a year ago, will assess the longevity of the Mariner East 1, including risks. “The information collected in this study will be invaluable for any determinations regarding the operations of Mariner East 1," Gladys Brown Dutrieuille, the PUC’s chair, said Thursday.

The PUC on Thursday modified the agreement to also require the engineering firm that conducts the study to disclose any previous work for Sunoco or Energy Transfer.

If no adverse comments are received in the next 10 days, the settlement is approved. Sunoco will then have 30 days to recommend experts to the PUC, and the PUC’s enforcement unit will have a month to make a selection. Sunoco will pay the costs of the study.

Barnes, who has heard many of the complaints against the Mariner East project, dismissed suggestions from Sunoco’s adversaries that the fine was too small. She said the $200,000 penalty was reasonable, given that Sunoco had cooperated with investigators, and had agreed to additional conditions, including the study.

The settlement resolves one of several ongoing legal inquiries into Energy Transfer’s conduct in Pennsylvania. The Pennsylvania Department of Environmental Protection in January fined Energy Transfer a record $30.6 million related to the 2018 explosion of its Revolution Pipeline in Beaver County. That agreement lifted an 11-month permit freeze on the company’s other pipeline projects, including the cross-state Mariner East pipelines.

Energy Transfer also disclosed in November that the U.S. attorney for the Western District of Pennsylvania had issued a subpoena for documents related to the Revolution explosion. The company, in its most recent financial filings, repeated the same language from its November disclosure, and said the scope of the federal investigation is not known.