{"operation":"document","citation":"CPF 120135008","title":"MOBIL  PIPE  LINE COMPANY — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2013-06-20","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.49, 195.583(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-120135008.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-120135008.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-120135008","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/120135008","body":"Notice of Probable Violation involving MOBIL  PIPE  LINE COMPANY. PHMSA's enforcement data identifies the cited regulations as 195.49,  195.583(a). The case was opened on 2013-06-20 and is reported as closed as of 2016-10-21. Proposed civil penalty: $37,500. Assessed civil penalty: $37,500. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n120135008_Final Order_09302016.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120135008/120135008_Final%20Order_09302016.pdf\n\n120135008_Final Order_09302016_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120135008/120135008_Final%20Order_09302016_text.pdf\n\n120135008_NOPV_PCP_PCO_06202013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120135008/120135008_NOPV_PCP_PCO_06202013.pdf\n\n120135008_NOPV_PCP_PCO_06202013_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120135008/120135008_NOPV_PCP_PCO_06202013_text.pdf\n\n120135008_Operator_Response To Notice__07222013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120135008/120135008_Operator_Response%20To%20Notice__07222013.pdf\n\n120135008_Final Order_09302016_text.pdf\n\nSeptember 30, 2016\nMr. Gerald S. Frey\nGlobal Pipeline Manager & President\nExxonMobil Pipeline Company\n22777 Springwoods Village Pkwy\nE3.5A.521\nSpring, TX 77389-1425\nRe: CPF No. 1-2013-5008\nDear Mr. Frey:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation and assesses a civil penalty of $37,500. It further finds that ExxonMobil Pipeline Co.\nhas completed the actions specified in the Notice to comply with the pipeline safety regulations.\nWhen the civil penalty has been paid, this enforcement action will be closed. Service of the\nFinal Order is made pursuant to 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nAlan K. Mayberry\nActing Associate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Mr. Byron Coy, Director, Eastern Region, OPS\nMs. Catherine Little, Hunton & Williams LLP,\nBank of America Plaza, Suite 4100, 600 Peachtree Street, N.E., Atlanta, GA 30308\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\n____________________________________\nIn the Matter of )\nExxonMobil Pipeline Co., ) CPF No. 1-2013-5008\n)\n)\n)\nRespondent. )\n___________________________________ )\nFINAL ORDER\nOn November 14, 2011, pursuant to 49 U.S.C. § 60117, a representative of the Pipeline and\nHazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),\nconducted an on-site pipeline safety inspection of the facilities and records of ExxonMobil\nPipeline Company (EMPCo or Respondent) in Springfield, Massachusetts.1\nAs a result of the inspection, the Director, Eastern Region, OPS (Director), issued to\nRespondent, by letter dated June 20, 2013, a Notice of Probable Violation, Proposed Civil\nPenalty, and Proposed Compliance Order (Notice). In accordance with 49 C.F.R. § 190.207,\nthe Notice alleged that EMPCo had violated 49 C.F.R. § 195.583, proposed a civil penalty of\n$37,500 for the alleged violation, and proposed certain corrective action. The Notice also\nincluded one additional warning item in accordance with 49 C.F.R. § 190.205.\nRespondent responded to the Notice by letter dated July 22, 2013 (Response) and February 10,\n2014 (Pre-hearing Submission). EMPCo contested the allegations and requested a hearing. A\nhearing was subsequently held on July 9, 2014 in Trenton, New Jersey, before a Presiding\nOfficial from the Office of Chief Counsel, PHMSA. After the hearing, Respondent provided a\npost-hearing statement for the record, by letter dated August 22, 2014 (Closing). Pursuant to\n§ 190.209(b)(7), the Director submitted a written evaluation of Respondent’s response material\non September 8, 2015.\n1 EMPCo operates approximately 4,000 miles of pipeline transporting crude oil, refined petroleum\nproducts, and highly volatile liquids in Texas, Louisiana, and other states as reported by EMPCo for\ncalendar year 2015 pursuant to 49 C.F.R. § 195.49.\n\n\n\nCPF No. 1-2013-5008\nPage 2\nFINDING OF VIOLATION\nThe Notice alleged that Respondent violated 49 C.F.R. Part 195, as follows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.583(a), which states in\nrelevant part:\n§ 195.583 What must I do to monitor atmospheric corrosion control?\n(a) You must inspect each pipeline or portion of pipeline that is\nexposed to the atmosphere for evidence of atmospheric corrosion, as\nfollows:\nIf the pipeline\nis located: Then the frequency of inspection is:\nOnshore ......... At least once every 3 calendar years, but with\nintervals not exceeding 39 months.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.583(a) by failing to inspect an\nonshore pipeline that was exposed to the atmosphere for evidence of atmospheric corrosion.\nSpecifically, the Notice alleged that in 2010, EMPCo failed to inspect the underside of an\naboveground pipeline segment that was shielded from view by rocks. The evidence produced\nby OPS included Respondent’s 2010 inspection report that indicated the pipeline was “sitting on\n[an] abrasive rock shield.” OPS also produced photos from 2011 showing the proximity of\nrocks to the pipeline and documented conversations with Respondent’s employee who stated\nthat he did not remove the rocks to inspect the pipeline.\nRespondent contested the allegation and contended that on April 14, 2010, its Corrosion\nTechnician inspected all aboveground piping for atmospheric corrosion, including the\n“manifold piping that transports product over an area of crushed gravel.”2 Respondent\ncontended that several pipe supports, including rock shield material, lay beneath the pipe to\nreduce contact with the rocks. Respondent stated that the Technician was able to “visually\ninspect all sides of the Segment piping, including the underside of the pipe, because the\nSegment was sitting above (and not on) the crushed gravel” and that he documented the results\nof the inspection in his report by noting there were “Pipes sitting on abrasive rock shield.”3\nRespondent contended that no gravel had to be moved to conduct this inspection.\nAccording to EMPCo, when the OPS inspector observed that the pipe was in contact with\ncrushed gravel, thereby making the underside of the pipe inaccessible for inspection, the OPS\ninspector asked the Technician whether the rocks had been present during Respondent’s 2010\ninspection of the pipe. Contrary to OPS’s report that the Technician stated the rocks were not\nremoved and the underside was not inspected, Respondent contended that “at no time during the\nPHMSA inspection did [the Corrosion Technician] indicate that the portion of the Segment had\n2 Pre-hearing Submission at 2.\n3 Pre-hearing Submission at 2-3; Response, Att. 1.\n\n\n\nCPF No. 1-2013-5008\nPage 3\nnot been inspected for atmospheric corrosion.”4 Respondent argued the crushed gravel that was\nobserved during the OPS inspection had collected around the pipe sometime between the\nCompany’s 2010 atmospheric corrosion inspection and the 2011 OPS compliance inspection,\nlikely due to “routine operational activities at the Terminal, as well as topographical changes\ncaused by prior storms, tree loss, and the development of channels from water runoff.”5\nAnalysis\nSection 195.583(a) requires a pipeline operator to inspect each pipeline that is exposed to the\natmosphere for evidence of atmospheric corrosion. The inspection must take place at least once\nevery three calendar years, with intervals between inspections not exceeding 39 months. If\natmospheric corrosion is discovered, the pipeline must be cleaned and coated with a material\nsuitable for preventing atmospheric corrosion.6 If necessary, the pipeline must be repaired or\nreplaced.7 During an inspection for atmospheric corrosion, an operator must inspect the entire\ncircumference of the pipe, including beneath any thermal insulation or disbonded coating.8\nThe evidence in the record demonstrates that in 2011, an OPS inspector observed an exposed\npipeline segment at Respondent’s Springfield Terminal. The pipeline was above and touching\ncrushed gravel rocks. Pictures from 2011 show the presence of rocks would have prevented\nvisual inspection of the underside of the pipeline. During the 2011 inspection, the OPS\ninspector asked Respondent’s Corrosion Technician if he had removed the rocks to inspect the\npipeline during the most recent atmospheric inspection in 2010. The Technician indicated he\ndid not remove the rocks.\nThere is disagreement about whether the Technician meant that he did not have to remove the\nrocks because the rocks were not present in 2010. For several reasons I find the evidence\nproves the rocks were present in 2010 and Respondent failed to remove them to inspect the\npipe. Respondent’s 2010 Inspection Report noted that the pipe was “sitting on [an] abrasive\nrock shield.” A photograph of the pipeline segment from 2010 shows the pipe, the rock shield,\nand the gravel. The photograph indicates that the rocks were very close to and possibly even\ntouching the bottom of the pipe at the time of the 2010 atmospheric corrosion inspection. The\nproximity of the rocks would have impeded visual examination of the underside of the pipe.\nAlthough Respondent has submitted an affidavit by its Corrosion Technician stating that it was\nnot necessary to remove the rocks to visually inspect the underside of the pipe, the affidavit was\nprepared over two years after the 2010 atmospheric corrosion inspection. Respondent’s 2010\n4 Pre-hearing Submission at 3; Closing at 1.\n5 Closing at 2.\n6 §§ 195.581; 195.583(c).\n7 § 195.585.\n8 § 195.583(b).\n\n\n\nCPF No. 1-2013-5008\nPage 4\nInspection Report and photograph from the time of the inspection, however, provide stronger\nevidence that rocks were present and obstructed the bottom of the pipe from view.\nAccordingly, after considering all of the evidence, I find Respondent violated 49 C.F.R.\n§ 195.583(a) by failing to inspect the underside of the exposed pipeline for evidence of\natmospheric corrosion.\nThis finding of violation will be considered a prior offense in any subsequent enforcement\naction taken against Respondent.\nASSESSMENT OF PENALTY\nUnder 49 U.S.C. § 60122 (2010), Respondent is subject to an administrative civil penalty not to\nexceed $100,000 per violation for each day of the violation, up to a maximum of $1,000,000 for\na related series of violations.9 The Notice proposed a civil penalty of $37,500 for the violation\ncited above.\nIn determining the amount of a civil penalty under 49 U.S.C. § 60122 and 49 C.F.R. § 190.225,\nI must consider the following criteria: the nature, circumstances, and gravity of the violation,\nincluding adverse impact on the environment; the degree of Respondent’s culpability; the\nhistory of Respondent’s prior offenses; and any effect that the penalty may have on its ability to\ncontinue doing business; and the good faith of Respondent in attempting to comply with the\npipeline safety regulations. In addition, I may consider the economic benefit gained from the\nviolation without any reduction because of subsequent damages, and such other matters as\njustice may require.\nItem 1: The Notice proposed a civil penalty of $37,500 for Respondent’s violation of 49 C.F.R.\n§ 195.583(a), for failing to inspect an exposed pipeline for evidence of atmospheric corrosion.\nThe proposed penalty was based on assertions in the Notice and Violation Report relevant to the\npenalty assessment criteria in § 190.225. With regard to the nature of the violation, the\nViolation Report noted this violation concerned Respondent’s failure to perform an inspection.\nWith regard to circumstances, it noted the violation was discovered by OPS. With regard to\ngravity, the Violation Report suggested pipeline integrity or safe operation was potentially\ncompromised at a station or similar area. With regard to the degree of Respondent’s culpability\nand good faith, the Violation Report suggested no credit under these factors.\n9 The Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011, Pub. L. No. 112-90,\n§ 2(a)(1), 125 Stat. 1904 (Jan. 3, 2012), increased the maximum administrative civil penalty amounts to\n$200,000 per violation for each day of the violation, up to a maximum of $2,000,000 for a related series\nof violations. The maximum penalties were also increased to account for inflation. Pipeline Safety:\nInflation Adjustment of Maximum Civil Penalties, 81 Fed. Reg. 42564 (Jun. 30, 2016).\n\n\n\nCPF No. 1-2013-5008\nPage 5\nRespondent argued the civil penalty should be reduced based on its good faith “performance of\nthe April 2010 inspection and actions taken since.”10 Respondent stated that “Within a week\nfollowing the OPS 2011 inspection, the Company removed the crushed gravel so that the\nSegment was no longer in contact with the gravel and verified that no external corrosion was\nevident.”11 When considering the good faith of Respondent in attempting to comply, PHMSA\nlooks at “the attempt by the operator to comply with the cited regulation prior to the occurrence\nof the violation.”12 Respondent’s actions taken after the OPS inspection, though prudent to\ncome into compliance, does not warrant reducing the civil penalty. Respondent’s attempt to\ncomply by performing the 2010 inspection is noted, but due to its failure to inspect the entire\npipe no credit to the penalty is warranted.\nAt the time of the Notice, Respondent had a history of three prior offenses within the last eight\nyears. Respondent argued these offenses were not similar violations of § 195.583(a). I consider\nRespondent’s entire history of prior violations, not just repeat offenses.\nAccordingly, having reviewed the record and considered the assessment criteria, Respondent is\nassessed a civil penalty of $37,500 for the violation of § 195.583(a).\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 such payment to 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 (AMK-325), Federal Aviation Administration, 6500\nS MacArthur Blvd., Oklahoma City, Oklahoma 79169. The Financial Operations Division\ntelephone number is (405) 954-8845.\nFailure to pay the $37,500 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 district\ncourt of the United States.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Item 1 in the Notice for violation of 49\nC.F.R. § 195.583(a). Under 49 U.S.C. § 60118(a), each person who engages in the\ntransportation of hazardous liquid or who owns or operates a pipeline facility is required to\ncomply with the applicable safety standards established under chapter 601. The Director\n10 Closing at 4.\n11 Pre-hearing Submission at 3.\n12 White Cliffs Pipeline, LLC, CPF No. 3-2011-5012, at 6, 2013 WL 1247518, at *5 (Feb. 5, 2013).\n\n\n\nCPF No. 1-2013-5008\nPage 6\nindicated that Respondent has taken the following actions specified in the proposed compliance\norder:\nWith respect to the violation of § 195.583(a) (Item 1), Respondent has removed the\ngravel in question, inspected the underside of the pipeline segment, and remediated any\ndeficiencies.\nAccordingly, I find that compliance has been achieved with respect to this violation. It is not\nnecessary to include the proposed compliance terms in this Order.\nWARNING ITEM\nWith respect to Item 2, the Notice alleged a probable violation of § 195.49 but did not propose a\ncivil penalty or compliance order for this item. Therefore, this is considered to be a warning\nitem. The warning is for:\n49 C.F.R. § 195.49 (Item 2) – Respondent’s alleged failure to accurately complete\nannual reporting DOT Form PHMSA F-7000-1.1 for its hazardous liquid pipeline\nfacility. For reporting year 2010, Respondent allegedly included a 22-mile pipeline that\nhas been abandoned since 1983.\nEMPCo provided information showing it has taken action to address the cited item by removing\nthe abandoned pipeline from its 2011 annual report. If OPS finds a violation of this provision in\na subsequent inspection, Respondent may be subject to future enforcement action.\nUnder 49 C.F.R. § 190.243, Respondent may submit a petition for reconsideration of this Final\nOrder to the Associate Administrator for Pipeline Safety, PHMSA, 1200 New Jersey Avenue\nSE, East Building, 2nd Floor, Washington, D.C. 20590, no later than 20 days after receipt of the\nOrder by Respondent. Any petition submitted must contain a statement of the issue(s) and meet\nall requirements of 49 C.F.R. § 190.243. The filing of a petition automatically stays the\npayment of any civil penalty assessed. The other terms of the order, including any corrective\naction, remain in effect unless the Associate Administrator, upon request, grants a stay.\nThe terms and conditions of this Final Order are effective upon service in accordance with 49\nC.F.R. § 190.5.\n__________________________________ __________________________\nAlan K. Mayberry Date\nIssued\nActing Associate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":17710}