PRODUCTS (SE) PIPE LINE CORPORATION — Warning Letter

120155009W_Warning Letter_06162015_text.pdf, page 1Official PDFU.S. Department Of Transportation Pipeline and 609.989.2171 Hazardous Materials Safety Administration 820 Bear Tavern Road, Suite 103 West Trenton, NJ 08628 WARNING LETTER OVERNIGHT EXPRESS DELIVERY June 16, 2015 Mr. Wayne Simmons, VP Operations Plantation Pipe Line Company 1001 Louisiana St, Suite 1000 Houston, TX 77002 CPF 1-2015-5009W Dear Mr. Simmons: Between August 27 and October 29, 2014, State Inspectors from the Virginia State Corporation Commission (VA SCC), acting as Agent for the Pipeline and Hazardous Materials Safety Administration (PHMSA) pursuant to Chapter 601 of 49 United States Code, inspected your Plantation Pipe Line Company (PPL) pipeline construction activities in Stafford County, Virginia. As a result of the inspection, it appears that you have committed probable violations of the Pipeline Safety Regulations, Title 49, Code of Federal Regulations. The items inspected and the probable violation(s) are: 1. §195.561 When must I inspect pipe coating used for external corrosion control? (a) You must inspect all external pipe coating required by §195.557 just prior to lowering the pipe into the ditch or submerging the pipe. PPL failed to inspect all external pipe coating required by §195.557(a) just prior to lowering/installing the pipe into the ditch. During pipe installation, PPL did not adequately inspect the pipe coating to ensure that it had sufficient adhesion/strength to resist damage due to handling and soil stress. PPL was not able to demonstrate that a coating Shore D hardness of at least 85 was obtained prior to pipe installation, per manufacturer’s procedures. VA SCC’s first inspection of the jobsite located off of Arkendale Road in Stafford County, Virginia was on August 27, 2014. At that time, the weld joints and coating were visually inspected along the 1,060 foot section of 12 inch pipe to be installed. The coating had been curing for several days prior to this inspection. VA SCC inspected the jobsite again on August 29, 2014. While VA SCC was onsite, the construction crew started to pullback a section of pipe. VA SCC noted that additional coating had been applied to the weld joint areas since their inspection on August 27, 2014. Upon further investigation, VA SCC found that the additional coating had been applied the morning of#

120155009W_Warning Letter_06162015_text.pdf, page 21-2015-5009W 2. 3. August 29, 2014, and the coating hardness was not measured by PPL as required by the manufacturer’s specifications. When VA SCC questioned the PPL O&M Supervisor, he agreed that the coating had not been tested for Shore D hardness. 1. As a result, the PPL O&M Supervisor and VA SCC inspectors inspected the coating between the fifth and sixth joint using the thumbnail test and a thumb print was left in the coating. PPL did not have a durometer on-site to measure the coating hardness. On August 29, 2014, PPL decided to remove the five joints of pipe from the bore hole, and re- blasted and recoated the joints with SP 2888. Evidence is based on VA SCC photographs of PPL girth weld, pipe entering bore hole, recoated weld joint, VA SCC Notice of Investigation (NOI) to PPL, and PPL’s response to the VA SCC NOI. Under 49 United States Code, § 60122, you are subject to a civil penalty not to exceed $200,000 per violation per day the violation persists up to a maximum of $2,000,000 for a related series of violations. For violations occurring prior to January 4, 2012, the maximum penalty may not exceed $100,000 per violation per day, with a maximum penalty not to exceed $1,000,000 for a related series of violations. We have reviewed the circumstances and supporting documents involved in this case, and have decided not to conduct additional enforcement action or penalty assessment proceedings at this time. We advise you to correct the item(s) identified in this letter. Failure to do so will result in the City being subject to additional enforcement action. No reply to this letter is required. If you choose to reply, please address your correspondence to: Byron Coy, PE, Director, PHMSA Eastern Region, 820 Bear Tavern Road, Suite 103, W. Trenton, NJ 08628 and please refer to CPF 1-2015-5009W. Be advised that all material you submit in response to this enforcement action is subject to being made publicly available. If you believe that any portion of your responsive material qualifies for confidential treatment under 5 U.S.C. 552(b), along with the complete original document you must provide a second copy of the document with the portions you believe qualify for confidential treatment redacted and an explanation of why you believe the redacted information qualifies for confidential treatment under 5 U.S.C. 552(b). Additionally, if you choose to respond to this (or any other case), please ensure that any response letter pertains solely to one CPF case number. Sincerely, Byron Coy, PE Director, Eastern Region Pipeline and Hazardous Materials Safety Administration Cc: Mr. Massoud Tahamtani, VA SCC 120155009W_Warning Letter_06162015 Page 2 of 2#