"Federal pipeline regulators and ExxonMobil lawyers will spar Wednesday in Houston over a proposed $2.7 million fine and allegations that the company delayed crucial inspections, skewed risk data and ignored warning signs before its Pegasus oil pipeline ruptured in Arkansas last year.
The two sides are presenting evidence for and against the fine and allegations in an "informal" administrative hearing that's closed to the public. It is being heard by a presiding officer from the Pipeline and Hazardous Materials Safety Administration (PHMSA), according to Damon Hill, spokesman for the regulatory agency. A final ruling could take six months or longer.
PHMSA's Pegasus case is being closely watched by pipeline opponents who question the government's ability to stand up to oil company pressure and protect the public from harmful—and sometimes deadly—incidents involving oil pipelines and railroad cars filled with crude.
'What gets everybody really suspicious is that you don't have access to watch it, which raises all kinds of issues about transparency,' said Richard Kuprewicz, a pipeline safety consultant who serves on PHMSA’s safety standards advisory board for oil pipelines. 'The pipeline is owned by the company, but it's running through public assets, so [the closed process] tends to be frustrating.'"