Record $9.6M fine for Houston-based co. after Gulf of Mexico oil spill

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Third Stream has received a fine of $9.6 million. Photo courtesy of Third Stream

Pipeline safety regulators on Monday, January 5, assessed their largest fine ever against the company responsible for leaking 1.1 million gallons of oil into the Gulf off the coast of Louisiana in 2023. But the $9.6 million fine isn’t likely to be a major burden for Third Coast to pay.

This single fine is close to the normal total of $8 million to $10 million in all fines that the Pipeline and Hazardous Materials Safety Administration hands out each year. But Third Coast has a stake in some 1,900 miles of pipelines, and in September, the Houston-based company announced that it had secured a nearly $1 billion loan.

Pipeline Safety Trust Executive Director Bill Caram said this spill “resulted from a company-wide systemic failure, indicating the operator’s fundamental inability to implement pipeline safety regulations,” so the record fine is appropriate and welcome.

“However, even record fines often fail to be financially meaningful to pipeline operators. The proposed fine represents less than 3% of Third Coast Midstream’s estimated annual earnings,” Caram said. “True deterrence requires penalties that make noncompliance more expensive than compliance.”

The agency said Third Coast didn't establish proper emergency procedures, which is part of why the National Transportation Safety Board found that operators failed to shut down the pipeline for nearly 13 hours after their gauges first hinted at a problem. PHMSA also said the company didn't adequately assess the risks or properly maintain the 18-inch Main Pass Oil Gathering pipeline.

The agency said the company “failed to perform new integrity analyses or evaluations following changes in circumstances that identified new and elevated risk factors” for the pipeline.

That echoed what the NTSB said in its final report in June, that “Third Coast missed several opportunities to evaluate how geohazards may threaten the integrity of their pipeline. Information widely available within the industry suggested that land movement related to hurricane activity was a threat to pipelines.”

The NTSB said the leak off the coast of Louisiana was the result of underwater landslides, caused by hazards such as hurricanes, that Third Coast, the pipeline owner, failed to address despite the threats being well known in the industry.

A Third Coast spokesperson said the company has been working to address regulators' concerns about the leak, so it was taken aback by some of the details the agency included in its allegations and the size of the fine.

“After constructive engagement with PHMSA over the last two years, we were surprised to see aspects of the recent allegations that we believe are inaccurate and exceed established precedent. We will address these concerns with the agency moving forward," the company spokesperson said.

The amount of oil spilled in this incident was far less than the 2010 BP oil disaster, when 134 million gallons were released in the weeks following an oil rig explosion, but it could have been much smaller if workers in the Third Coast control room had acted more quickly, the NTSB said.

A new generation of technology is making it faster, safer, and more cost-effective to identify CUI. Courtesy photo

The case for smarter CUI inspections in the energy sector

Guest Column

Corrosion under insulation (CUI) accounts for roughly 60% of pipeline leaks in the U.S. oil and gas sector. Yet many operators still rely on outdated inspection methods that are slow, risky, and economically unsustainable.

This year, widespread budget cuts and layoffs across the sector are forcing refineries to do more with less. Efficiency is no longer a goal; it’s a mandate. The challenge: how to maintain safety and reliability without overextending resources?

Fortunately, a new generation of technologies is gaining traction in the oil and gas industry, offering operators faster, safer, and more cost-effective ways to identify and mitigate CUI.

Hidden cost of corrosion

Corrosion is a pervasive threat, with CUI posing the greatest risk to refinery operations. Insulation conceals damage until it becomes severe, making detection difficult and ultimately leading to failure. NACE International estimates the annual cost of corrosion in the U.S. at $276 billion.

Compounding the issue is aging infrastructure: roughly half of the nation’s 2.6 million miles of pipeline are over 50 years old. Aging infrastructure increases the urgency and the cost of inspections.

So, the question is: Are we at a breaking point or an inflection point? The answer depends largely on how quickly the industry can move beyond inspection methods that no longer match today's operational or economic realities.

Legacy methods such as insulation stripping, scaffolding, and manual NDT are slow, hazardous, and offer incomplete coverage. With maintenance budgets tightening, these methods are no longer viable.

Why traditional inspection falls short

Without question, what worked 50 years ago no longer works today. Traditional inspection methods are slow, siloed, and dangerously incomplete.

Insulation removal:

Disruptive and expensive.
Labor-intensive and time-consuming, with a high risk of process upsets and insulation damage.
Limited coverage. Often targets a small percentage of piping, leaving large areas unchecked.
Health risks: Exposes workers to hazardous materials such as asbestos or fiberglass.

Rope access and scaffolding:

Safety hazards. Falls from height remain a leading cause of injury.
Restricted time and access. Weather, fatigue, and complex layouts limit coverage and effectiveness.
High coordination costs. Multiple contractors, complex scheduling, and oversight, which require continuous monitoring, documentation, and compliance assurance across vendors and protocols drive up costs.

Spot checks:

Low detection probability. Random sampling often fails to detect localized corrosion.
Data gaps. Paper records and inconsistent methods hinder lifecycle asset planning.
Reactive, not proactive: Problems are often discovered late after damage has already occurred.

A smarter way forward

While traditional NDT methods for CUI like Pulsed Eddy Current (PEC) and Real-Time Radiography (RTR) remain valuable, the addition of robotic systems, sensors, and AI are transforming CUI inspection.

Robotic systems, sensors, and AI are reshaping how CUI inspections are conducted, reducing reliance on manual labor and enabling broader, data-rich asset visibility for better planning and decision-making.

ARIX Technologies, for example, introduced pipe-climbing robotic systems capable of full-coverage inspections of insulated pipes without the need for insulation removal. Venus, ARIX’s pipe-climbing robot, delivers full 360° CUI data across both vertical and horizontal pipe circuits — without magnets, scaffolding, or insulation removal. It captures high-resolution visuals and Pulsed Eddy Current (PEC) data simultaneously, allowing operators to review inspection video and analyze corrosion insights in one integrated workflow. This streamlines data collection, speeds up analysis, and keeps personnel out of hazardous zones — making inspections faster, safer, and far more actionable.

These integrated technology platforms are driving measurable gains:

Autonomous grid scanning: Delivers structured, repeatable coverage across pipe surfaces for greater inspection consistency.
Integrated inspection portal: Combines PEC, RTR, and video into a unified 3D visualization, streamlining analysis across inspection teams.
Actionable insights: Enables more confident planning and risk forecasting through digital, shareable data—not siloed or static.

Real-world results

Petromax Refining adopted ARIX’s robotic inspection systems to modernize its CUI inspections, and its results were substantial and measurable:

Inspection time dropped from nine months to 39 days.
Costs were cut by 63% compared to traditional methods.
Scaffolding was minimized 99%, reducing hazardous risks and labor demands.
Data accuracy improved, supporting more innovative maintenance planning.

Why the time is now

Energy operators face mounting pressure from all sides: aging infrastructure, constrained budgets, rising safety risks, and growing ESG expectations.

In the U.S., downstream operators are increasingly piloting drone and crawler solutions to automate inspection rounds in refineries, tank farms, and pipelines. Over 92% of oil and gas companies report that they are investing in AI or robotic technologies or have plans to invest soon to modernize operations.

The tools are here. The data is here. Smarter inspection is no longer aspirational — it’s operational. The case has been made. Petromax and others are showing what’s possible. Smarter inspection is no longer a leap but a step forward.

---

Tyler Flanagan is director of service & operations at Houston-based ARIX Technologies.

Under its deal with Occidental, pipeline company Enterprise Products Partners will create a carbon dioxide pipeline system for 1PointFive’s Bluebonnet Sequestration Hub. Photo via 1pointfive.com

Oxy, Enterprise Products Partners to collaborate on carbon dioxide pipeline system for Texas project

coming soon

Occidental Petroleum’s carbon capture, utilization, and sequestration (CCUS) subsidiary has tapped another Houston-based company to develop a carbon dioxide pipeline and transportation network for one of its CCUS hubs.

Under its deal with Occidental, pipeline company Enterprise Products Partners will create a carbon dioxide pipeline system for 1PointFive’s Bluebonnet Sequestration Hub, which will span more than 55,000 acres in Chambers, Liberty, and Jefferson counties. The hub will be able to hold about 1.2 billion metric tons of carbon dioxide. The new pipeline network will be co-located with existing pipelines.

Enterprise Products Partners also will supply fee-based services for transporting CO2 emissions from industrial facilities near the Houston Ship Channel to the Bluebonnet hub.

“This agreement pairs our expertise managing large volumes of CO2 with Enterprise’s decades of midstream experience to bring confidence to industrial customers seeking a decarbonization solution,” Jeff Alvarez, president of 1PointFive’s sequestration business, says in a news release.

The Bluebonnet Sequestration Hub recently received funding from the U.S. Department of Energy (DOE) to help cover development costs.

“This hub is located between two of the largest industrial corridors in Texas so captured CO2 can be efficiently transported and safely sequestered,” Alvarez said in 2023. “Rather than starting from scratch with individual capture and sequestration projects, companies can plug into this hub for access to shared carbon infrastructure.”

Here are some things to know about the situation with the pipeline fire burning just outside of Houston. Photo via Getty Images

What to know about the Houston pipeline fire — how it started, pollution impact, and more

latest update

A pipeline fire that forced hundreds of people to flee their homes in the Houston suburbs burned for a third day Wednesday, with officials saying they don't expect it to be extinguished until sometime Thursday evening.

Officials said residents who had to evacuate would be allowed to return to their homes starting Wednesday evening.

Authorities have offered few details about what prompted the driver of an SUV to hit an aboveground valve on the pipeline on Monday, sparking the blaze.

Here are some things to know about the situation with the pipeline fire:

What caused the fire?

Officials say the underground pipeline, which runs under high-voltage power lines in a grassy corridor between a Walmart and a residential neighborhood in Deer Park, was damaged when the SUV driver left the store's parking lot, entered the wide grassy area and went through a fence surrounding the valve equipment.

Authorities have offered few details on what caused the vehicle to hit the pipeline valve, the identity of the driver or what happened to them. The pipeline company on Wednesday called it an accident. Deer Park officials said preliminary investigations by police and FBI agents found no evidence of a terrorist attack.

Deer Park police won't be able to reach the burned-out vehicle until the flame has been extinguished. Once the area is safe, the department will be able to continue its investigation and confirm specifics, city spokesperson Kaitlyn Bluejacket said in an email Wednesday.

The valve equipment appears to have been protected by a chain-link fence topped with barbed wire. The pipeline's operator has not responded to questions about any other safety protections that were in place.

Who is responsible for the pipeline?

Energy Transfer is the Dallas-based owner of the pipeline, a 20-inch-wide (50-centemeter-wide) conduit that runs for miles through the Houston area.

It carries natural gas liquids through the suburbs of Deer Park and La Porte, both of which are southeast of Houston. Energy Transfer said the fire had diminished overnight and was continuing to “safely burn itself out” on Wednesday.

Energy Transfer also built the Dakota Access Pipeline, which has been at the center of protests and legal battles. The company’s executive chairman, Kelcy Warren, has given millions of dollars in campaign contributions to Republican Texas Gov. Greg Abbott.

What's being done to extinguish the fire?

Energy Transfer said its crews were working Wednesday to install specialized isolation equipment on both sides of the damaged section that will help extinguish the fire.

Once the equipment is installed, which could take several hours of welding, the isolated section of the pipeline will be purged with nitrogen, which will extinguish the fire, company and local officials said. After that, damaged components can be repaired.

“The safest way to manage this process is to let the products burn off,” Energy Transfer said.

Late Wednesday afternoon, Deer Park officials said repair work on the pipeline to help speed up the process to put out the fire wasn't expected to be completed until 6 p.m. on Thursday. Once finished, the fire was anticipated to be extinguished within two to three hours.

How have residents been impacted?

Authorities evacuated nearly 1,000 homes at one point and ordered people in nearby schools to shelter in place. Officials said that starting at 6 p.m. on Wednesday, residents in Deer Park and La Porte who had to evacuate would be allowed to return to their homes. A portion of a highway near the pipeline would remain closed, officials said.

Hundreds of customers lost power. Officials said Wednesday afternoon that only two customers remained without electricity in the Deer Park and La Porte area. Repairs to all of the power distribution lines affected by the fire had been completed.

Deer Park's statement said Energy Transfer was “prioritizing the safety of the community and environment as it implements its emergency response plan.”

“We appreciate the patience and understanding of all residents during this ongoing situation,” Deer Park officials said.

By late Tuesday, about 400 evacuees remained, and some expressed frustration over being forced to quickly flee and not being given any timeline for when they will be able to return.

“We literally walked out with the clothes on our backs, the pets, and just left the neighborhood with no idea where we were going,” said Kristina Reff, who lives near the fire. “That was frustrating.”

What about pollution from the fire?

Energy Transfer and Harris County officials have said that air quality monitoring shows no immediate risk to individuals, despite the huge tower of billowing flame that shot hundreds of feet into the air, creating thick black smoke that hovered over the area.

Houston is the nation’s petrochemical heartland and is home to a cluster of refineries and plants and thousands of miles of pipelines. Explosions and fires are a familiar sight, and some have been deadly, raising recurring questions about industry efforts to protect the public and the environment.

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Why 2026 must be the year Texas makes transmission as its top energy priority

guest column

Texas takes pride in running one of the most dynamic and deregulated energy markets in the world, but conversations about electricity rarely focus on what keeps it moving: transmission infrastructure.

As ERCOT projects unprecedented electricity demand growth and grid operators update their forecasts for 2026, it’s becoming increasingly clear that generation, whether renewable or fossil, is only part of the solution. Transmission buildout and sound governing policy now stand as the linchpin for reliability, cost containment, and long-term resilience in a grid under unprecedented stress.

At the heart of this urgency is one simple thing: demand. Over 2024 and 2025, ERCOT has been breaking records at a pace we haven’t seen before. From January through September of 2025 alone, electricity use jumped more than 5% over the year before, the fastest growth of any major U.S. grid. And it’s not slowing down.

The Energy Information Administration expects demand to climb another 14% in 2026, pushing total consumption to roughly 425 terawatt-hours in just the first nine months. That surge isn’t just about more people moving to Texas or running their homes differently; it’s being driven by massive industrial and technology loads that simply weren’t part of the equation ten years ago.

The most dramatic contributor to that rising demand is large-scale infrastructure such as data centers, cloud computing campuses, crypto mining facilities, and electrified industrial sectors. In the latest ERCOT planning update, more than 233 gigawatts of total “large load” interconnection requests were being tracked, an almost 300% jump over just a year earlier, with more than 70% of those requests tied to data centers.

Imagine hundreds of new power plants requesting to connect to the grid, all demanding uninterrupted power 24/7. That’s the scale of the transition Texas is facing, and it’s one of the major reasons transmission planning is no longer back-of-house policy talk but a central grid imperative.

Yet transmission is complicated, costly, and inherently long-lead. It takes three to six years to build new transmission infrastructure, compared with six to twelve months to add a new load or generation project.

This is where Texas will feel the most tension. Current infrastructure can add customers and power plants quickly, but the lines to connect them reliably take time, money, permitting, and political will.

To address these impending needs, ERCOT wrapped up its 2024 Regional Transmission Plan (RTP) at the end of last year, and the message was pretty clear: we’ve got work to do. The plan calls for 274 transmission projects and about 6,000 miles of new, rebuilt, or upgraded lines just to handle the growth coming our way and keep the lights on.

The plan also suggests upgrading to 765-kilovolt transmission lines, a big step beyond the standard 345-kV system. When you start talking about 765-kilovolt transmission lines, that’s a big leap from what Texas normally uses. Those lines are built to move a massive amount of power over long distances, but they’re expensive and complicated, so they’re only considered when planners expect demand to grow far beyond normal levels. Recommending them is a clear signal that incremental upgrades won’t be enough to keep up with where electricity demand is headed.

There’s a reason transmission is suddenly getting so much attention. ERCOT and just about every industry analyst watching Texas are projecting that electricity demand could climb as high as 218 gigawatts by 2031 if even a portion of the massive queue of large-load projects actually comes online. When you focus only on what’s likely to get built, the takeaway is the same: demand is going to stay well above anything we’ve seen before, driven largely by the steady expansion of data centers, cloud computing, and digital infrastructure across the state.

Ultimately, the decisions Texas makes on transmission investment and the policies that determine how those costs are allocated will shape whether 2026 and the years ahead bring greater stability or continued volatility to the grid. Thoughtful planning can support growth while protecting reliability and affordability, but falling short risks making volatility a lasting feature of Texas’s energy landscape.

Transmission Policy: The Other Half of the Equation

Infrastructure investment delivers results only when paired with policies that allow it to operate efficiently and at scale. Recognizing that markets alone won’t solve these challenges, Texas lawmakers and regulators have started creating guardrails.

For example, Senate Bill 6, now part of state law, aims to improve how large energy consumers are managed on the grid, including new rules for data center operations during emergencies and requirements around interconnection. Data centers may even be required to disconnect under extreme conditions to protect overall system reliability, a novel and necessary rule given their scale.

Similarly, House Bill 5066 changed how load forecasting occurs by requiring ERCOT to include utility-reported projections in its planning processes, ensuring transmission planning incorporates real-world expectations. These policy updates matter because grid planning isn’t just a technical checklist. It’s about making sure investment incentives, permitting decisions, and cost-sharing rules are aligned so Texas can grow its economy without putting unnecessary pressure on consumers.

Without thoughtful policy, we risk repeating past grid management mistakes. For example, if transmission projects are delayed or underfunded while new high-demand loads come online, we could see congestion worsen. If that happens, affordable electricity would be located farther from where it’s needed, limiting access to low-cost power for consumers and slowing overall economic growth. That’s especially critical in regions like Houston, where energy costs are already a hot topic for households and businesses alike.

A 2026 View: Strategy Over Shortage

As we look toward 2026, here are the transmission and policy trends that matter most:

Pipeline of Projects Must Stay on Track: ERCOT’s RTP is ambitious, and keeping those 274 projects, thousands of circuit miles, and next-generation 765-kV lines moving is crucial for reliability and cost containment.
Large Load Forecasting Must Be Nuanced: The explosion in large-load interconnection requests, whether or not every project materializes, signals demand pressure that transmission planners cannot ignore. Building lines ahead of realized demand is not wasteful planning; it’s insurance against cost and reliability breakdowns.
Policy Frameworks Must Evolve: Laws like SB 6 and HB 5066 are just the beginning. Texas needs transparent rules for cost allocation, interconnection standards, and emergency protocols that keep consumers protected while supporting innovation and economic growth.
Coordination Among Stakeholders Is Critical: Transmission doesn’t stop at one utility’s borders. Regional cooperation among utilities, ERCOT, and local stakeholders is essential to manage congestion and develop systemwide reliability solutions.

Here’s the bottom line: Generation gets the headlines, but transmission makes the grid work. Without a robust transmission buildout and thoughtful governance, even the most advanced generation mix that includes wind, solar, gas, and storage will struggle to deliver the reliability Texans expect at a price they can afford.

In 2026, Texas is not merely testing its grid’s capacity to produce power; it’s testing its ability to move that power where it’s needed most. How we rise to meet that challenge will define the next decade of energy in the Lone Star State.

———

Sam Luna is director at BKV Energy, where he oversees brand and go-to-market strategy, customer experience, marketing execution, and more.

New Gulf Coast recycling plant partners with first-of-kind circularity hub

now open

TALKE USA Inc., the Houston-area arm of German logistics company TALKE, officially opened its Recycling Support Center earlier this month.

Located next to the company's Houston-area headquarters, the plant will process post-consumer plastic materials, which will eventually be converted into recycling feedstock. Chambers County partially funded the plant.

“Our new recycling support center expands our overall commitment to sustainable growth, and now, the community’s plastics will be received here before they head out for recycling. This is a win for the residents of Chambers County," Richard Heath, CEO and president of TALKE USA, said in a news release.

“The opening of our recycling support facility offers a real alternative to past obstacles regarding the large amount of plastic products our local community disposes of. For our entire team, our customers, and the Mont Belvieu community, today marks a new beginning for effective, safe, and sustainable plastics recycling.”

The new plant will receive the post-consumer plastic and form it into bales. The materials will then be processed at Cyclyx's new Houston Circularity Center, a first-of-its-kind plastic waste sorting and processing facility being developed through a joint venture between Cyclix, ExxonMobil and LyondellBasell.

“Materials collected at this facility aren’t just easy-to-recycle items like water bottles and milk jugs. All plastics are accepted, including multi-layered films—like chip bags and juice pouches. This means more of the everyday plastics used in the Chambers County community can be captured and kept out of landfills,” Leslie Hushka, chief impact officer at Cyclyx, added in a LinkedIn post.

Cyclyx's circularity center is currently under construction and is expected to produce 300 million pounds of custom-formulated feedstock annually.

Houston quantum simulator research reveals clues for solar energy conversion

energy flow

Rice University scientists have used a programmable quantum simulator to mimic how energy moves through a vibrating molecule.

The research, which was published in Nature Communications last month, lets the researchers watch and control the flow of energy in real time and sheds light on processes like photosynthesis and solar energy conversion, according to a news release from the university.

The team, led by Rice assistant professor of physics and astronomy Guido Pagano, modeled a two-site molecule with one part supplying energy (the donor) and the other receiving it (the acceptor).

Unlike in previous experiments, the Rice researchers were able to smoothly tune the system to model multiple types of vibrations and manipulate the energy states in a controlled setting. This allowed the team to explore different types of energy transfer within the same platform.

“By adjusting the interactions between the donor and acceptor, coupling to two types of vibrations and the character of those vibrations, we could see how each factor influenced the flow of energy,” Pagano said in the release.

The research showed that more vibrations sped up energy transfer and opened new paths for energy to move, sometimes making transfer more efficient even with energy loss. Additionally, when vibrations differed, efficient transfer happened over a wider range of donor–acceptor energy differences.

“The results show that vibrations and their environment are not simply background noise but can actively steer energy flow in unexpected ways,” Pagano added.

The team believes the findings could help with the design of organic solar cells, molecular wires and other devices that depend on efficient energy or charge transfer. They could also have an environmental impact by improving energy harvesting to reduce energy losses in electronics.

“These are the kinds of phenomena that physical chemists have theorized exist but could not easily isolate experimentally, especially in a programmable manner, until now,” Visal So, a Rice doctoral student and first author of the study, added in the release.

The study was supported by The Welch Foundation,the Office of Naval Research, the National Science Foundation CAREER Award, the Army Research Office and the Department of Energy.

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