Small Aircraft
Flight Crew Instrument; Flight Crew Multiengine; Flight Crew Commercial; Flight Crew Flight Instructor
Flight Crew Total 865; Flight Crew Type 718
Situational Awareness
Conflict NMAC; Deviation / Discrepancy - Procedural Published Material / Policy
Air Traffic Control Issued Advisory / Alert; Flight Crew Took Evasive Action
Procedure; Human Factors
On a training flight with a commercial single engine student around ZZZ. After performing some airwork north of the airport we came back in for a full stop landing. A pipeline patrol aircraft was patrolling a pipeline just north east of the extended runway centerline. At around 1;400 feet the student and I were on a 2 mile final. ATC was busy with a sudden increase in workload including the Pipeline aircraft. My student and I had the traffic in sight the entire time though ATC never asked us if we did. Instead the Pipeline finished his work inspecting the line and requested to exit the airspace to the southwest. This took him right through the final approach course of our runway.At that moment we saw him turn on a collision course with us. ATC would ask the Pipeline twice if he had us in sight to which he responded yes; but made no course correction. He did not hit us because my student and I made the prudent move to forget our approach profile and level off to avoid descending into this aircraft. He went under out aircraft at maybe 75 feet. After the aircraft passed we had to use a large amount of forward slip to get down to our proper glide path because of that incident and the fact that we had to level off to avoid collision. ATC allowed this aircraft to fly through the final approach course with an aircraft on approach and as a result this aircraft was too close to us. The Pipeline aircraft that called us in sight did not show up on my ADS-B; either due to altitude or other reasons; but if he saw us he intentionally passed very close to us.
A flight instructor reported an NMAC on final approach with an aircraft that had reported them in sight to the Tower.