{"operation":"document","citation":"CPF 120055017","title":"PRODUCTS (SE) PIPE LINE CORPORATION — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2005-11-10","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.402(a), 195.402(d)(1)(iv), 195.404(a)(1)(iv).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-120055017.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-120055017.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-120055017","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/120055017","body":"Notice of Probable Violation involving PRODUCTS (SE) PIPE LINE CORPORATION. PHMSA's enforcement data identifies the cited regulations as 195,  195.402(a),  195.402(d)(1)(iv),  195.404(a)(1)(iv). The case was opened on 2005-11-10 and is reported as closed as of 2009-04-14. Proposed civil penalty: $155,000. Assessed civil penalty: $155,000. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n120055017_FinalOrder_03272009.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120055017/120055017_FinalOrder_03272009.pdf\n\n120055017_FinalOrder_03272009_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120055017/120055017_FinalOrder_03272009_text.pdf\n\n120055017_FinalOrder_03272009_text.pdf\n\nMarch 27, 2009\nMr. Thomas A. Bannigan\nPresident, Plantation Pipe Line Company\n500 Dallas Street, Suite 1000\nHouston, Texas 77002\nRE: CPF No. 1-2005-5017\nDear Mr. Bannigan:\nEnclosed is the Final Order in the above-referenced case. It makes findings of violation\nand assesses a civil penalty of $155,000. The penalty payment terms are set forth in the Final\nOrder. This enforcement action closes automatically upon payment. Your receipt of this Final\nOrder constitutes service of that document under 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nJeffrey D. Wiese\nAssociate Administrator\nfor pipeline Safety\nEnclosure\ncc: Mr. Ron McClain, Vice-President, Product Pipelines, Kinder Morgan, Inc.\n500 Dallas Street, Suite 1000, Houston, Texas 77002\nMs. Jessica Toll, Assistant General Counsel, Kinder Morgan, Inc.\nP. O. Box 281304, Lakewood, Colorado 80228\nMr. Byron Coy, Director, Eastern Region, OPS\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED [7005 0390 0005 6163 7442]\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\n________________________________________________\n)\nIn the Matter of )\n)\n)\nPlantation Pipe Line Company, ) CPF No. 1-2005-5017\na subsidiary of Kinder Morgan Energy Partners, L.P., )\n)\nRespondent. )\n________________________________________________)\nFINAL ORDER\nBetween July 20-23, 2004, and July 27-30, 2004, pursuant to 49 U.S.C. § 60117, a representative\nof the Virginia State Corporation Commission (SCC), as agent for the Pipeline and Hazardous\nMaterials Safety Administration (PHMSA), Office of Pipeline Safety (OPS), conducted an on-\nsite safety inspection of the hazardous liquid pipeline facilities and records of Plantation Pipe\nLine Company (Plantation or Respondent), a subsidiary of Kinder Morgan Energy Partners, L.P.,\nat its Washington Station and Roanoke Terminal facilities in Virginia. Respondent operates a\n3,100-mile petroleum pipeline system in the southeastern United States that runs from Louisiana\nto Washington, D.C.\nAs a result of the inspection, the Director, Eastern Region OPS (Director), issued to Respondent,\nby letter dated November 10, 2005, a Notice of Probable Violation and Proposed Civil Penalty\n(Notice). In accordance with 49 C.F.R. § 190.207, the Notice proposed finding that Respondent\nhad committed certain violations 49 C.F.R. §§ 195.402(a), 195.402(d)(1)(iv), and\n195.404(a)(1)(iv), and proposed assessing a civil penalty of $155,000 for the alleged violations.\nBy letter dated December 22, 2005, Respondent submitted a Response to the Notice (Response).\nPlantation contested the allegations of violation, provided information to demonstrate its\ncompliance with the cited regulations, and requested withdrawal of the Notice and elimination of\nthe proposed civil penalties. Respondent also requested a hearing if OPS decided not to\nwithdraw the Notice. A hearing was subsequently held on June 7, 2006, in Washington, D.C.,\nwith Renita K. Bivins, Esquire, Office of Chief Counsel, PHMSA, presiding. At the hearing,\nRespondent was represented by counsel. Respondent submitted a post-hearing statement by\nletter dated June 29, 2006 (Closing).\n\n\n\n2\nFINDINGS OF VIOLATION\nItem 1 in the Notice alleged that Respondent violated 49 C.F.R. §195.402(a), which states:\n§ 195.402. Procedural manual for operations, maintenance, and\nemergencies.\n(a) General. Each operator shall prepare and follow for each pipeline\nsystem a manual of written procedures for conducting normal operations\nand maintenance activities and handling abnormal operations and\nemergencies. This manual shall be reviewed at intervals not exceeding\n15 months, but at least each calendar year, and appropriate changes\nmade as necessary to insure that the manual is effective. . . .\nItem 1 of the Notice alleged that Respondent violated § 195.402(a) by failing to review its\nFacility Response Plan (Plan) at the Washington Station facility, at intervals not exceeding 15\nmonths but at least each calendar year, and to make appropriate changes as necessary to insure\nthat the Plan was effective. Specifically, Section 1.4 of the Plan stated that personnel should, “at\nleast once per year, review and make appropriate revisions as required by changes in the names\nand telephone numbers detailed in Section 2.” The Notice alleged that the last revision to this\nsection of the Plan prior to the July 2004 inspection was in November 2001 and that a discussion\nwith Plantation’s operating supervisor at the time of the inspection confirmed that the Plan had\nnot been properly reviewed and updated. During the hearing, an SCC representative testified\nthat the inspection revealed that the list of names and telephone numbers in the Plan failed to\nreflect the current area code for the facility as of 2004; the area code changed between the end of\n2001 and beginning of 2002.\nBefore and during the hearing, Respondent argued that the Plan had been reviewed each calendar\nyear, as required by § 195.402(a), and that it had conducted both a corporate and local review of\nthe Plan in years 2002 and 2003. Plantation personnel testified that the Plan had also been used\nduring its annual Hazwoper training in 2002 and 2003, which added an additional level of\nreview. The annual “tabletop exercise” conducted during the Hazwoper training was designed to\ndemonstrate Respondent’s readiness in executing the provisions of the Plan.\nRespondent further argued that during the OPS inspection, approximately 5-10 emergency\nresponder telephone numbers from the Plan had been randomly selected and checked to verify\ntheir accuracy. All the numbers dialed were correct. Although Respondent acknowledged that\nthe pages reviewed by the inspector had not been revised since November 2001, it contended that\nthe Plan had, in fact, been reviewed in 2002 and 2003. The local right-of-way technician for the\nWashington Station stated that although he did not have any documentation substantiating the\ndates of such reviews, he was sure that they had been conducted. According to Plantation, no\nrevisions had been made to the Plan’s telephone contact list because the contact numbers were\ncorrect. Furthermore, the list was updated on an ongoing basis at the company’s Control Center\nin Alpharetta, Georgia, and placed on Respondent’s intranet for access by field personnel.\nI have given full consideration to all of the evidence and arguments presented by OPS and\nRespondent. Despite Plantation’s contention that it conducted timely reviews of the Plan, the\n\n\n\n3\nrecord shows that no revisions had been made to the Plan since 2001, that the company failed to\ndocument any reviews since that time, and that its operating supervisor acknowledged not having\nreviewed the Plan. Accordingly, I find that Respondent violated 49 C.F.R. § 195.402(a) by\nfailing to review, at the required interval, its manual of written procedures for operations,\nmaintenance and emergencies to insure that the manual was effective.\nItem 2 of the Notice alleged that Respondent violated 49 C.F.R. § 195.402(d)(1)(iv), which\nstates:\n§ 195.402 Procedural manual for operations, maintenance, and\nemergencies.\n(a) . . . .\n(d) Abnormal operations. The manual required by paragraph (a) of this\nsection must include procedures for the following to provide safety when\noperating design limits have been exceeded:\n(1) Responding to, investigating, and correcting the cause of: . .\n(iv) Operation of any safety device; . . . .\nItem 2 of the Notice alleged that Plantation violated § 195.402(d)(1)(iv) by failing to follow its\nown local operating procedures that provided for the operation of safety devices when the\noperating design limits of its facilities were exceeded. Specifically, the Notice alleged that on\nMarch 25, 2004, the interface tank at the Washington Station experienced a high tank level\nalarm, indicating that the tank’s operating design limits had been exceeded and causing the\n(incoming) block valve and pressure reducing valve to close.1\nThe Notice alleged that\nPlantation’s Control Center Team Leader gave permission to bypass the high tank alarm, relieve\nthe line pressure, and restart the mainline, in violation of a company procedure entitled,\n“Requisite Relief Capacity, Tank 113, Local Operating Procedures Washington Station,” dated\nNovember 15, 2000 (Tank 113 Procedure). That procedure states,\n“Under no circumstances,\nduring normal operating conditions, should the High Level Alarm, on Tank 113, be exceeded.”\nAccording to the Notice, operating Tank 113 at a level above its operating design could have\ncaused a release of product.\nIn its written submissions and at the hearing, Respondent raised several defenses to this\nallegation but argued primarily that the Tank 113 Procedure was not in effect at the time of the\nincident.\n2\nOn the contrary, Plantation contended that the local procedure “was a remnant of\nhistorical operations when the facility was operated locally and no longer valid for current\noperations.” The company presented evidence to show that the Washington Station had been\n1 The Notice indicated that Tank 113 also served as relief flow for the company’s 14W mainline.\n2 In its Response, Plantation also asserted that the high level tank alarm was not a “safety device”, as defined under\n§ 195.402(d)(1)(iv), for Tank 113 and that during the March 25, 2004, incident, the capacity design limit of the tank\nwas never exceeded. Response, at 3, 4. It is unnecessary to reach these defenses because, as noted below,\nPlantation treated the incident as a violation of the company’s own procedures for operating a safety device by\ncompleting an Accident/Near Miss Notification report.\n\n\n\n4\noperated remotely by Plantation’s Control Center in Alpharetta, Georgia, since July 2003 and\ncontended that the Tank 113 Procedure should never have been provided to the SCC inspector.3\nAmong the documents submitted by Plantation were copies of Memorandum of Change (MOC)\nProcedure #1529, and other related emails and paperwork, which, the company argued, showed\nthat certain operational changes at the Washington Station were in the process of taking place\nwhen the March 25, 2004, incident occurred. According to Plantation, these procedures allowed\nRespondent to bypass the high level alarm on Tank 113.\nDuring the hearing, OPS responded by asserting that the agency had not received any\ndocumentation showing that Plantation had actually implemented any procedure other than the\nTank 113 Procedure as of the date of the incident. As for the MOC Procedure #1529, OPS\npersonnel pointed out that the document lacked any effective date. Respondent eventually\nacknowledged during the hearing and in its Closing that the MOC Procedure #1529 and other\nchanges at the Washington Station were still in the company’s approval process when the March\n25, 2004, incident occurred and were not finally approved until March 26, 2004.\n4\nThe company\nnever presented any documentation showing that the Tank 113 Procedure had been superseded\nor had become obsolete as of the date of the incident.\nOn the contrary, the record shows that Plantation’s own personnel considered the incident to be\nan abnormal operation under the company’s operating procedures. OPS produced an\n“Accident/Near Miss Notification” report that Plantation personnel filed the day after the\nincident, based upon the Control Center Team Leader’s action in overriding the Tank 113\nProcedure.\n5\nOn the same day that the report was filed, the company finally approved the\noperational changes contained in MOC Procedure #1529.\nAccordingly, upon consideration of all of the evidence and arguments presented during the\nhearing and in Respondent’s Closing, I find that Plantation’s Tank 113 Procedure was in effect at\nthe time of the March 25, 2004, incident and that the company violated such policy by allowing\nthe high tank alarm on Tank 113 to be exceeded, bypassing the alarm, and continuing to operate\nthe line. Accordingly, I find that Respondent violated 49 C.F.R. § 192.402(d)(1)(iv) by failing to\nfollow its own procedures providing for the operation of safety devices when the operating\ndesign limits of its facilities were exceeded.\nItem 3 of the Notice alleged that Respondent violated 49 C.F.R. § 195.404(a)(1)(iv), which\nstates:\n§ 195.404. Maps and records.\n(a) Each operator shall maintain current maps and records of its\npipeline systems that include at least the following information:\n(1) Location and identification of the following pipeline facilities: . . .\n(iv) Pipeline valves . . . .\n3 Response, at 3, 4.\n4 Closing, at 5.\n5 Violation Report, Exhibit 2.\n\n\n\n5\nItem 3 of the Notice alleged that Respondent violated § 195.404(a)(1)(iv) by failing to maintain\ncurrent maps and records of its pipeline systems. Specifically, the Notice alleged that Plantation\nfailed to depict block valves 1A and 1B for the PPL to KMST delivery line on the company’s\nalignment sheets. The Notice alleged that during the inspection, the company’s Operations and\nMaintenance Supervisor stated that he did not know why the valves were not shown on the\nalignment sheets.\nIn its Response and at the hearing, Respondent acknowledged that the valves were not depicted\non the alignment sheets. The company argued, however, that the valves were shown on its\nDelorme Maps, which were used by field personnel when responding to emergencies, and that\nsuch maps were accessible to all personnel on the company’s intranet. In addition, Plantation\ncontended that the valves were included in its semi-annual valve inspections and also in its\nannual Corrosion Survey. Therefore, the company contended that because the valves were\nshown on other maps and records and the company included them in its routine inspection\nprograms, this constituted compliance with § 195.404(a)(1)(iv).\nI disagree. Inherent in an operator’s obligation under § 195.404(a) to maintain “current maps\nand records” is the need for such records to be complete and accurate. The last revision date on\nthis particular alignment sheet was October 21, 1991, which was after the date that the valves\nwere installed. Therefore, the alignment sheets being used by Plantation personnel were not\n“current.” As OPS noted at the hearing, if company field personnel had an immediate need for\ninformation regarding the location of block valves 1A and 1B, their ability to quickly locate,\ndrive to, and shut the valves could have been compromised by the lack of accurate alignment\nsheets.\nFurthermore, Respondent failed to produce any verifiable documentation or tangible evidence\nthat the alignment sheets were actually accessible to field personnel on Respondent’s intranet or\notherwise. A primary objective of § 195.404 is to ensure that operators are able to effectively\nlocate their pipeline facilities during emergencies. If alignment sheet are inaccurate, it may be\ndifficult for personnel to follow the proper procedures and techniques to prevent hazards.\nAccordingly, upon a review of all of the evidence, I find that Respondent violated 49 C.F.R.\n§195.404(a)(1)(iv) by failing to maintain current alignment sheets of its pipeline systems that\nshowed the two block valves.\nASSESSMENT OF PENALTY\nUnder 49 U.S.C. § 60122, Respondent is subject to a civil penalty not to exceed $100,000 per\nviolation for each day of the violation, up to a maximum of $1,000,000 for any related series of\nviolations. 49 U.S.C. § 60122 and 49 C.F.R. § 190.225 require that, in determining the amount\nof the civil penalty, I consider the following criteria: the nature, circumstances, and gravity of the\nviolation, including adverse impact on the environment; the degree of Respondent’s culpability;\nthe history of Respondent’s prior offenses; the Respondent’s ability to pay the penalty and any\neffect that the penalty may have on its ability to continue doing business; and the good faith of\n\n\n\n6\nRespondent in attempting to comply with the pipeline safety regulations. In addition, I may\nconsider the economic benefit gained from the violation without any reduction because of\nsubsequent damages, and such other matters as justice may require. The Notice proposed a total\ncivil penalty of $155,000 for violations of 49 C.F.R. Part 195.\nItem 1 of the Notice proposed a civil penalty of $5,000 for violation of 49 C.F.R. § 195.402(a),\nfor Respondent’s failure to review its Plan at the Washington Station facility in 2002 and 2003,\nat intervals not exceeding 15 months but at least once each calendar year. As discussed above,\nthe record shows that despite Plantation’s contention that it conducted annual reviews of the\nPlan, the company was unable to provide any verifiable contemporaneous documentation or\nother persuasive evidence to show that it actually performed such reviews within the required\nintervals. Sound recordkeeping serves to authenticate a company’s procedures, controls, and\nreviews; they are an essential means of demonstrating compliance with regulatory requirements\nand ensuring accountability within an operator’s organization. Respondent has not provided any\nevidence that would justify mitigation or elimination of the proposed civil penalty. Accordingly,\nhaving reviewed the record and considered the assessment criteria, I assess Respondent a civil\npenalty of $5,000 for its violation of 49 C.F.R. § 195.402(a).\nItem 2 of the Notice proposed a civil penalty of $100,000 for violation of 49 C.F.R.\n§195.402(d)(1)(iv), for Respondent’s failure to follow its own Tank 113 Procedure on March 25,\n2004, when the company allowed the high tank level alarm on Tank 113 to be exceeded. As\ndiscussed above, I found that said procedure was in effect at the time of the incident and that\nRespondent failed to comply with it, as required under § 195.402(d)(1)(iv). It is critical that\nprocedures dealing with abnormal operations be kept up-to-date and adequately communicated\nto employees so that they can perform their assigned tasks without jeopardizing their own\npersonal safety or that of the pipeline. In this case, the company failed to follow its own\nprocedures for the operation of a critical safety device and even documented such failure by\nfiling a “Near Miss” report. The failure of the company to have and follow current safety\nprocedures could have resulted in potentially serious safety and environmental consequences.\nRespondent has not provided any evidence that would justify mitigation or elimination of the\nproposed civil penalty. Accordingly, having reviewed the record and considered the assessment\ncriteria, I assess Respondent a civil penalty of $100,000 for its violation of 49 C.F.R.\n§ 195.402(d)(1)(iv).\nItem 3 of the Notice proposed a civil penalty of $50,000 for violation of 49 C.F.R.\n§195.404(a)(1)(iv), for Respondent’s failure to maintain current maps and records of its pipeline\nsystem. As discussed above, Respondent acknowledged that the two block valves in question\nwere not depicted on the alignment sheet for the PPL to KMST delivery line, but argued that\nbecause the valves were shown on other maps that were available to company personnel, the\ncompany demonstrated compliance with the regulation. I rejected this argument, finding that\nRespondent violated § 195.404(a)(1)(iv) by failing to update the alignment sheets for this facility\nto show the accurate location of the two block valves.\nRespondent argued that the proposed penalties for Items 2 and 3 were excessive because: (1) the\nalleged violations had not resulted in any adverse impact on the environment; (2) all of the\n\n\n\n7\ncompany’s actions were undertaken in a good faith effort to achieve compliance and Plantation\ndid not have a history of similar violations; (3) omission of the valves on the alignment sheets\nwas merely an oversight, since the company was well aware of the valves via inspections and\nmaintenance; and (4) accurate maps were accessible to its personnel via the company’s intranet.\nI find all of these arguments unpersuasive. The fact that no safety or environmental harm\nresulted from the violations may simply have been fortuitous. It is correct that PHMSA\nrecognizes the good faith efforts of operators to achieve compliance with the regulations; for\nexample, they may misinterpret a regulatory requirement in establishing their own policies and\nprocedures. In this case, however, Plantation failed to follow its own procedures for the\noperation of the high tank level alarm and treated the incident as a “near miss.” Therefore, I\ncannot consider this to constitute a good faith effort to achieve compliance with § 195.402(d)(1).\nAs for Respondent’s contention that the omission of the valves on the alignment sheets was a\nmere oversight, that does not reduce its potential risk. PHMSA is aware of serious accidents on\nother pipelines that could have either been prevented or greatly mitigated if field personnel had\nhad accurate alignment sheets readily available to them on their job sites. Even if company\npersonnel inspected the valves regularly and knew their location, this doesn’t reduce the need for\nall personnel and contractors to have ready access to accurate maps and records in the event of\nemergencies. In such situations, field personnel may not have sufficient time to check the\ncompany’s intranet for the location of valves.\nRespondent also failed to produce any verifiable documentation or evidence showing that\naccurate alignment sheets were actually accessible to personnel in the field on Respondent’s\nintranet or otherwise. Respondent has not shown any circumstance that would justify its failure\nto maintain accurate alignment sheets that included valves 1A and 1B. Accordingly, having\nreviewed the record and considered the assessment criteria, I assess Respondent a civil penalty of\n$50,000 for its violation of 49 C.F.R. § 195.404(a)(1)(iv).\nIn summary, having reviewed the entire record and considered the assessment criteria, I assess\nRespondent a total civil penalty of $155,000. There is nothing in the record indicating that\npayment of this penalty would adversely affect Respondent’s ability to continue in business.\nPayment of the civil penalty must be made within 20 days of service. Federal regulations\n(49 C.F.R. § 89.21(b)(3)) require this payment be made by wire transfer, through the Federal\nReserve Communications System (Fedwire), to the account of the U.S. Treasury. Detailed\ninstructions are contained in the enclosure. Questions concerning wire transfers should be\ndirected to: Financial Operations Division (AMZ-341), Federal Aviation Administration, Mike\nMonroney Aeronautical Center, P.O. Box 269039, Oklahoma City, OK 73125; (405) 954-8893.\nFailure to pay the $155,000 civil penalty will result in accrual of interest at the current annual\nrate in accordance with 31 U.S.C. § 3717, 31 C.F.R. §901.9 and 49 C.F.R. § 89.23. Pursuant to\nthose same authorities, a late penalty charge of six percent (6%) per annum will be charged if\npayment is not made within 110 days of service. Furthermore, failure to pay the civil penalty\nmay result in referral of the matter to the Attorney General for appropriate action in a United\nStates District Court.\n\n\n\n8\nUnder 49 C.F.R. § 190.215, Respondent has a right to submit a Petition for Reconsideration of\nthis Final Order. The petition must be received within 20 days of Respondent's receipt of this\nFinal Order and must contain a brief statement of the issue(s). The filing of the petition\nautomatically stays the payment of any civil penalty assessed. All other terms of the order,\nincluding any required corrective action, remain in full effect unless the Associate Administrator,\nupon request, grants a stay. The terms and conditions of this Final Order shall be effective upon\nreceipt.\n_________________________________ __________________\nJeffrey D. Wiese Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":24594}