For Immediate Release
October 17, 2000

Pepco s plan to restore to service its underground oil pipeline in southern Maryland has received preliminary approval from the Office of Pipeline Safety, U.S. Department of Transportation. Implementation of the plan over the next four to six months with oversight from OPS is necessary before the pipeline can reopen.

The 52-mile pipeline, which originates at Piney Point, Md., on the Potomac River, delivers fuel oil to Pepco s two power plants in southern Maryland--Chalk Point in Prince George s County and Morgantown in Charles County. The pipeline is a crucial element in meeting demands for electricity for the people of southern Maryland and the Washington metropolitan area.

The pipeline has been shut down since April 7, when more than 100,000 gallons of oil leaked into Swanson s Creek near Pepco s Chalk Point plant. Pepco had contained the oil in the creek for more than 24 hours, but an intense storm the next day blew oil over containment booms into the Patuxent River. Pepco has continued to work with government agencies and the nearby communities to restore the Patuxent River shoreline environment.

The plan addresses all corrective actions imposed by OPS last spring.

"We hope to reassure the community, regulators and ourselves that we are taking the necessary steps to prevent another pipeline incident from occurring," said Bill Sim, Pepco Vice President, Generation. "We have employed the expertise of some of the top pipeline managers in the nation in developing the plan, which we designed to meet best industry practices and exceeds OPS requirements."

Sim said a thorough review of pipeline inspection data by outside experts found no other defect along the pipeline route like the one that caused the April 7 failure. Despite the findings of the review, Sim said Pepco will excavate at several critical locations to ensure the safety of the pipeline.

A critical element of the plan is to upgrade pipeline instrumentation and control systems that will provide operators with greatly enhanced capability to detect and quickly react to any potential leaks or other abnormal situations. In other measures, Pepco will test the safety of the pipeline by pressurizing it with water at a pressure higher than the line would be exposed to in regular operations; replace the failed section of the pipeline; and implement revisions and enhancements to operator training and procedures.

In its commitment to keep residents and government and elected officials informed, the company is sending letters describing these plans to all property owners who are adjacent to the pipeline and other stakeholders.

Last summer, Pepco agreed to sell its power plants to Southern Energy, Inc., which will assume ownership of the plants and the pipeline when the sale closes later this year. Southern Energy is committed to operating the pipeline safely and efficiently.

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