{"operation":"document","citation":"CPF 120175004","title":"IMTT-BAYONNE — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2017-12-21","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.250.","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-120175004.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-120175004.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-120175004","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/120175004","body":"Notice of Probable Violation involving IMTT-BAYONNE. PHMSA's enforcement data identifies the cited regulation as 195.250. The case was opened on 2017-12-21 and is reported as closed as of 2018-06-22. Proposed civil penalty: $144,000. Assessed civil penalty: $144,000. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n120175004_Final Order_06222018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120175004/120175004_Final%20Order_06222018.pdf\n\n120175004_Final Order_06222018_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120175004/120175004_Final%20Order_06222018_text.pdf\n\n120175004_NOPV PCP PCO_12212017.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120175004/120175004_NOPV%20PCP%20PCO_12212017.pdf\n\n120175004_NOPV PCP PCO_12212017_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120175004/120175004_NOPV%20PCP%20PCO_12212017_text.pdf\n\n120175004_Operator Response To Notice_03292018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120175004/120175004_Operator%20Response%20To%20Notice_03292018.pdf\n\n120175004_NOPV PCP PCO_12212017_text.pdf\n\nNOTICE OF PROBABLE VIOLATION\nPROPOSED CIVIL PENALTY\nand\nPROPOSED COMPLIANCE ORDER\nOVERNIGHT EXPRESS DELIVERY\nDecember 21, 2017\nMr. James Hooke\nChief Executive Officer\nMacquarie Infrastructure Corporation, LLC\n125 West 55th Street\nNew York, NY 10019\nCPF 1-2017-5004\nDear Mr. Hooke:\nOn February 26, 2016 and August 16, 2016, representatives of the Pipeline and Hazardous\nMaterials Safety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code,\nresponded to and conducted an investigation into an incident involving International-Matex Tank\nTerminals1 (IMTT) 16-inch Packards to Curries pipeline within the Halecky-IMTT Park in\nBayonne, NJ.\nOn February 22, 2016, at approximately 17:30 Eastern Standard Time (EST), IMTT was notified\nof a potential release of product in the vicinity of their facilities located at Halecky-IMTT Park in\nHudson County, Bayonne, NJ.\nOver the next 24 hours, IMTT’s investigation into the notification, and subsequent excavation\nwithin the park, revealed a release of Ultra Low Sulfur Diesel from IMTT’s 16-inch Packards to\nCurries pipeline (the Pipeline). IMTT estimated 359 barrels of product were released, and\napproximately 300 barrels of the commodity were recovered.\n1 International-Matex Tank Terminals is a wholly-owned subsidiary of Macquarie Infrastructure Company, LLC.\n\n\n\nCPF 1-2017-5004\nThe National Response Center was notified of the release at 16:07 EST on February 23, 2016.\nHalecky-IMTT Park was closed to the public from February 22, 2016, until March 10, 2016. There\nwere no fires or injuries reported as a result of this accident.\nExcavation at the release site revealed that the Pipeline, which was partially replaced in September\n2015, was resting directly on a section of steel sheet piling (SSP) that was used in the construction\nprocess. IMTT submitted Form PHMSA F 7000.1 Accident Reports to PHMSA on March 22\n(Initial), August 16 (Supplemental), and September 8, 2016 (Final). The Final Accident Report\nfiled by IMTT identified the point that was resting on the SSP as the failure location, stating in\npart that “Over time and movements, the pipe failed from the stress and the puncture.” IMTT\ndetermined the apparent cause of the release was a “Material Failure of Pipe or Weld with a sub-\ncause of Construction, Installation, or Fabrication-related.”\nAs a result of the investigation, it appears that you have committed a probable violation of the\nPipeline Safety Regulations, Title 49, Code of Federal Regulations. The item inspected and\nprobable violation is:\n1. §195.250 Clearance between pipe and underground structures.\nAny pipe installed underground must have at least 12 inches (305 millimeters)\nof clearance between the outside of the pipe and the extremity of any other\nunderground structure, except that for drainage tile the minimum clearance\nmay be less than 12 inches (305 millimeters) but not less than 2 inches (51\nmillimeters). However, where 12 inches (305 millimeters) of clearance is\nimpracticable, the clearance may be reduced if adequate provisions are made\nfor corrosion control.\nIMTT failed to maintain at least 12 inches of clearance between the outside of the pipe and\nextremity of any other underground structure. Specifically, IMTT replaced a segment of the\nPipeline and failed to maintain at least 12 inches of clearance between the outside of the Pipeline\nand a section of SSP that was used during the construction process.\nDuring the investigation, the PHMSA inspector reviewed documentation for the replacement of\napproximately 1,125 feet of the 16-inch Pipeline (the “Project”).\nDuring the Project, SSP was utilized as shoring in a jack and bore pit located in Halecky-IMTT\nPark. Segments of this SSP were removed by torch cutting, creating “windows” to allow for\ninstallation of the carrier pipe and casing.\nIn an email dated 11/14/2016, the Project Superintendent for the pipeline contractor described the\nwindow cutting process as follows:\nThe \"window\" cutting process is a pipe location (field) driven event that allows for\npipe egress (launching pit) and entry (receiving pit) and is not in the realm of\nresponsibility of the sheet pile contractor, this is performed by the pipe contractor,\nThe Napp-Grecco Company in this instance. The casing pipe jack/bore would\nrequire \"windows\" to be torch cut through the sheet piling near the base of the\nexcavation (short wall), while the carrier pipe would exit the excavation at a point\n120175004_NOPV PCP PCO_12212017_text Page 2 of 5\n\n\n\nCPF 1-2017-5004\n1. 2. most sensible for a tie-in line up (job specific). In this case it was the east (long\nwall) of the excavation.\nThe \"window\" cutting event would be consistent in practice, varying only in size\nrequired to accommodate whatever size infrastructure is being installed and\nlocation of the \"window\" The standard field practice is to cut out the required\namount of sheet pile to accommodate the pipe being installed and then to continue\nthe cut along the base to include the inter-locks on the adjoining sheet piles to create\na disconnect from the sheet piles below the infrastructure and the sheet piles directly\nadjacent to them on both sides. This creates what are called \"sacrificial\" sheets,\nthose remaining in place below the installed infrastructure and allows for removal\nand recovery of the sheet piles outside of the \"window\" area. The cuts into the\nadjacent sheet piles interlock are to prevent the \"sacrificial\" sheets from\n\"hitchhiking\", being pulled upward, as the recoverable sheets are removed.\nDuring the investigation, the PHMSA inspector established that:\nExcavation of the leak site by IMTT uncovered the Pipeline sitting on top of a remaining\npiece of SSP, which had penetrated the Pipeline over time as the Pipeline shifted during\ncycles of operation. Eventually this led to the release of product during a product transfer\ninitiated on February 21, 2016 to Tank number 5605, located in the Packards Yard.\nThe torch cutting of the window on the east end of the jack and bore pit resulted in fusion\nto the adjacent, interlocking piece of SSP. This fusion led to unintended lifting of the SSP\nunder the Pipeline during the extraction of the SSP next to the windowed sheet.\nThe section of SSP under the Pipeline lifted up, contacting the bottom of the Pipeline.\nThe lifting went unnoticed during the extraction of the SSP, the project was completed,\nand the Pipeline was returned to service.\nDamage to the Pipeline due to contact with the piece of SSP led to failure of the Pipeline\non February 22, 2016.\nBased on the above facts, the Investigator found that IMTT failed to maintain at least 12 inches of\nclearance between the outside of the pipe and extremity of any other underground structure.\nProposed Civil Penalty\nUnder 49 U.S.C. § 60122 and 49 CFR § 190.223, you are subject to a civil penalty not to exceed\n$209,002 per violation per day the violation persists, up to a maximum of $2,090,022 for a related\nseries of violations. For violations occurring prior to November 2, 2015, the maximum penalty\nmay not exceed $200,000 per violation per day, with a maximum penalty not to exceed $2,000,000\nfor a related series of violations. The Compliance Officer has reviewed the circumstances and\nsupporting documentation involved in the above probable violation(s) and has recommended that\nyou be preliminarily assessed a civil penalty of $144,000 as follows:\nItem number PENALTY\n1 $144,000\n3. 4. 5. 120175004_NOPV PCP PCO_12212017_text Page 3 of 5\n\n\n\nCPF 1-2017-5004\nProposed Compliance Order\nWith respect to Item 1 pursuant to 49 United States Code § 60118, the Pipeline and Hazardous\nMaterials Safety Administration proposes to issue a Compliance Order to IMTT. Please refer to\nthe Proposed Compliance Order, which is enclosed and made a part of this Notice.\nResponse to this Notice\nEnclosed as part of this Notice is a document entitled Response Options for Pipeline Operators in\nCompliance Proceedings. Please refer to this document and note the response options. All material\nyou submit in response to this enforcement action may be made publicly available. If you believe\nthat any portion of your responsive material qualifies for confidential treatment under 5 U.S.C.\n552(b), along with the complete original document you must provide a second copy of the\ndocument with the portions you believe qualify for confidential treatment redacted and an\nexplanation of why you believe the redacted information qualifies for confidential treatment under\n5 U.S.C. 552(b). If you do not respond within 30 days of receipt of this Notice, this constitutes a\nwaiver of your right to contest the allegations in this Notice and authorizes the Associate\nAdministrator for Pipeline Safety to find facts as alleged in this Notice without further notice to\nyou and to issue a Final Order.\nPlease submit all correspondence in this matter to Robert Burrough, Director, PHMSA Eastern\nRegion, 820 Bear Tavern Road, Suite 103, West Trenton, NJ 08628. Please refer to CPF 1-2017-\n5004 on each document you submit, and whenever possible provide a signed PDF copy in\nelectronic format. Smaller files may be emailed to robert.burrough@dot.gov. Larger files should\nbe sent on a CD accompanied by the original paper copy to the Eastern Region Office.\nSincerely,\nRobert Burrough\nDirector, Eastern Region\nPipeline and Hazardous Materials Safety Administration\nEnclosures: Proposed Compliance Order\nResponse Options for Pipeline Operators in Compliance Proceedings\n120175004_NOPV PCP PCO_12212017_text Page 4 of 5\n\n\n\nCPF 1-2017-5004\nPROPOSED COMPLIANCE ORDER\nPursuant to 49 United States Code § 60118, the Pipeline and Hazardous Materials Safety\nAdministration (PHMSA) proposes to issue to IMTT a Compliance Order incorporating the\nfollowing remedial requirements to ensure the compliance of IMTT with the pipeline safety\nregulations:\n1. In regard to Item Number 1 of the Notice pertaining to IMTT’s failure to maintain at\nleast 12 inches of clearance between the outside of the pipe and extremity of any other\nunderground structure, IMTT must develop construction procedures to ensure that the\nrequirements of §195.250, Clearance between pipe and underground structures, are\nmet.\n2. All documentation demonstrating compliance with each of the items outlined in this\nCompliance Order must be submitted to Robert Burrough, Director, Eastern Region,\nPHMSA, 820 Bear Tavern Road, Suite 103, West Trenton, NJ 08628, within 60 days\nof receipt of the Final Order. Documentation and recordkeeping must be consistent\nwith appropriate regulations in 49 C.F.R. Part 195.\n3. It is requested (not mandated) that IMTT maintain documentation of the safety\nimprovement costs associated with fulfilling this Compliance Order and submit the\ntotal to Robert Burrough, Director, Eastern Region, Pipeline and Hazardous Materials\nSafety Administration. It is requested that these costs be reported in two categories:\n1) total cost associated with preparation/revision of plans, procedures, studies and\nanalyses, and 2) total cost associated with replacements, additions and other changes\nto pipeline infrastructure.\n120175004_NOPV PCP PCO_12212017_text Page 5 of 5\n\n120175004_Final Order_06222018_text.pdf\n\nJune 22, 2018\nMr. James Hooke\nChief Executive Officer\nMacquarie Infrastructure Corporation, LLC\n125 West 55th Street\nNew York, NY 10019\nRe: CPF No. 1-2017-5004\nDear Mr. Hooke:\nEnclosed please find the Final Order issued in the above-referenced case to your subsidiary,\nInternational-Matex Tank Terminals, LLC (IMTT). It makes a finding of violation and assesses\na civil penalty of $144,000. This is to acknowledge receipt of payment of the full penalty\namount, by wire transfer dated February 20, 2018. The Order further finds that IMTT has\ncompleted the actions specified in the Notice to comply with the pipeline safety regulations. This\nenforcement action is now closed. Service of the Final Order is deemed effective as provided\nunder 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nAlan K. Mayberry\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Mr. Robert Burrough, Director, Eastern Region, Office of Pipeline Safety, PHMSA\nMr. Richard Jurisich, Jr., General Counsel, International-Matex Tank Terminals, LLC,\n321 St. Charles Ave, New Orleans, LA, 70130\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__________________________________________\n)\nIn the Matter of )\n)\nInternational-Matex Tank Terminals, LLC, ) CPF No. 1-2017-5004\na subsidiary of Macquarie Infrastructure )\nCorporation, LLC, )\n)\nRespondent. )\n__________________________________________)\nFINAL ORDER\nOn February 26, 2016, and August 16, 2016, pursuant to 49 U.S.C. § 60117, representative of the\nPipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety\n(OPS), conducted an onsite investigation into an accident involving International-Matex Tank\nTerminals, LLC (IMTT or Respondent), in Bayonne, New Jersey. The accident occurred on\nIMTT’s 16-inch Packards to Curries pipeline within the IMTT-Bayonne Terminal, located in\nHudson County, New Jersey. IMTT operates 620 tanks with a total of 16 million barrels of\ncapacity of refined petroleum products at its facility in Bayonne, New Jersey.1\nAs a result of the investigation, the Director, Eastern Region, OPS (Director), issued to\nRespondent, by letter dated December 21, 2017, a Notice of Probable Violation, Proposed Civil\nPenalty, and Proposed Compliance Order (Notice). In accordance with 49 C.F.R. § 190.207, the\nNotice proposed finding that IMTT had violated 49 C.F.R. § 195.250 and proposed assessing a\ncivil penalty of $144,000 for the alleged violation. The Notice also proposed ordering\nRespondent to take certain measures to correct the alleged violation.\nAfter requesting and receiving an extension of time to respond, Respondent paid the proposed\ncivil penalty of $144,000 by wire transfer on February 20, 2018. The company did not contest\nthe allegation of violation or the proposed compliance order. In accordance with 49 C.F.R.\n§ 190.208(a)(1), such payment authorizes the Associate Administrator to make a finding of\nviolation and to issue this final order.\nFINDING OF VIOLATION\nIn its Response, IMTT did not contest the allegation in the Notice that it violated 49 C.F.R. Part\n195, as follows:\n1 See https://www.imtt.com/bayonne-new-jersey/ (last accessed May 3, 2018).\n\n\n\nCPF No. 1-2017-5004\nPage 2\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.250, which states:\n§195.250 Clearance between pipe and underground structures.\nAny pipe installed underground must have at least 12 inches (305\nmillimeters) of clearance between the outside of the pipe and the extremity\nof any other underground structure, except that for drainage tile the\nminimum clearance may be less than 12 inches (305 millimeters) but not\nless than 2 inches (51 millimeters). However, where 12 inches (305\nmillimeters) of clearance is impracticable, the clearance may be reduced if\nadequate provisions are made for corrosion control.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.250 by failing to maintain at least\n12 inches (305 millimeters) of clearance between the outside of the pipe and the extremity of any\nother underground structure. Specifically, the Notice alleged that IMTT replaced a segment of\nthe 16-inch Packards to Currie pipeline, but failed to maintain at least 12 inches of clearance\nbetween the outside of the pipeline and a section of steel sheet piling that was used during\nconstruction.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that IMTT violated 49 C.F.R. § 195.250 by failing to maintain at least 12\ninches (305 millimeters) of clearance between the outside of the pipe and the extremity of any\nother underground structure.\nThis finding of violation will be considered a prior offense in any subsequent enforcement action\ntaken against Respondent.\nASSESSMENT OF PENALTY\nUnder 49 U.S.C. § 60122, Respondent is subject to an administrative civil penalty not to exceed\n$200,000 per violation for each day of the violation, up to a maximum of $2,000,000 for any\nrelated series of violations.2 In determining the amount of a civil penalty under 49 U.S.C.\n§ 60122 and 49 C.F.R. § 190.225, I must consider the following criteria: the nature,\ncircumstances, and gravity of the violation, including adverse impact on the environment; the\ndegree of Respondent’s culpability; the history of Respondent’s prior offenses; and any effect\nthat the penalty may have on its ability to continue doing business; and the good faith of\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 $144,000 for the violation cited above.\nItem 1: The Notice proposed a civil penalty of $144,000 for Respondent’s violation of\n49 C.F.R. § 195.250, for failing to maintain at least 12 inches of clearance between the outside of\nthe pipe and the extremity of any other underground structure. IMTT neither contested the\nallegation nor presented any evidence or argument justifying reduction or elimination of the\n2 These amounts are adjusted annually for inflation. See, e.g., Pipeline Safety: Inflation Adjustment of Maximum\nCivil Penalties, 82 Fed. Reg. 19325 (April 27, 2017).\n\n\n\nCPF No. 1-2017-5004\nPage 3\nproposed penalty. Accordingly, having reviewed the record and considered the assessment\ncriteria for the Item cited above, I assess IMTT a total civil penalty of $144,000, which amount\nwas paid in full on February 20, 2018.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Item 1 for the violation of 49 C.F.R.\n§ 195.250. Under 49 U.S.C. § 60118(a), each person who engages in the transportation of\nhazardous liquids or who owns or operates a pipeline facility is required to comply with the\napplicable safety standards established under chapter 601. The Director indicates that\nRespondent has taken the following actions specified in the proposed compliance order:\n1. With respect to the violation of § 195.250 (Item 1), Respondent has developed\nconstruction procedures to ensure that the requirements of § 195.250, providing\nproper clearance between pipe and underground structures, are met.\nAccordingly, I find that compliance has been achieved with respect to this violation. Therefore,\nthe compliance terms proposed in the Notice are not included in this Order.\nThe terms and conditions of this Final Order are effective upon service in accordance with\n49 C.F.R. § 190.5.\nJune 22, 2018\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":20168}