{"operation":"document","citation":"CPF 12023056WL","title":"NORTHERN INDIANA PUBLIC SERVICE CO — Warning Letter","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2023-09-26","effective_on":null,"summary":"CLOSED warning letter citing 192.12(b)(1).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-12023056wl.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-12023056wl.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-12023056wl","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/12023056WL","body":"Warning Letter involving NORTHERN INDIANA PUBLIC SERVICE CO. PHMSA's enforcement data identifies the cited regulation as 192.12(b)(1). The case was opened on 2023-09-26 and is reported as closed as of 2023-09-26. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n12023056WL_Warning Letter_09262023_(22-251751).pdf: https://primis.phmsa.dot.gov/enforcement-documents/12023056WL/12023056WL_Warning%20Letter_09262023_(22-251751).pdf\n\n12023056WL_Warning Letter_09262023_(22-251751)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/12023056WL/12023056WL_Warning%20Letter_09262023_(22-251751)_text.pdf\n\n12023056WL_Warning Letter_09262023_(22-251751)_text.pdf\n\nWARNING LETTER\nOVERNIGHT EXPRESS DELIVERY\nSeptember 26, 2023\nMr. Orville Cocking\nSenior Vice President Gas Operations\nNorthern Indiana Public Service Co\n801 E 86th Ave\nMerrillville, Indiana 46410\nCPF 1-2023-056-WL\nDear Mr. Cocking:\nFrom November 15-17, 2022, in an on-site inspection, the Indiana Department of Natural\nResources (IDNR) acting as a representative of the Pipeline and Hazardous Materials Safety\nAdministration (PHMSA), pursuant to Chapter 601 of 49 United States Code (U.S.C.), inspected\nNorthern Indiana Public Service Co’s (NIPSCO) Grass Creek and Royal Center storage facilities\nin Cass and Fulton Counties, Indiana.\nAs a result of the inspection, it is alleged that you have a committed probable violation of the\nPipeline Safety Regulations, Title 49, Code of Federal Regulations (CFR). The item inspected and\nthe probable violation is:\n1. §192.12 Underground natural gas storage facilities.\n(a) . . .\n(b) Depleted hydrocarbon and aquifer reservoir UNGSFs.\n(1) Each UNGSF that uses a depleted hydrocarbon reservoir or an\naquifer reservoir for natural gas storage and was constructed after July\n18, 2017, must meet all provisions of API RP 1171 (incorporated by\nreference, see § 192.7), and paragraphs (c) and (d) of this section, prior\nto commencing operations.\nNIPSCO failed to meet the provisions of API RP 1171, Section 9.3.2 (Section 9.3.2). Specifically,\nNorthern failed to demonstrate that well integrity and monitoring practices were in place for\nmultiple wells in Grass Creek and Royal Center UNGSF.\n\n\n\nSection 9.3.2, Well Integrity Monitoring, states “The operator shall monitor for presence of annular\ngas by measuring and recording annular pressure and/or annular gas flow. The operator shall\nevaluate each annular gas occurrence that exceeds operator- or regulatory-defined threshold levels\ndetermined from well integrity evaluation and from risk assessment. The operator should test\nwellhead seals when annulus pressure is detected and where injectable packing and/or test ports\nare present.\nThe operator shall visually inspect each wellhead assembly at least annually for leaks. The operator\nshall test the operation of the master valve and wellhead pipeline isolation valve at least annually\nfor proper function and ability to isolate the well. The valves shall be maintained, repaired, or\nreplaced in accordance with the operator’s valve maintenance program for isolation valves.\nSurface and subsurface safety valve systems, where installed, shall be function-tested at least\nannually. The tests shall be conducted in accordance with manufacturer’s recommendations and\nthe operator’s procedures.”\nDuring the inspection, PHMSA and the State of Indiana requested the records for the years 2018\nthrough 2022 for the well integrity monitoring activities required by Section 9.3.2. NIPSCO could\nonly provide records for 2022. NIPSCO acknowledged that it was not able to produce records for\nGrass Creek and Royal Center UNGSF that demonstrated the operation of the master valve and\nwellhead pipeline isolation valve for proper function for the years 2018-2021. Additionally,\nNIPSCO acknowledged that it was not able to produce records that demonstrate the surface and\nsubsurface safety systems were function-tested for the years 2018-2021. Furthermore, NIPSCO\ncould not produce records that the demonstrated that they inspected wells for annular gas in the\nyears 2018-2021. NIPSCO recognized the gap in 2021 and took action to revise their processes\nand procedures to ensure inspection documentation is completed, with associated inspection\ncompletion records available starting in 2022.\nTherefore, NIPSCO failed to perform well integrity and monitoring activities during 2018-2021 in\naccordance with § 192.12(b)(1) and API RP1171, Section 9.3.2.\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\n\n\n\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 item identified in this letter. Failure to do so will result in\nNorthern Indiana Public Service Co 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 1-2023-056-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":7213}