{"operation":"document","citation":"CPF 12023026WL","title":"ATMOS ENERGY CORPORATION - ATMOS PIPELINE AND STORAGE, LLC — Warning Letter","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2023-03-16","effective_on":null,"summary":"CLOSED warning letter citing 192.12(b)(2).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-12023026wl.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-12023026wl.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-12023026wl","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/12023026WL","body":"Warning Letter involving ATMOS ENERGY CORPORATION - ATMOS PIPELINE AND STORAGE, LLC. PHMSA's enforcement data identifies the cited regulation as 192.12(b)(2). The case was opened on 2023-03-16 and is reported as closed as of 2023-03-16. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n12023026WL_Warning Letter_03162023_(22-235030).pdf: https://primis.phmsa.dot.gov/enforcement-documents/12023026WL/12023026WL_Warning%20Letter_03162023_(22-235030).pdf\n\n12023026WL_Warning Letter_03162023_(22-235030)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/12023026WL/12023026WL_Warning%20Letter_03162023_(22-235030)_text.pdf\n\n12023026WL_Warning Letter_03162023_(22-235030)_text.pdf\n\nWARNING LETTER\nOVERNIGHT EXPRESS DELIVERY\nMarch 16, 2023\nMr. Kevin Dobbs\nPresident\nAtmos Energy Corporation\n810 Crescent Centre Drive\nFranklin, Tennessee 37067\nCPF 1-2023-026-WL\nDear Mr. Dobbs:\nFrom August 15 through August 18, 2022, representatives of the Pipeline and Hazardous Materials\nSafety Administration (PHMSA) pursuant to Chapter 601 of 49 United States Code (U.S.C.)\ninspected Atmos Energy Corporation’s (Atmos Energy) Barnsley Gas Storage and East Diamond\nGas Storage fields in Hopkins County, Kentucky.\nAs a result of the inspection, it is alleged that you have committed probable violations of the\nPipeline Safety Regulations, Title 49, Code of Federal Regulations (CFR). The items inspected\nand the probable violations are:\n1. § 192.12 Underground natural gas storage facilities.\n(a) …\n(b) Depleted hydrocarbon and aquifer reservoir UNGSFs.\n(1) …\n(2) Each UNGSF that uses a depleted hydrocarbon reservoir or an\naquifer reservoir for natural gas storage and was constructed on or\nbefore July 18, 2017, must meet the provisions of API RP 1171\n(incorporated by reference, see §192.7), sections 8, 9, 10, and 11, and\nparagraph (c) of this section, by January 18, 2018, and must meet all\nprovisions of paragraph (d) of this section by March 13, 2021.\nAtmos Energy failed to meet the provisions of API RP 1171, Section 9. Specifically, Atmos\nEnergy failed to perform annual master valve isolation tests in accordance with Section 9.3.2.\n\n\n\nSection 9.3.2 states in part:\nThe operator shall test the operation of the master valve and wellhead pipeline isolation\nvalve at least annually for proper function and ability to isolate the well.\nAtmos Energy’s procedure, Storage Well Valve Isolation Testing Procedure (Kentucky), states\nin part:\n1.0 Purpose/Scope- API RP 1171, Section 9.3.2, Well Integrity Monitoring requires the\noperator to test the operation of the master valve and wellhead pipeline isolation valve at\nleast annually for proper function and ability to isolate the well. This procedure establishes\nthe process for storage well valve isolation testing, thresholds, notification, and reporting.\nDuring the inspection, PHMSA reviewed Atmos Energy’s East Diamond storage facility wellhead\nvalve isolation testing results conducted on March 17, 2022, in accordance with their Storage Well\nValve Isolation Testing Procedure (Kentucky). These records did not specify master valve test\nresults were acceptable for wells kypsco 1, kypsco 6, kypsco 7, and ICC #1. Atmos Energy stated\nthey did not do the master valve isolation testing for these wells due to the 1\" siphon line through\nthe master valve.\nTherefore, Atmos Energy failed to meet the provisions of Section 9.3.2.\n2. § 192.12 Underground natural gas storage facilities.\n(a) …\n(b) Depleted hydrocarbon and aquifer reservoir UNGSFs.\n(1) …\n(2) Each UNGSF that uses a depleted hydrocarbon reservoir or an\naquifer reservoir for natural gas storage and was constructed on or\nbefore July 18, 2017, must meet the provisions of API RP 1171\n(incorporated by reference, see §192.7), sections 8, 9, 10, and 11, and\nparagraph (c) of this section, by January 18, 2018, and must meet all\nprovisions of paragraph (d) of this section by March 13, 2021.\nAtmos Energy failed to meet the provisions of API RP 1171, Section 11. Specifically, Atmos Energy\nfailed to train operating personnel of changes made to the operating procedures prior to operation of\nstorage wells in accordance with API RP 1171, Section 11.12.2 (Section 11.12.2).\nSection 11.12.2 states in part, “Whenever changes are made to the operating procedures specified in\n11.3, operating personnel shall be notified and trained as necessary in the changes and training\ndocumented before operating storage wells and reservoirs.”\nDuring the inspection, Atmos Energy was not able to provide records showing that operating\npersonnel were trained on the changes to the operating procedures prior to operation of the wells\nat the four storages. Atmos Energy’s new Storage Well Valve Isolation Testing Procedure\n(Kentucky) was dated September 20, 2021, and labeled as draft. Atmos Energy did not provide any\nrecords demonstrating that its operating personnel were trained on this draft procedure. Isolation\ntests on wells were conducted utilizing this procedure at Barnsley UNGS on 3/16/2022 and East\nDiamond UNGS on 3/17/2022.\n\n\n\nTherefore, Atmos Energy failed to meet the provisions of Section 11.12.2.\nUnder 49 U.S.C. § 60122 and 49 CFR § 190.223, you are subject to a civil penalty not to exceed\n$257,664 per violation per day the violation persists, up to a maximum of $2,576,627 for a related\nseries of violations. For violation occurring on or after March 21, 2022, and before January 6,\n2023, the maximum penalty may not exceed $239,142 per violation per day the violation persists,\nup to a maximum of $2,391,142 for a related series of violations. For violation occurring on or\nafter May 3, 2021, and before March 21, 2022, the maximum penalty may not exceed $225,134\nper violation per day the violation persists, up to a maximum of $2,251,334 for a related series of\nviolations. For violation occurring on or after January 11, 2021, and before May 3, 2021, the\nmaximum penalty may not exceed $222,504 per violation per day the violation persists, up to a\nmaximum of $2,225,034 for a related series of violations. For violation occurring on or after July\n31, 2019, and before January 11, 2021, the maximum penalty may not exceed $218,647 per\nviolation per day the violation persists, up to a maximum of $2,186,465 for a related series of\nviolations. For violation occurring on or after November 27, 2018, and before July 31, 2019, the\nmaximum penalty may not exceed $213,268 per violation per day, with a maximum penalty not to\nexceed $2,132,679. For violation occurring on or after November 2, 2015, and before November\n27, 2018, the maximum penalty may not exceed $209,002 per violation per day, with a maximum\npenalty not to exceed $2,090,022.\nWe have reviewed the circumstances and supporting documents involved in this case, and have\ndecided not to conduct additional enforcement action or penalty assessment proceedings at this\ntime. We advise you to correct the items) identified in this letter. Failure to do so will result in\nAtmos Energy Corporation being subject to additional enforcement action.\nNo reply to this letter is required. If you choose to reply, in your correspondence please refer to\nCPF 1-2023-026-WL. Be advised that all material you submit in response to this enforcement\naction is subject to being made publicly available. If you believe that any portion of your\nresponsive material qualifies for confidential treatment under 5 U.S.C. § 552(b), along with the\ncomplete original document you must provide a second copy of the document with the portions\nyou believe qualify for confidential treatment redacted and an explanation of why you believe the\nredacted information qualifies for confidential treatment under 5 U.S.C. § 552(b).\nSincerely,\nRobert Burrough\nDirector, Eastern Region, Office of Pipeline Safety\nPipeline and Hazardous Materials Safety Administration","truncated":false,"body_characters":7866}