This sprite is used in pairs. You can carry them around, and when you enter one of them, like a pipe, you'll be teleported to the other end.
You can have up to four different pairs in a level at the same time, which act independently of each other and are distinguished by their color. The pairing depends on the extra byte.
A pair of pipes only works when there are exactly two of them in the level, and both are spawned (=the player has encountered both); they won't let you enter otherwise.
I really hate having to reject this sprite, but unfortunately, you can hardlock the game if you trigger a message box then you enter the pipe right before the message appears, forcing you to restart the game. Even if a rare condition, any issue that requires the player to lose progress is in itself an instant rejection reason.
Here's two additional small issues I found, not really rejection issues but more as a note:
If you enter a pipe that's just slightly off-screen in the first screen, you'll die in a really funny manner. Same if it's completely gone, though the player sprite won't appear in that case. I recommend making it so you can't enter a pipe if the second one is in contact with a level edge.
You can enter a pipe when it's inside Yoshi's mouth; it'll keep the coordinates it used to have before being swallowed.