{"operation":"document","citation":"CPF 120191004","title":"ALGONQUIN GAS TRANSMISSION, L.L.C. (SPECTRA ENERGY PARTNERS, LP) — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2019-07-11","effective_on":null,"summary":"CLOSED notice of probable violation citing 192.481(a), 192.709(c).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-120191004.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-120191004.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-120191004","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/120191004","body":"Notice of Probable Violation involving ALGONQUIN GAS TRANSMISSION, L.L.C. (SPECTRA ENERGY PARTNERS, LP). PHMSA's enforcement data identifies the cited regulations as 192.481(a),  192.709(c). The case was opened on 2019-07-11 and is reported as closed as of 2020-08-31. Proposed civil penalty: $341,400. Assessed civil penalty: $337,000. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n120191004_Final Order_08032020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120191004/120191004_Final%20Order_08032020.pdf\n\n120191004_Final Order_08032020_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120191004/120191004_Final%20Order_08032020_text.pdf\n\n120191004_NOPV PCP_07112019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120191004/120191004_NOPV%20PCP_07112019.pdf\n\n120191004_NOPV PCP_07112019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120191004/120191004_NOPV%20PCP_07112019_text.pdf\n\n120191004_Operator Post-Hearing Submission_02102020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120191004/120191004_Operator%20Post-Hearing%20Submission_02102020.pdf\n\n120191004_Operator Pre-Hearing Submission_12302019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120191004/120191004_Operator%20Pre-Hearing%20Submission_12302019.pdf\n\n120191004_Operator Request for Hearing and Request Statement of Issues_10012019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120191004/120191004_Operator%20Request%20for%20Hearing%20and%20Request%20Statement%20of%20Issues_10012019.pdf\n\n120191004_Operator Response to Notice_08302019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120191004/120191004_Operator%20Response%20to%20Notice_08302019.pdf\n\n120191004_PHC Hearing Scheduled_11052019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120191004/120191004_PHC%20Hearing%20Scheduled_11052019.pdf\n\n120191004_PHC Hearing Scheduled_11052019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/120191004/120191004_PHC%20Hearing%20Scheduled_11052019_text.pdf\n\n120191004_Final Order_08032020_text.pdf\n\nAugust 3, 2020\nVIA ELECTRONIC MAIL TO: william.yardley@enbridge.com\nMr. William T. Yardley\nPresident of Gas Transmission and Midstream\nEnbridge, Inc.\n5400 Westheimer Court\nHouston, Texas 77056\nRe: CPF No. 1-2019-1004\nDear Mr. Yardley:\nEnclosed please find the Final Order issued in the above-referenced case to your subsidiary,\nAlgonquin Gas Transmission, LLC. It makes findings of violation and assesses a reduced civil\npenalty of $337,000. The penalty payment terms are set forth in the Final Order. This\nenforcement action closes automatically upon receipt of payment. Service of the Final Order by\nelectronic mail is effective upon the date of transmission as provided under 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. Rick Kivela, Manager, Operational Compliance, Enbridge, Inc.\nrick.kivela@enbridge.com\nMs. Michele Harradence, Senior Vice President and Chief Operating Officer– Gas\nTransmission and Midstream, Enbridge, Inc., Michele.harradence@enbridge.com\nMs. Annie Cook, Esq., Troutman Sanders LLP, annie.cook@troutman.com\nCONFIRMATION OF RECEIPT REQUSTED\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 )\nAlgonquin Gas Transmission, LLC, ) CPF No. 1-2019-1004\na subsidiary of Enbridge, Inc., )\n)\n)\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nFrom May 24 through June 28, 2018, pursuant to 49 U.S.C. § 60117, representatives of the\nPipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety\n(OPS), conducted an on-site pipeline safety inspection of the facilities and records of the\nAlgonquin Gas Transmission, LLC (AGT or Respondent) pipeline system in Massachusetts,\nRhode Island, and New Jersey. The AGT pipeline system consists of approximately 1,125 miles\nof pipe spanning five states and portions of the Atlantic Outer-Continental Shelf.1 AGT is a\nsubsidiary of Enbridge, Inc.2\nAs a result of the inspection, the Director, Eastern Region, OPS (Director), issued to Respondent,\nby letter dated July 11, 2019, 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 two violations of 49 C.F.R. Part 192 and proposed assessing a civil penalty of\n$341,400 for the alleged violations.\nEnbridge, Inc., the parent company, responded to the Notice on behalf of AGT by letter dated\nAugust 30, 2019 (Response). Respondent contested one of the allegations and requested a\nhearing. A hearing was subsequently held via telephone conference on January 9, 2020, before a\nPHMSA Presiding Official. At the hearing, Respondent was represented by counsel.\nRespondent provided additional materials prior to the hearing on December 30, 2019, and\nJanuary 8, 2020 (Pre-hearing submission) and following the hearing on February 10, 2020 (Post-\nhearing submission). The Director submitted a post-hearing recommendation on March 11, 2020\n(Recommendation).\n1 Pipeline Safety Violation Report (Violation Report), (July 12, 2019) (on file with PHMSA), at 1.\n2 Enbridge, Inc. website, National Gas Transmission and Midstream, available at\nhttps://www.enbridge.com/About-Us/Natural-Gas-Transmission-and-Midstream.aspx (last accessed July 9, 2020).\n\n\n\nCPF No. 1-2019-1004\nPage 2\nFINDINGS OF VIOLATION\nThe Notice alleged that Respondent violated 49 C.F.R. Part 192, as follows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 192.481(a), which states:\n§ 192.481 Atmospheric corrosion control: Monitoring.\n(a) Each operator must inspect each pipeline or portion of pipeline that\nis exposed to the atmosphere for evidence of atmospheric corrosion, as\nfollows:\nIf the pipeline is located: Then the frequency of inspection is:\nOnshore At least once every 3 calendar years, but\nwith intervals not exceeding 39 months\nOffshore At least once each calendar year, but with\nintervals not exceeding 15 months\nThe Notice alleged that AGT violated 49 C.F.R. § 192.481(a) by failing to inspect each pipeline\nor portion of pipeline that is exposed to the atmosphere for evidence of atmospheric corrosion at\na frequency of at least once every three calendar years, but with intervals not exceeding 39\nmonths. Specifically, the Notice alleged that AGT failed to meet the required time interval at 17\nlocations exposed to the atmosphere within the Massachusetts Bay/Hubline; 63 locations within\nthe Boston/Westwood area; and one location within the New Jersey area.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that AGT violated 49 C.F.R. § 192.481(a) by failing to inspect the\nspecified pipelines or portions thereof that are exposed to the atmosphere for evidence of\natmospheric corrosion at a frequency of at least once every three calendar years, but with\nintervals not exceeding 39 months.\nItem 2: The Notice alleged that AGT violated 49 C.F.R. § 192.709(c), which states:\n§ 192.709 Transmission lines: Record keeping.\nEach operator shall maintain the following records for transmission\nlines for the periods specified:\n(a)…\n(c) A record of each patrol, survey, inspection, and test required by\nsubparts L and M of this part must be retained for at least 5 years or until\nthe next patrol, survey, inspection, or test is completed, whichever is longer.\nThe Notice alleged that AGT violated 49 C.F.R. § 192.709(c) by failing to maintain records of a\ntest required by subpart M of 49 C.F.R. Part 192 for at least five years. Specifically, the Notice\nalleged that AGT failed to maintain records demonstrating that 292 emergency valves in the\n\n\n\nCPF No. 1-2019-1004\nPage 3\nSouth Plainfield, New Jersey operating area were partially operated in accordance with\n§ 192.745(a) during 2016.\nIn its Response and at the hearing, Respondent argued that it complied with the applicable\nregulations and requested that the allegation and the associated proposed civil penalty be\nwithdrawn. Respondent explained that it provided a spreadsheet-style audit report to the OPS\ninspectors to show that all 292 valves had been inspected and that it was providing additional\nrecords and documentation that it believed were sufficient to demonstrate that these valves had\nbeen partially operated as required.3\nOPS stated that the audit report Respondent provided to the OPS inspectors contained a Yes/No\ncolumn for whether partial operation of a valve occurred, and that there was an absence of any\nindication in the affirmative in this column for 292 valves as described in the Notice.\nAt the hearing, Respondent acknowledged that there was an absence of any indication in the\naffirmative in the relevant spreadsheet column for 292 valves as described in the Notice.4\nRespondent explained that it had additional pertinent records in the form of individual work\norders and provided these work orders at the time of the hearing.5 Respondent argued that these\nwork orders were actually the “documents of record” and that the spreadsheet was redundant.6\nRespondent argued that the individual work orders outlined relevant tasks that are expressly\nassociated with valve operation including: Task 0900 or 0600 (depending on the work order),\nVerify Valve Operation; Task 0100, Note any Operation Difficulty; and Task 0110, Return to\nService. Respondent noted that Task 0900 requires notation in a separate work log tab and\nfollow-up if a valve cannot be operated, and Task 0100 requires notation of any difficulty\nopening and closing the valve. In addition, Task 0140 includes a “Yes/No” entry to indicate\nwhether follow up is required and the date.7 Respondent argued correctly that the regulations do\nnot dictate any particular form in which the record must be kept and cited prior PHMSA\nenforcement cases in which PHMSA withdrew allegations of insufficient records when\nadditional records were presented.8 Having considered these arguments, I agree with\nRespondent that in this case, the individual work orders for the valve maintenance are relevant\nand I will consider them in determining whether or not compliance was achieved.\nAt the time of the inspection, only a sampling of the work orders was provided to the OPS\ninspectors. Therefore, the entire set of 292 work orders was not reviewed until the hearing took\nplace. While Respondent’s explanation at the hearing concerning the relevance of the individual\n3 Post-hearing submission, at 3.\n4 Id.\n5 See 920-page supplemental pre-hearing submission dated January 8, 2020.\n6 Post-hearing submission, at 2.\n7 Post-hearing submission, at 6.\n8 Post-hearing submission, at 5.\n\n\n\nCPF No. 1-2019-1004\nPage 4\nwork orders was persuasive, a review of all of these work orders revealed that the work orders\nfor only 168 of the 292 valves had a “Yes” value indicated for Task 0900 or 0600 to “Verify\nValve Operation”. The work orders for the remaining 124 valves did not have a “Yes” value for\nthese tasks. Therefore, Respondent’s work order records did not demonstrate that those 124\nvalves had been partially operated as required. Respondent cited its written procedures and the\nstatements of one of its employees concerning how these procedures were typically carried out to\nargue that it had partially operated these 124 valves, but this information does not negate the\nallegation that records of such partial operation were not maintained.\nAccordingly, after considering all of the evidence and the legal issues presented, I find\nthat AGT violated 49 C.F.R. § 192.709(c) by failing to maintain records demonstrating that 124\nemergency valves in the South Plainfield, New Jersey operating area were partially operated in\naccordance with § 192.745(a) during the specified time-period.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken 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.9 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; any effect that\nthe penalty may have on its ability to continue doing business; and the good faith of Respondent\nin attempting to comply with the pipeline safety regulations. In addition, I may consider the\neconomic benefit gained from the violation without any reduction because of subsequent\ndamages, and such other matters as justice may require. The Notice proposed a total civil\npenalty of $341,400 for the violations cited above.\nItem 1: The Notice proposed a civil penalty of $293,700 for Respondent’s violation of\n49 C.F.R. § 192.481(a) by failing to inspect the specified pipelines or portions thereof that are\nexposed to the atmosphere for evidence of atmospheric corrosion at a frequency of at least once\nevery three calendar years, but with intervals not exceeding 39 months. Respondent did not\nprovide any information that would warrant a reduction in the civil penalty amount proposed in\nthe Notice for this violation nor did it contest this amount. Having reviewed the record and the\npenalty factors including the nature, circumstances, gravity, and Respondent’s culpability, I find\nthat the record supports the proposed penalty. Accordingly, I assess Respondent a civil penalty\nof $293,700 for violation of 49 C.F.R. § 192.481(a).\n9 These amounts are adjusted annually for inflation. See 49 C.F.R. § 190.223.\n\n\n\nCPF No. 1-2019-1004\nPage 5\nItem 2: The Notice proposed a civil penalty of $47,700 for Respondent’s violation of 49 C.F.R.\n§ 192.709(c) by failing to maintain records demonstrating that 292 emergency valves in the\nSouth Plainfield, New Jersey operating area were partially operated in accordance with\n§ 192.745(a) during the specified time period. With regard to the nature and circumstances of\nthis violation, maintaining documentation that key maintenance tasks have been completed is a\nkey part of pipeline safety. Operators must conduct oversight of the functions carried out by\ntheir personnel and auditing records is an important means of doing so. With respect to\nculpability, there were no circumstances preventing Respondent from achieving compliance.\nRespondent was not undertaking any good-faith attempt to comply (such as enhancing its record\nkeeping) prior to discovery of the insufficient records. With respect to the gravity of the offense,\nRespondent provided information showing that there were 124 instances of violation, not 292.\nWhile the penalty amount proposed in the Notice was largely a baseline penalty amount and was\nnot a multiple of 292, it did have a minor variable component based on the number of valves. I\nfind that a minor reduction reflecting the reduction in the number of instances to 124 is\nwarranted. Based upon the foregoing, I assess Respondent a reduced civil penalty of $43,300 for\nviolation of 49 C.F.R. § 192.703(c).\nAccordingly, having reviewed the record and considered the assessment of criteria for each of\nthe Items cited above, I assess Respondent a total civil penalty of $337,000.\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, Mike\nMonroney Aeronautical Center, 6500 S MacArthur Blvd, Oklahoma City, Oklahoma 79169.\nThe Financial Operations Division telephone number is (405) 954-8845.\nFailure to pay the $337,000 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 district\ncourt of the United States.\nUnder 49 C.F.R. § 190.243, Respondent may submit a Petition for Reconsideration of this Final\nOrder to the Associate Administrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey\nAvenue, SE, East Building, 2nd Floor, Washington, DC 20590, with a copy sent to the Office of\nChief Counsel, PHMSA, at the same address, no later than 20 days after receipt of service of the\nFinal Order by Respondent. Any petition submitted must contain a brief statement of the issue(s)\nand meet all other requirements of 49 C.F.R. § 190.243. The filing of a petition automatically\nstays the payment of any civil penalty assessed. The other terms of the order, including any\ncorrective action, remain in effect unless the Associate Administrator, upon request, grants a\nstay. If Respondent submits payment of the civil penalty, the Final Order becomes the final\nadministrative decision and the right to petition for reconsideration is waived.\n\n\n\nCPF No. 1-2019-1004\nPage 6\nThe terms and conditions of this Final Order are effective upon service in accordance with 49\nC.F.R. § 190.5.\nAugust 3, 2020\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety\n\n120191004_PHC Hearing Scheduled_11052019_text.pdf\n\nNovember 5, 2019\nVIA CERTIFIED MAIL AND EMAIL TO: rick.kivela@enbridge.com and\nrobert.burrough@dot.gov\nMr. Rick Kivela\nManager, Operational Compliance\nEnbridge, Inc.\n5400 Westheimer Court\nHouston, Texas 77056\nMr. Robert Burrough\nDirector, Eastern Region\nPipeline and Hazardous Materials Safety Administration\n840 Bear Tavern Road, Suite 300\nWest Trenton, New Jersey 08628\nRe: Notice of Hearing, Algonquin Gas Transmission, LLC\nCPF No. 1-2019-1004\nDear Mr. Kivela and Mr. Burrough:\nIn accordance with 49 C.F.R. § 190.211, an informal hearing will be held regarding the Notice of\nProbable Violation and Proposed Civil Penalty issued by the Office of Pipeline Safety in the above-\nreferenced case. The hearing will take place on January 9, 2020, beginning at 1:00 pm. Eastern\nTime.\nThe hearing will be held via teleconference. I will provide the teleconference information prior to\nthe hearing. At least 10 calendar days prior to the hearing (or by December 30, 2019), both parties\nmust submit and exchange any additional written materials they intend to present at the hearing and a\nlist of attendees. This information should be provided electronically. Materials not submitted by this\ndate may be excluded.\nIf you have any questions, please do not hesitate to contact me.\nSincerely,\nLarry White\nPresiding Official\ncc: Mr. William T. Yardley, President of Gas Transmission and Midstream, Enbridge, Inc.,\n5400 Westheimer Court, Houston, Texas 77056\nMs. Ajoke Agboola, Counsel, Eastern Region, Office of Pipeline Safety, PHMSA","truncated":false,"body_characters":19655}