{"operation":"document","citation":"CPF 12022041NOA","title":"HILCORP ALASKA, LLC — Notice of Amendment","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2022-04-14","effective_on":null,"summary":"CLOSED notice of amendment citing 192.12(c).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-12022041noa.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-12022041noa.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-12022041noa","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/12022041NOA","body":"Notice of Amendment involving HILCORP ALASKA, LLC. PHMSA's enforcement data identifies the cited regulation as 192.12(c). The case was opened on 2022-04-14 and is reported as closed as of 2022-06-02. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n12022041NOA_Closure Letter_06022022_(21-200333).pdf: https://primis.phmsa.dot.gov/enforcement-documents/12022041NOA/12022041NOA_Closure%20Letter_06022022_(21-200333).pdf\n\n12022041NOA_Closure Letter_06022022_(21-200333)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/12022041NOA/12022041NOA_Closure%20Letter_06022022_(21-200333)_text.pdf\n\n12022041NOA_Notice of Amendment_04142022_(21-200333).pdf: https://primis.phmsa.dot.gov/enforcement-documents/12022041NOA/12022041NOA_Notice%20of%20Amendment_04142022_(21-200333).pdf\n\n12022041NOA_Notice of Amendment_04142022_(21-200333)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/12022041NOA/12022041NOA_Notice%20of%20Amendment_04142022_(21-200333)_text.pdf\n\n12022041NOA_Operator Response to Notice_05132022_(21-200333).pdf: https://primis.phmsa.dot.gov/enforcement-documents/12022041NOA/12022041NOA_Operator%20Response%20to%20Notice_05132022_(21-200333).pdf\n\n12022041NOA_Closure Letter_06022022_(21-200333)_text.pdf\n\nOVERNIGHT EXPRESS DELIVERY\nJune 2, 2022\nMr. Luke Saugier\nSenior Vice President\nHilcorp Alaska, LLC\n3800 Centerpoint Drive, Suite 1400\nAnchorage, Alaska 99503\nCPF 1-2022-041-NOA\nDear Mr. Saugier:\nFrom July 13 through July 16, 2021, and August 10 through August 11, 2021, representatives from\nthe Pipeline and Hazardous Materials Safety Administration (PHMSA), pursuant to Chapter 601\nof 49 United States Code, inspected Hilcorp Alaska, LLC’s (Hilcorp) procedures for the operation\nof Kenai, Swanson River, and Pretty Creek Gas Storage fields in Kenai Peninsula and Matanuska\nSusitna counties, Alaska. As a result of the inspection, Hilcorp was issued a Notice of Amendment\non April 14, 2022, which proposed amendment of your procedures.\nHilcorp submitted its amended procedures on May 13, 2022. My staff reviewed the amended\nprocedures, and it appears that the inadequacies outlined in this Notice of Amendment have been\ncorrected.\nThis letter is to inform you no further action is necessary and this case is now closed. Thank you\nfor your cooperation.\nSincerely,\nRobert Burrough\nDirector, Eastern Region\nPipeline and Hazardous Materials Safety Administration\n\n12022041NOA_Notice of Amendment_04142022_(21-200333)_text.pdf\n\nNOTICE OF AMENDMENT\nVIA ELECTRONIC MAIL TO: lsaugier@hilcorp.com\nApril 14, 2022\nMr. Luke Saugier\nSenior Vice President\nHilcorp Alaska, LLC\n3800 Centerpoint Drive, Suite 1400\nAnchorage, Alaska 99503\nCPF 1-2022-041-NOA\nDear Mr. Saugier:\nFrom July 13 through July 16, 2021, and August 10 through August 11, 2021, representatives of\nthe Pipeline and Hazardous Materials Safety Administration (PHMSA) pursuant to Chapter 601\nof 49 United States Code inspected Hilcorp Alaska, LLC’s (Hilcorp) procedures for the operation\nof Kenai, Swanson River, and Pretty Creek Gas Storage fields in Kenai Peninsula and Matanuska\nSusitna counties, Alaska.\nOn the basis of the inspection, PHMSA has identified the apparent inadequacies found within\nHilcorp’s plans or procedures, as described below:\n1. § 192.12 Underground natural gas storage facilities.\n(a) …\n(c) Procedural manuals. Each operator of a UNGSF must prepare\nand follow for each facility one or more manuals of written procedures\nfor conducting operations, maintenance, and emergency preparedness\nand response activities under paragraphs (a) and (b) of this section.\nEach operator must keep records necessary to administer such\nprocedures and review and update these manuals at intervals not\nexceeding 15 months, but at least once each calendar year. Each\noperator must keep the appropriate parts of these manuals accessible\nat locations where UNGSF work is being performed. Each operator\nmust have written procedures in place before commencing operations\n\n\n\nCPF 1-2022-041-NOA\nor beginning an activity not yet implemented.\nHilcorp’s written procedures for conducting operations, maintenance, and emergency\npreparedness and response activities under §192.12(b)(2) were inadequate to assure safe operation\nof a pipeline facility. Specifically, Hilcorp failed to develop a procedure to evaluate each annular\ngas occurrence that exceeds operator- or regulatory-defined threshold levels in accordance with\nAPI RP 1171, Section 9.3.2 (Section 9.3.2).\nSection 9.3.2 states in relevant part, “[t]he operator shall evaluate each annular gas occurrence that\nexceeds operator- or regulatory-defined threshold levels determined from well integrity evaluation\nand from risk assessment.”\nDuring the inspection, PHMSA reviewed Hilcorp’s Operations, Maintenance & Emergency\nResponse (OMER) manual and found that it did not include a process to evaluate each annular gas\noccurrence that exceeds operator- or regulatory-defined threshold levels.\nTherefore, Hilcorp’s written procedures were inadequate regarding evaluation of annular gas\noccurrence exceedances. Hilcorp must revise its procedures to address the deficiency outlined\nabove.\n2. § 192.12 Underground natural gas storage facilities.\n(a) …\n(c) Procedural manuals. Each operator of a UNGSF must prepare\nand follow for each facility one or more manuals of written procedures\nfor conducting operations, maintenance, and emergency preparedness\nand response activities under paragraphs (a) and (b) of this section.\nEach operator must keep records necessary to administer such\nprocedures and review and update these manuals at intervals not\nexceeding 15 months, but at least once each calendar year. Each\noperator must keep the appropriate parts of these manuals accessible\nat locations where UNGSF work is being performed. Each operator\nmust have written procedures in place before commencing operations\nor beginning an activity not yet implemented.\nHilcorp’s written procedures for conducting operations, maintenance, and emergency\npreparedness and response activities under §192.12(b)(2) were inadequate to assure safe operation\nof a pipeline facility. Specifically, Hilcorp did not have a written process in place to use a risk-\nbased approach for developing integrity demonstration, verification, and monitoring tasks and\nevaluating their frequency requirements in accordance with API RP 1171, Section 9.2.2 (Section\n9.2.2).\nSection 9.2.2 states in relevant part, “[r]isk assessments shall be used as a basis for developing the\nintegrity demonstration, verification, and monitoring tasks and evaluating their frequency\nrequirements.”\nDuring the inspection, PHMSA reviewed Hilcorp’s OMER manual and found that it did not\ninclude a written process to use a risk-based approach for developing integrity demonstration,\n12022041NOA_Notice of Amendment_04142022_(21-200333)_text Page 2 of 4\n\n\n\nCPF 1-2022-041-NOA\nverification, and monitoring tasks and evaluating their frequency requirements.\nTherefore, Hilcorp’s written procedures were inadequate regarding risk-based evaluation. Hilcorp\nmust revise its procedures to address the deficiency outlined above.\n3. § 192.12 Underground natural gas storage facilities.\n(a) …\n(c) Procedural manuals. Each operator of a UNGSF must prepare\nand follow for each facility one or more manuals of written procedures\nfor conducting operations, maintenance, and emergency preparedness\nand response activities under paragraphs (a) and (b) of this section.\nEach operator must keep records necessary to administer such\nprocedures and review and update these manuals at intervals not\nexceeding 15 months, but at least once each calendar year. Each\noperator must keep the appropriate parts of these manuals accessible\nat locations where UNGSF work is being performed. Each operator\nmust have written procedures in place before commencing operations\nor beginning an activity not yet implemented.\nHilcorp’s written procedures for conducting operations, maintenance, and emergency\npreparedness and response activities under §192.12(b)(2) were inadequate to assure safe operation\nof a pipeline facility. Specifically, Hilcorp’s Emergency Action Plan (EAP) did not address all the\nelements specified in API RP 1171, Section 10.6.1 (Section 10.6.1).\nSection 10.6.1 states in relevant part:\nFor site security and safety, the operator shall develop and implement a structured\nemergency preparedness/response plan in order to address accidental releases, equipment\nfailures, natural disasters, and third-party emergencies.\nDuring the inspection, PHMSA reviewed Hilcorp’s EAP and noted that equipment failures and\nthird-party emergencies were not included as emergency scenarios.\nTherefore, Hilcorp’s written procedures were inadequate regarding its EAP’s emergency\nscenarios. Hilcorp must revise its procedures to address the deficiency outlined above.\nResponse to this Notice\nThis Notice is provided pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.206. Enclosed as\npart of this Notice is a document entitled Response Options for Pipeline Operators in Enforcement\nProceedings.\nPlease refer to this document and note the response options. Be advised that all material you\nsubmit in response to this enforcement action is subject to being made publicly available. If you\nbelieve that any portion of your responsive material qualifies for confidential treatment under 5\nU.S.C. 552(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\n12022041NOA_Notice of Amendment_04142022_(21-200333)_text Page 3 of 4\n\n\n\nCPF 1-2022-041-NOA\nexplanation of why you believe the redacted information qualifies for confidential treatment under\n5 U.S.C. 552(b).\nFollowing the receipt of this Notice, you have 30 days to submit written comments, revised\nprocedures, or a request for a hearing under §190.211. If you do not respond within 30 days of\nreceipt of this Notice, this constitutes a waiver of your right to contest the allegations in this Notice\nand authorizes the Associate Administrator for Pipeline Safety to find facts as alleged in this Notice\nwithout further notice to you and to issue an Order Directing Amendment. If your plans or\nprocedures are found inadequate as alleged in this Notice, you may be ordered to amend your plans\nor procedures to correct the inadequacies (49 C.F.R. § 190.206). If you are not contesting this\nNotice, we propose that you submit your amended procedures to my office within 30 days of\nreceipt of this Notice. This period may be extended by written request for good cause. Once the\ninadequacies identified herein have been addressed in your amended procedures, this enforcement\naction will be closed.\nIt is requested (not mandated) that Hilcorp Alaska, LLC maintain documentation of the safety\nimprovement costs associated with fulfilling this Notice of Amendment (preparation/revision of\nplans, procedures) and submit the total to Robert Burrough, Director, Eastern Region, Pipeline and\nHazardous Materials Safety Administration, 840 Bear Tavern Road, Suite 300, West Trenton, NJ\n08628. In correspondence concerning this matter, please refer to CPF 1-2022-041-NOA and, for\neach document you submit, please provide a copy in electronic format whenever possible. Smaller\nfiles may be emailed to robert.burrough@dot.gov. Larger files should be sent on USB flash drive\naccompanied by the original paper copy to the Eastern Region Office.\nSincerely,\nRobert Burrough\nDirector, Eastern Region\nPipeline and Hazardous Materials Safety Administration\nEnclosure: Response Options for Pipeline Operators in Enforcement Proceedings\n12022041NOA_Notice of Amendment_04142022_(21-200333)_text Page 4 of 4","truncated":false,"body_characters":11762}