COLUMBIA GAS TRANSMISSION, LLC — Safety Order

party submissionOfficial PDF220101010S_operator response to NOPSO_10292010.pdf#

220101010S_Notice of Proposed Safety Order_09302010_text.pdf, page 1Official PDFCERTIFIED MAIL - RETURN RECEIPT REQUESTED September 30, 2010 Victor Gaglio Sr. Vice President of Operations and Engineering Columbia Gas Transmission LLC 1700 MacCorkle Av., SE Charleston, WV 25314 CPF 2-2010-1010S Dear Mr. Gaglio: Enclosed is a Notice of Proposed Safety Order (Notice) issued in the above-referenced case. The Notice proposes that you take certain measures with respect to your Columbia Gas Transmission LLC (CGT) Line P pipeline in Kentucky and West Virginia to ensure pipeline safety. Your options for responding are set forth in the Notice. Your receipt of the Notice constitutes service of that document under 49 C.F.R. §190.5. We look forward to a successful resolution to ensure pipeline safety. Please direct any questions on this matter to me at (404) 832-1160. Sincerely, Wayne T. Lemoi Director, Southern Region Office of Pipeline Safety Pipeline and Hazardous Materials Safety Administration Enclosures: Notice of Proposed Safety Order and Copy of 49 CFR §190.239#

220101010S_Notice of Proposed Safety Order_09302010_text.pdf, page 2DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY Southern Region Atlanta, GA 30303 ____________________________________ In the Matter of ) ) ) Columbia Gas Transmission LLC ) Respondent ) ____________________________________) ) CPF 2-2010-1010S NOTICE OF PROPOSED SAFETY ORDER Background and Purpose Pursuant to Chapter 601 of title 49, United States Code, the Pipeline and Hazardous Materials Safety Administration (PHMSA) has initiated an investigation of the safety of the Columbia Gas Transmission LLC (CGT) Line P in Kentucky and West Virginia. CGT is a subsidiary of NiSource Gas Transmission & Storage (NGT&S). As a result of the investigation it appears that conditions exist on CGT's pipeline facilities that pose a pipeline integrity risk to public safety, property or the environment. Pursuant to 49 U.S.C. §60117(l), PHMSA issues this Notice of Proposed Safety Order (Notice), notifying you of the preliminary findings of the investigation, and proposing that you take measures to ensure that the public, property, and the environment are protected from the potential risk. The pipeline facilities that pose a pipeline integrity risk are located in the downstream segment of CGT's approximately 66.5-mile Line P, which originates at the Beaver Creek Junction in Floyd County, Kentucky and terminates at the Kenova Compressor Station in Wayne County, West Virginia. Natural gas flows through Line P from south to north, which operates as two distinct operating segments with the upstream segment running from Beaver Creek Junction to Chestnut Junction, and the downstream segment running from Chestnut Junction to the Kenova Compressor Station. The downstream segment is approximately 38 miles long and originates at Chestnut Junction where CGT's Line PM 117 delivers additional gas into Line P. There is one compressor station, Walbridge, located approximately 15 miles downstream of Chestnut Junction and 23 miles upstream of Kenova; however, the Walbridge Station does not operate as a booster unit along Line P. Walbridge contains a single 800 hp unit that serves to compress local production gas from CGT's Line BM-19 into Line P.#

220101010S_Notice of Proposed Safety Order_09302010_text.pdf, page 32 CGT's records indicate the downstream pipeline segment of Line P consists of approximately 2 miles of 16-inch, 32.5 miles of 20-inch, and 3.5 miles of 24-inch pipe. Approximately 10 miles of the 20-inch (several sections) is composed of seamless, bare, coupled pipe with no cathodic protection. This pipe was originally installed in 1928 and is located within an area that extends approximately 12 miles downstream from Chestnut Junction. The remaining 28 miles of the downstream segment is coated, welded pipe installed at various times between 1958 and 1999. The maximum allowable operating pressure (MAOP) of the downstream segment was originally established as 360 psig but was subsequently lowered to 288 psig based on a Class Location 2 area located downstream of Chestnut Junction. According to CGT, approximately 10 miles of the pipe in the downstream segment has a hoop strength that corresponds to 600 psig at 100% of the specified minimum yield strength (SMYS) 1 with the remaining 28 miles having a hoop strength that corresponds to 950 psig or greater at 100% SMYS. Preliminary Findings On September 9, 2010, a rupture occurred in the downstream segment of CGT's Line P pipeline about half way between Chestnut Junction and the Kenova Compressor Station, approximately 850 feet south of State Route 645 in Lawrence County, Kentucky. The rupture occurred in a Class Location 1 area. There was no ignition of the escaping natural gas. The rupture occurred in an approximately 3-mile continuous pipe section of the bare, coupled, 20-inch OD x 0.250-inch WT seamless pipe with unknown grade that was installed in 1928. The nearest sections of cathodically protected coated pipe are located approximately 150 feet downstream of the rupture site and approximately 3 miles upstream of the rupture site. The coated section located approximately 150 feet downstream of the rupture site was installed in 1979 and is approximately 170 feet long. The coated section located 3 miles upstream of the rupture site was installed in 1969 and is approximately 1 mile long. An assessment of the site by the operator indicated that the failure occurred in a section of uncoated pipe that was constructed in the late 1920’s with Dresser couplings as the joining method between 20 foot nominal lengths of pipe. An approximately 20-foot long joint of pipe was expelled from the ground and landed approximately 90 feet from the site of the rupture. The expelled piece was a full 20-foot joint of pipe, which had separated from the nearest upstream and downstream couplings. The origin of the failure appeared to be within the expelled joint, located approximately 7-8 feet from one end of the joint. A preliminary evaluation of the failure origin by CGT indicated an area of reduced wall thickness on the external surface, likely caused by external corrosion. Wall thickness measurements of 119- 120 mils were recorded using an ultrasonic thickness (UT) gauge at the likely site of the rupture origin, as compared to a measurement of 301 mils near the end of the joint. 1 When pipe of unknown grade is used in a pipeline and it has not been tensile tested, the federal pipeline safety regulations specify that 24,000 psi is to be used as the assumed minimum yield strength for design purposes (see §192.107(b)(2)). By using 24,000 psi in the design formula for steel pipe, the operator has calculated that 600 psig is the internal operating pressure that corresponds to 100% SMYS for this pipe.#

220101010S_Notice of Proposed Safety Order_09302010_text.pdf, page 43 The approximately 10 miles of bare, coupled, cathodically unprotected seamless pipe remaining in the downstream segment of Line P is a pipeline integrity risk to public safety, property or the environment as follows: • Wall Loss - Based on an examination of the ruptured pipe and CGT's records, areas of excessive wall loss caused by external corrosion along the cathodically unprotected sections of the 10 miles of bare pipe are likely. External corrosion can be exacerbated by the existence of a corrosive environment. CGT identified a corrosive environment as a possible contributing factor to the incident in its preliminary analysis after the failure. • Dresser couplings - These couplings can only withstand a small amount of "pulling" force across the coupling before a pipe joint will separate from the coupling. The couplings can also fail due to axial thrust forces at closely spaced angle changes or pipe bends. These problems can be exacerbated by certain environmental conditions such as shallow cover, high water table, rutted right-of-way, saturated soft soil, erosion, soil movement, and recent excavation. Moreover, the couplings electrically isolate each pipe joint preventing the use of an impressed current cathodic protection system on the pipeline segment without bonding across each coupling. • Age and Condition - This pipe was installed circa 1928. There is virtually no possibility that the condition of this cathodically unprotected pipe will get better over time. Conversely, the condition of this pipe will likely continue to deteriorate over time and lead to more safety concerns as time goes by. • Assessment - Under existing regulations, the failure in the downstream segment of Line P on September 9, 2010, requires CGT to assess and mitigate integrity issues on this pipeline segment. There are, however, technical issues that will make assessment of this bare, coupled, cathodically unprotected, pipe challenging. There are four accepted methods2 to assess pipelines: − In-Line Inspection (ILI): The use of ILI to assess this segment is not considered viable due to the relatively low operating pressure of the pipeline. In essence there is not enough differential pressure to drive an ILI tool − Pressure tests: Notwithstanding certain exceptions, hydrostatic pressure testing using water as the test medium is the preferred pressure test assessment method for gas transmission pipelines. That said the use of hydrostatic pressure tests on this segment may not be a viable assessment method because of the Dresser couplings. − Direct Assessment: This method includes External Corrosion Direct Assessment (ECDA), Internal Corrosion Direct Assessment (ICDA), and Stress Corrosion Cracking Direct Assessment (SCCDA). Because this is bare, cathodically unprotected, coupled pipe there are very few direct assessment methods available to complete these assessments. 2 PHMSA acknowledges that these assessment methods are generally used to evaluate the integrity of pipelines in High Consequence Areas (HCAs) regulated under the Gas Transmission Pipeline Integrity Management rules in 49 CFR Part 192, Subpart O. However, these assessment methods can and should be used by operators to evaluate the integrity of other pipeline segments that pose an integrity risk to public safety, property or the environment.#

220101010S_Notice of Proposed Safety Order_09302010_text.pdf, page 54 − Other technology: The use of other technologies on bare, unprotected, coupled pipe is not a likely option for assessment in that most new assessment technologies are developed to assess welded, coated pipe that is cathodically protected. Proposed Issuance of Safety Order Section 60117(l) of Title 49, United States Code, provides for the issuance of a safety order, after reasonable notice and the opportunity for a hearing, requiring corrective measures, which may include physical inspection, testing, repair, or other action, as appropriate. The basis for making the determination that a pipeline facility has a condition or conditions that pose a pipeline integrity risk to public safety, property, or the environment is set forth both in the above-referenced statute and 49 CFR §190.239, a copy of which is enclosed. After evaluating the foregoing preliminary findings of fact and considering the age of the pipe involved, the manufacturer, the hazardous nature of the product transported and the pressure required for transporting such product, the characteristics of the geographical areas where the pipeline facility is located, and the likelihood that the conditions could worsen or develop on other areas of the pipeline and potentially impact its serviceability, it appears that the continued operation of the affected pipeline without corrective measures would pose a pipeline integrity risk to public safety, property, or the environment. Accordingly, PHMSA issues this Notice of Proposed Safety Order to notify Respondent of the proposed issuance of a safety order and to propose that Respondent take the measures specified herein to address the potential risk. Response to this Notice In accordance with §190.239, you have 30 days following receipt of this Notice to submit a written response to the official who issued the Notice. If you do not respond within 30 days, this constitutes a waiver of your right to contest this Notice and authorizes the Associate Administrator for Pipeline Safety to find facts as alleged in this Notice without further notice to you and to issue a Safety Order. In your response, you may notify that official that you intend to comply with the terms of the Notice as proposed, or you may request that an informal consultation be scheduled (you will also have the opportunity to request an administrative hearing before a safety order is issued). Informal consultation provides you with the opportunity to explain the circumstances associated with the risk condition(s) alleged in the notice and, as appropriate, to present a proposal for a work plan or other remedial measures, without prejudice to your position in any subsequent hearing. If you and PHMSA agree within 30 days of informal consultation on a plan and schedule for you to address each identified risk condition, we may enter into a written consent agreement (PHMSA would then issue an administrative consent order incorporating the terms of the agreement). If a consent agreement is not reached, or if you have elected not to request informal consultation, you may request an administrative hearing in writing within 30 days following receipt of this Notice or within 10 days following the conclusion of an informal consultation that did not result in a consent agreement, as applicable. Following a hearing, if the Associate Administrator finds the facility to have a condition that poses a pipeline integrity risk to the public, property, or the environment in accordance with §190.239, the Associate Administrator may issue a safety order.#

220101010S_Notice of Proposed Safety Order_09302010_text.pdf, page 65 Be advised that all material you submit in response to this enforcement action is subject to being made publicly available. If you believe that any portion of your responsive material qualifies for confidential treatment under 5 U.S.C. 552(b), along with the complete original document you must provide a second copy of the document with the portions you believe qualify for confidential treatment redacted and an explanation of why you believe the redacted information qualifies for confidential treatment under 5 U.S.C. 552(b). In your correspondence on this matter, please refer to CPF 2-2010-1010S for each document you submit, please provide a copy in electronic format whenever possible. Proposed Corrective Measures Pursuant to 49 U.S.C. §60117(l) and 49 C.F.R. §190.239, PHMSA proposes to issue to Columbia Gas Transmission LLC (CGT) a safety order incorporating the following remedial requirements with respect to its Line P in Kentucky and West Virginia: 1. PHMSA has previously approved a return to service plan. If and when the downstream segment of Line P is returned to service, CGT is to maintain a pressure reduction of at least 20% of the operating pressure in place at the time of rupture on September 9, 2010, until and unless an increase in pressure is approved by PHMSA. 2. CGT is to perform a root cause analysis to: a. Determine the cause of the failure, including a study and analysis of environmental, material, operational, personal performance and other factors that may have contributed to the failure; b. Review the control center response to the accident to determine the adequacy of pipeline information provided to the Supervisory Control and Data Acquisition (SCADA) system and to review control center procedures, alarms, and controller training for recognizing pipeline failures; and, c. Provide a report on the root cause analysis to the Director, Southern Region. 3. Within 60 days after a safety order is issued, CGT is to develop and submit to the Director, Southern Region for approval a work plan to replace all bare, coupled, cathodically unprotected line pipe in the Line P within 12 months from the date of the safety order. The Director may approve plan elements incrementally. At a minimum, the work plan must include: a. A milestone schedule to show the key elements required for pipe replacement such as pipe procurement, permits, begin construction, pressure testing, etc. b. The specific pipeline sections to be replaced identified by mile post or stationing. c. The specifications of the pipe to be installed. d. The name, phone number, and email address of CGT's point-of-contact for the pipe replacement project. 4. CGT is to revise the work plan if necessary to incorporate new information obtained during the pipe replacement project and is to submit any such plan revisions to the Director, Southern Region for approval. The Director may approve plan revisions incrementally. 5. The work plan and all revisions will become incorporated into the safety order. 6. Beginning 90 days after a safety order is issued, CGT is to prepare and submit monthly progress reports to the Director, Southern Region, with sufficient detail to#

220101010S_Notice of Proposed Safety Order_09302010_text.pdf, page 76 allow the Director to track the progress of the pipe replacement project and to provide the Director an opportunity to observe and inspect construction activities as they occur. 7. CGT will implement the work plan as it is approved by the Director, including any revisions to the plan. 8. The Director may grant an extension of time for compliance with any of the terms of the safety order upon a written request timely submitted demonstrating good cause for an extension. 9. The Director may allow the removal or modification of the pressure restriction set forth in Item 1 upon a written request from CGT demonstrating that the hazard has been abated and that restoring the pipeline to its pre-failure operating pressure is justified based on a reliable engineering analysis showing that the pressure increase is safe considering all known defects, anomalies and operating parameters of the pipeline. The Director's determination will be based on all known factors and provisions of evidence that mitigative actions taken by the operator provide for the safe operation of the pipeline segment. 10. CGT may appeal any decision of the Director to the Associate Administrator for Pipeline Safety. Decisions of the Associate Administrator shall be final. The actions proposed by this Notice of Proposed Safety Order are in addition to and do not waive any requirements that apply to Respondent’s pipeline system under 49 C.F.R. Parts 190 through 199, under any other order issued to Respondent under authority of 49 U.S.C. § 60101 et seq., or under any other provision of Federal or state law. After receiving and analyzing additional data in the course of this proceeding and implementation of the work plan, PHMSA may identify other safety measures that need to be taken. In that event, Respondent will be notified of any proposed additional measures and, if necessary, amendments to the work plan or safety order. ___________________________________ __________________ Wayne T. Lemoi Date issued Director, Southern Region Office of Pipeline Safety Pipeline and Hazardous Materials Safety Administration#

220101010S_Closure Letter_12072011_text.pdf, page 1Official PDFCERTIFIED MAIL - RETURN RECEIPT REQUESTED December 7, 2011 Victor Gaglio Sr. Vice President of Operations and Engineering Columbia Gas Transmission LLC 1700 MacCorkle Av., SE Charleston, WV 25314 CPF 2-2010-1010S Dear Mr. Gaglio: On June 17, 2011, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued a Consent Order (Order) to Columbia Gas Transmission LLC (CGT) incorporating the terms of a Consent Agreement signed by PHMSA and CGT on February 11, 2011. The Consent Agreement resulted from a Notice of Proposed Safety Order (Notice) issued to CGT alleging that “CGT’s 20-inch natural gas ‘Line P’ pipeline or a portion thereof has an apparent condition that, without corrective measures, would pose a pipeline integrity risk to public safety, property, or the environment.” Specifically, the Notice alleged that the conditions associated with a September 9, 2010 rupture that occurred on a section of approximately 10 miles of bare cathodically unprotected pipe located in Lawrence County, Kentucky required corrective measures to ensure safety. The PHMSA Southern Region has received and reviewed CGT’s letter of November 17, 2011, in which CGT summarized the actions it has taken to comply with the Order. Our review confirms that CGT has met the terms of the Order. Therefore, no further action is necessary with regards to this Order and this case is now closed. Accordingly, the pressure restriction on Line P is removed. Please be advised that this letter refers only to the Consent Order (CPF 2-2010-1010S) and not to other PHMSA pending cases, if any. Also be advised that nothing herein states or implies that the above described Line P meets the requirements of the federal pipeline safety regulations. The pipeline system remains subject to inspection by PHMSA. Sincerely, Wayne T. Lemoi Director, Office of Pipeline PHMSA Southern Region#

220101010S_Consent Agreement _06172011.pdf, page 1Official PDFllEPARTMENT OF TRANSI'ORTATION PIPELINE ANn H.AZARDOUSMATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY Southell1 Region Atlanta, GA 30303 In the Matter of ) ) ) Columbia Gas Transmission LLC ) Respondent ) ) CPF 2~201O-1010S CONSENT AGREEMENT On Septembt.'T 20, 2010, the Pipeline and Hazardous Materials Safety Administration (PHMSA), U.S. Department ofTransportation, issued to Columbia Gas Transmission LLC (CGT or Respondent) a!'iotice ofPropost-'<i Safety Order (NOPSO). The Notice alleged that conditions exist on CGT's pipeline tllCilities that pose a pipeline integrity risk to public safety, property, or the enviro11ment The Notice also proposed that Respondent take certain con-ective measures to COlTect the alleged conditions and ensur(;' that the public. property. and the environment are protectedliom the potential risk. CGT responded to the Notice by letter dated October 29,2010 (Response). Respondent stated its intent to comply with the tCTIns of the proposed safety order and requested an informal consultation to discuss the Terms of a written consent ab'Tccment and resolve the issues that were raised in the proposed safety order. I An infbnual consultation was held via telephone. During the informal consultation. PHMSA and CGT agreed that settlement of this proceeding will avoid fmther administrative proceedings or litigation and that entry into this Consent Agreement is the most appropriate means of resolving thc Notice. pursuant to 49 C.F.R. Part 190, without adj udication of any issue of fact or law; and upon consent and agreement of Respondent and PHMSA ("the Parties"), the agree as follows: 1. General Provisions L Respondent acknowledges that as operator ofthe pipeline, Respondent and its pipeline system are subject to the jurisdiction of the Federal pipeline safety laws, 49 U.5.C 60101 et seq .. and the re!:,rulations and administrative orders issued thereunder. For purposes of this Consent AgreemenL Respondent acknowledges that it received proper notice ofPHMSA's action in this I CGT'~ RespzlUse is inc:orporated intz' ihis Consent i\greement in whok~ (sec attached).#

220101010S_Consent Agreement _06172011.pdf, page 22 proceeding and that the Notice states claims upon which rclicfmay be f,'Tanted pursuant to 49LJ .S.c. 60101 et and the regulations and orders issued thereunder. 2. Respondent does not admit or dt'l1Y any allegation or conclusion in the Notice but agrees, for purposes of this Consent Ae,.rreement that the condition identified in the Notice exists and agrees to address it by completing the actions specitled in Section II ofthis agreement C"Con"ective Measures"), These actions. including any \vork plans and schedules, shall amomatically be incorporated into this agreement. This Consent At,'Teement does not constitute a finding of violation of Federal law ()r r::;gu]ation and therefore may not be used in any civil proceeding of any kind as evidence or proof of any f~iCt. fault or liabiliry, or as evidence of the violation of any law. rule. regulation or requirement, except in a proceeding to enforce the provisions of this agreement or in future PHMSA e:llltxcement actions. 3. After Respondent returns this signed agreement, PHMSA's representative will present it to the Associate Administrator for Pipeline Safety recommending that the Associate Administrator adopt the terms ofthis agreement by issuing an administrative order (Consent Order) incorporating the terms of this Consent Ab1fet'-'l11ent. The teons of this agreement constitute an offer ofsettlement uutil accepted the Associate Administrator. 4, Respondent consents to the issuance of the Consent Order, and hereby waives any further procedural requirements with respect to its issuance. Respondent waives all rights to contest the adequacy of notice, or the validity (Ifthe Consent Order or this Consent Agreement including all rights to administrative or judi"~ial hearings or appeals. 5. 'fhis Consent Agreement shall apply to and be binding upon PHMSA, and upon Respond<''l1t. its officers. directors. and employees. and its successors, assigns, or other entities or persons otherwise bound by law. Respondent agrees t(\ provide a copy of this agrcmnent and any intorporated work plans and schedules to all of Respondent's officers. employees, and agents whose duties might reasonably include compliance with this agreement. 6. For all transfers of ownership or operating responsibility of Respondent's pipeline, Respondent must provide a copy of this Consent Ai::,1feement to the prospective transferee at least 30 days prior to such transfer and simultaneously provide written notice of the prospc(..1ive transfer to the PHMSA Regional Director who issued the Notice. 7. This Consent Agreement constitutes the final, complete and exclusive agreement and understanding betwcL'l1 the Partics with respect to the settlement embodied in this agreement. and the Parties acknowledge that there are no representations, agreements or understandings relating to the settlement other than those expressly contained 1n this agreement, exc<,>pt that the tenns of this agreement may be construed by reference to the Notice. 8. Nothing in this Consent Agreement affects or relieves Respondent of1tS responsibility to comply with all applicable requirements of the Federal pipeline safety laws, 49 U.S.c. S60101 ef seq .. and the regulations and orders issued thereunder. Nothing in this uh'Teement alters PHMSA's right ofaccess, entry, inspection, and inJeml1nlion gathering or PHMSA's authority to bring enforcement actions against Respondent pursuant to the Federal pipeline safety laws, the reguiations and orders issued th.ereunder, or any other provision of Federal or State law.#

220101010S_Consent Agreement _06172011.pdf, page 3r 9. This Consent Agreement does not waive or modify any Federal. State. or localluws or regulations that arc applicable to Respondent's pipciine systems. This ablTcemcnt is not a pennit or a modificatioll of any permit under any Federal, State, or local laws or regulations. R.cspondent remainsresponsible for achieving and maintaining compliance with all applicable FederaL State. and local laws, regulations and pemlits. 10. This Consent Agreement does not create rights in, or .6lTant any cause of action to, any third party not party to thi~ agreement. The U.S. Department ofTransponation is not liable for any injuries or damages to persons or property arising ii'om acts or omissions of Respondent or its of1icers, employees, or agents carrying out the work required by this agreement. The U.S. Dc-partment ofTransportation, its officers, employees. agents, and representatives are not liable i<lr any cause of action arising from any acts or omissions of Rcspondent or its contractors in carrying out any work required by tbis a.6lTcement. II. Corrective Measures II. Within 365 days following the issuance of the Consent Order, Respondent agrees to pertom1 all Proposed Corrective Measures set f{)rth in tne Notice ofProposeci Safety Order, which is herehy incorporated into this Consent Agreement. Respondent wi11 revise the work plan required by Item 3 of the Proposed Corrective Measures as necessary to incorporate new intcmnation it obtains during the rernedial activities perfiJnncd under the work plan. Respondent will submit any such plnn revisions to the Regional Director fbI' prior approval. The Regional Director may approve work plan elements incrementally. 12. Respondent 3.6lTeeS to submit monthly reports to the Regional Director that: (1) include all available data and results of any testing and evaluations pL-rfonned pursuant to the Proposed Safety Order: and (2) describe the progress ortne repairs or other remedjal actions being undertaken. CGT submitted monthly reports in December 20JO and in January 20J 1 that preceded this Consent Agreement. CGT should continue monthly reports until CGT has completed all the Corrective Measures required by this Consent Agreement. 13. Respondent agrees to maintain documentation of the costs associated with the implementation ofthe Proposed Safety Order. Respondent will include in the third monthly report and every third monthly report it submits thereafter pursuant to paragraph J2, the to-date total costs associated with: (1 ) testing. evaluations and iniom1ation analysis; (2) revisions of procedures and additional monitoring and inspections; and (3) physical changes to pipeline infrastructure, including repairs, replacements and other modifications. J4. The Regional Director may grant an extension oftime f<:)r Respondent to complete any of the work to be performed ifRespondent submits a timely written request demonstrating good cause for an extension. In. Review and Approval Process ] 5. With respect to any submission under Section II of this Consent Agreement that requires the approval of the Regional Director. the Director may: (a) approve, in whole or in part, the submission, (b) approve the submission 011 specified conditions, (c) disapprove, in whole or in part, the submission, or (d) any combination of the foregoing. If the Regional Director approves.#

220101010S_Consent Agreement _06172011.pdf, page 44 approves in part, or approvc~ with conditions. Respondent will take all action as approved by the Director, subject to Respondent's right to invoke the dispute resolution procedures in Section IV with respect to any conditions the Director identifies. If the Director disapproves all or any portion of the submission, the Director will provide Respondent with a written notice ofthe deticiencies. Respondent will correct all deficiencies \\'ithil1 the time specified by the Director and resubmit it for approvaL IV. Dispute Resolution 16. The Regional Director and Respondent \vill informally attempt to resolve any disputes arising under this Consent Agreement. If Respondent and the Regional Director are unable to infonnally resolve the dispute within] 5 days. Respondent may request in writing, within 10 days, a \vritten delenl1ination resolving the dispute from the Associate Administrator for Pipeline Safety providing all information that Respondent beJieves is relevant to the di spute. If the request is submitted as provided herein, the Associate Administrator will issue a final determination in writing. The existence of a dispute and PHMSA's consideration of matters placed in dispute will nor excuse, tolL or suspend any term or timeframe for completion of any work to be performed under this agreement during the pendency of the dispute resolution process except as agreed by the Regional Director or the Associate Administrator in writing. V. Enforcement 17. This Conscnt Agreement, as adopted by the Consent Order. is subject to all enforcement authorities avai.1ableto PHM.SA under 49 U.S.C. § 60101 et seq. and 49 C.F.R. Part 190, including administrative civil penalties und(.'Y § 60112 of up to S1(lO,OOO per violation for each day the violation continues, ifPHMSA determines that Respondent is not proceeding according to the terms ofthe agreement, determinations made by the Regional Director. or if appealed, decisions of the Associate Administrator. All work plans and associated schedules set fc)rth or referenced in Section II will be automatically incorporated into this Consent Agreement and are enforceable in the same manner. vr. Record Keeping and Information Uisclosure (8. Respondent agrees TO maintain records demonstrating compliance with all requirements of this Consent Agreement for a period of at least five years following completion of all work to be perfonned. For any reports, plans. or other deliverab1es required to be submitted to PHMSA pursuant to this Consent AgreemL-'11t, Respondent may asscl1 a claim ofbusiness confidentiality or other protections applicable to the release of infoffi1ation by PHMSA, covering part or all of the infonnation required to be submitted to PHMSA pursuant to this agreemcnt in accordance with 49 C.F.R. Part 7. Respondent must mark the claim of confidentiality in writing on each page, and include a statel11cmt specifying the f,'Tounds for each claim of confidentially. PHMSA detennines release of any infon11ation submitted pursuant to this Consent Agreement in accordance with 49 C.F.R. Part 7, the Freedom of lnfonnation Act 5 l.i.S.C. § 552, DOT and/or PHMSA policies, and other applicable regulations and Executive Orders.#

220101010S_Consent Agreement _06172011.pdf, page 5.r 5 VB. Effective Date 19. The "Effective Date" as used herein is the date on which this Consent Agreement has been signed by both Respondent and PHMSA. VllI. Modification 20. The terms of this Consent Agreement may he moditied by mutual agreement of the parties. Such modifications must be in writing and signed by both parties. IX. Termination 21. This Consent Agreement terminares upon completion of all tcnm set l()lih in Section II (Corrective Measures) as determined by the Director, Southem Region. Respondent may request written confirmation from PHMSA when this af!reement is terminated. To the extent ongoing monitoring is required: PHMSA may terminaie this agreement with respect to all other requirements with the exception of such monitoring. Nothing in this agreement prevents Respondent from completing any ofthc obligations earlier than the deadiines provided for in this Abrreement. X. Ratification 22, The Parties undersigned representatives certify that they arc fully authorized to enter into the terms and conditions of this Consent Agreement and to execute and legally bind such party to this document. 22. The Parties hereby agree to all conditions and tenm ofthis Consent Agreement: ForPHMSA: For Respondent: /' /;/ /' ..' tj/ '"/ lr- //' / illk·-·'7 / / " ._JL.... /.:.<.':£LL"-(~o/ Victor Gaglio // Sr. Vice President, / Operations and Engilleering Columbia Gas Transmission LLC#

220101010S_Consent Order_06172011_text.pdf, page 1Official PDFJUN 17 2011 Mr. Victor Gaglio Sr. Vice President of Operations and Engineering Columbia Gas Transmission, LLC 1700 MacCorkle Avenue, SE Charleston, WV 25314 Re: CPF No. 2-2010-1010S Dear Mr. Gaglio: Enclosed please find a Consent Order incorporating the terms of the Consent Agreement that you signed on February 11, 2011. Service of the Consent Order and Consent Agreement by certified mail is deemed effective upon the date of mailing, or as otherwise provided under 49 C.F.R. § 190.5. Thank you for your cooperation in this matter. Sincerely, Jeffrey D. Wiese Associate Administrator for Pipeline Safety Enclosure cc: Mr. Alan Mayberry, Deputy Associate Administrator for Field Operations, Pipeline Safety Mr. Wayne T. Lemoi, Director, Southern Region, PHMSA Mr. Perry Michael Hoffman, Manager − System Integrity, NiSource Gas Transmission & Storage CERTIFIED MAIL - RETURN RECEIPT REQUESTED [7005 1160 0001 0075 9367]#

220101010S_Consent Order_06172011_text.pdf, page 2U.S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY WASHINGTON, D.C. 20590 ____________________________________ ) In the Matter of ) ) Columbia Gas Transmission LLC, ) CPF No. 2-2010-1010S ) Respondent. ) ____________________________________) CONSENT ORDER By letter dated September 20, 2010 the Pipeline and Hazardous Materials Safety Administration (PHMSA) Office of Pipeline Safety issued a Notice of Proposed Safety Order (Notice) to Columbia Gas Transmission LLC (Respondent) in this case. In accordance with 49 C.F.R. § 190.239, the Notice alleged that Respondent’s 20-inch natural gas “Line P” pipeline or portion thereof has an apparent condition that, without corrective measures, would pose a pipeline integrity risk to public safety, property, or the environment and proposed that Respondent take certain actions to address the condition. Specifically, the Notice alleged that the conditions associated with a September 9, 2010 rupture that occurred on a section of approximately 10 miles of bare cathodically unprotected pipe located in Lawrence County, Kentucky required corrective measures to ensure safety. In response to the Notice, Respondent requested an informal consultation and Respondent and PHMSA engaged in good faith settlement discussions resulting in the Consent Agreement attached to this Order that settles all of the allegations in the Notice. Accordingly, the foregoing Consent Agreement is herby approved and incorporated by reference into this Order. The Respondent is hereby ordered to comply with terms of the Consent Agreement, effective immediately. Pursuant to 49 U.S.C. 60101 et seq. and 49 C.F.R § 190.221, failure to comply with this Consent Order may result in the assessment of civil penalties of up to $100,000 per violation per day, or in the referral of the case for judicial enforcement. The terms and conditions of this Consent Order are effective upon service in accordance with 49 C.F.R. § 190.5. ___________________________________ __________________________ Jeffrey D. Wiese Date Issued Associate Administrator for Pipeline Safety#

220101010S_Consent Agreement_06172011_text.pdf, page 1Official PDFJUN 17 11 DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY Southern Region Atlanta, GA 30303 ____________________________________ In the Matter of ) ) ) Columbia Gas Transmission LLC ) Respondent ) ____________________________________) ) CPF 2-2010-1010S CONSENT AGREEMENT On September 20, 2010, the Pipeline and Hazardous Materials Safety Administration (PHMSA), U.S. Department of Transportation, issued to Columbia Gas Transmission LLC (CGT or Respondent) a Notice of Proposed Safety Order (NOPSO). The Notice alleged that conditions exist on CGT's pipeline facilities that pose a pipeline integrity risk to public safety, property, or the environment. The Notice also proposed that Respondent take certain corrective measures to correct the alleged conditions and ensure that the public, property, and the environment are protected from the potential risk. CGT responded to the Notice by letter dated October 29, 2010 (Response). Respondent stated its intent to comply with the terms of the proposed safety order and requested an informal consultation to discuss the terms of a written consent agreement and resolve the issues that were raised in the proposed safety order.1 An informal consultation was held via telephone. During the informal consultation, PHMSA and CGT agreed that settlement of this proceeding will avoid further administrative proceedings or litigation and that entry into this Consent Agreement is the most appropriate means of resolving the Notice, pursuant to 49 C.F.R. Part 190, without adjudication of any issue of fact or law, and upon consent and agreement of Respondent and PHMSA ("the Parties"), the Parties agree as follows: I. General Provisions 1. Respondent acknowledges that as operator of the pipeline, Respondent and its pipeline system are subject to the jurisdiction of the Federal pipeline safety laws, 49 U.S.C. 60101 et seq., and the regulations and administrative orders issued thereunder. For purposes of this Consent Agreement, Respondent acknowledges that it received proper notice of PHMSA's action in this 1 CGT's Response is incorporated into this Consent Agreement in whole (see attached).#

220101010S_Consent Agreement_06172011_text.pdf, page 22 proceeding and that the Notice states claims upon which relief may be granted pursuant to 49 U.S.C. 60101 et seq. and the regulations and orders issued thereunder. 2. Respondent does not admit or deny any allegation or conclusion in the Notice but agrees, for purposes of this Consent Agreement, that the condition identified in the Notice exists and agrees to address it by completing the actions specified in Section II of this agreement (“Corrective Measures”). These actions, including any work plans and schedules, shall automatically be incorporated into this agreement. This Consent Agreement does not constitute a finding of violation of any Federal law or regulation and therefore may not be used in any civil proceeding of any kind as evidence or proof of any fact, fault or liability, or as evidence of the violation of any law, rule, regulation or requirement, except in a proceeding to enforce the provisions of this agreement or in future PHMSA enforcement actions. 3. After Respondent returns this signed agreement, PHMSA's representative will present it to the Associate Administrator for Pipeline Safety recommending that the Associate Administrator adopt the terms of this agreement by issuing an administrative order (Consent Order) incorporating the terms of this Consent Agreement. The terms of this agreement constitute an offer of settlement until accepted by the Associate Administrator. 4. Respondent consents to the issuance of the Consent Order, and hereby waives any further procedural requirements with respect to its issuance. Respondent waives all rights to contest the adequacy of notice, or the validity of the Consent Order or this Consent Agreement, including all rights to administrative or judicial hearings or appeals. 5. This Consent Agreement shall apply to and be binding upon PHMSA, and upon Respondent, its officers, directors, and employees, and its successors, assigns, or other entities or persons otherwise bound by law. Respondent agrees to provide a copy of this agreement and any incorporated work plans and schedules to all of Respondent's officers, employees, and agents whose duties might reasonably include compliance with this agreement. 6. For all transfers of ownership or operating responsibility of Respondent’s pipeline, Respondent must provide a copy of this Consent Agreement to the prospective transferee at least 30 days prior to such transfer and simultaneously provide written notice of the prospective transfer to the PHMSA Regional Director who issued the Notice. 7. This Consent Agreement constitutes the final, complete and exclusive agreement and understanding between the Parties with respect to the settlement embodied in this agreement, and the Parties acknowledge that there are no representations, agreements or understandings relating to the settlement other than those expressly contained in this agreement, except that the terms of this agreement may be construed by reference to the Notice. 8. Nothing in this Consent Agreement affects or relieves Respondent of its responsibility to comply with all applicable requirements of the Federal pipeline safety laws, 49 U.S.C. § 60101 et seq., and the regulations and orders issued thereunder. Nothing in this agreement alters PHMSA's right of access, entry, inspection, and information gathering or PHMSA's authority to bring enforcement actions against Respondent pursuant to the Federal pipeline safety laws, the regulations and orders issued thereunder, or any other provision of Federal or State law.#

220101010S_Consent Agreement_06172011_text.pdf, page 33 9. This Consent Agreement does not waive or modify any Federal, State, or local laws or regulations that are applicable to Respondent's pipeline systems. This agreement is not a permit, or a modification of any permit, under any Federal, State, or local laws or regulations. Respondent remains responsible for achieving and maintaining compliance with all applicable Federal, State, and local laws, regulations and permits. 10. This Consent Agreement does not create rights in, or grant any cause of action to, any third party not party to this agreement. The U.S. Department of Transportation is not liable for any injuries or damages to persons or property arising from acts or omissions of Respondent or its officers, employees, or agents carrying out the work required by this agreement. The U.S. Department of Transportation, its officers, employees, agents, and representatives are not liable for any cause of action arising from any acts or omissions of Respondent or its contractors in carrying out any work required by this agreement. II. Corrective Measures 11. Within 365 days following the issuance of the Consent Order, Respondent agrees to perform all Proposed Corrective Measures set forth in the Notice of Proposed Safety Order, which is hereby incorporated into this Consent Agreement. Respondent will revise the work plan required by Item 3 of the Proposed Corrective Measures as necessary to incorporate new information it obtains during the remedial activities performed under the work plan. Respondent will submit any such plan revisions to the Regional Director for prior approval. The Regional Director may approve work plan elements incrementally. 12. Respondent agrees to submit monthly reports to the Regional Director that: (1) include all available data and results of any testing and evaluations performed pursuant to the Proposed Safety Order; and (2) describe the progress of the repairs or other remedial actions being undertaken. CGT submitted monthly reports in December 2010 and in January 2011 that preceded this Consent Agreement. CGT should continue monthly reports until CGT has completed all the Corrective Measures required by this Consent Agreement. 13. Respondent agrees to maintain documentation of the costs associated with the implementation of the Proposed Safety Order. Respondent will include in the third monthly report and every third monthly report it submits thereafter pursuant to paragraph 12, the to-date total costs associated with: (1) testing, evaluations and information analysis; (2) revisions of procedures and additional monitoring and inspections; and (3) physical changes to pipeline infrastructure, including repairs, replacements and other modifications. 14. The Regional Director may grant an extension of time for Respondent to complete any of the work to be performed if Respondent submits a timely written request demonstrating good cause for an extension. III. Review and Approval Process 15. With respect to any submission under Section II of this Consent Agreement that requires the approval of the Regional Director, the Director may: (a) approve, in whole or in part, the submission, (b) approve the submission on specified conditions, (c) disapprove, in whole or in part, the submission, or (d) any combination of the foregoing. If the Regional Director approves, approves in part, or approves with conditions, Respondent will take all action as approved by the#

220101010S_Consent Agreement_06172011_text.pdf, page 44 Director, subject to Respondent's right to invoke the dispute resolution procedures in Section IV with respect to any conditions the Director identifies. If the Director disapproves all or any portion of the submission, the Director will provide Respondent with a written notice of the deficiencies. Respondent will correct all deficiencies within the time specified by the Director and resubmit it for approval. IV. Dispute Resolution 16. The Regional Director and Respondent will informally attempt to resolve any disputes arising under this Consent Agreement. If Respondent and the Regional Director are unable to informally resolve the dispute within 15 days, Respondent may request in writing, within 10 days, a written determination resolving the dispute from the Associate Administrator for Pipeline Safety providing all information that Respondent believes is relevant to the dispute. If the request is submitted as provided herein, the Associate Administrator will issue a final determination in writing. The existence of a dispute and PHMSA's consideration of matters placed in dispute will not excuse, toll, or suspend any term or timeframe for completion of any work to be performed under this agreement during the pendency of the dispute resolution process except as agreed by the Regional Director or the Associate Administrator in writing. V. Enforcement 17. This Consent Agreement, as adopted by the Consent Order, is subject to all enforcement authorities available to PHMSA under 49 U.S.C. § 60101 et seq. and 49 C.F.R. Part 190, including administrative civil penalties under § 60122 of up to $100,000 per violation for each day the violation continues, if PHMSA determines that Respondent is not proceeding according to the terms of the agreement, determinations made by the Regional Director, or if appealed, decisions of the Associate Administrator. All work plans and associated schedules set forth or referenced in Section II will be automatically incorporated into this Consent Agreement and are enforceable in the same manner. VI. Record Keeping and Information Disclosure 18. Respondent agrees to maintain records demonstrating compliance with all requirements of this Consent Agreement for a period of at least five years following completion of all work to be performed. For any reports, plans, or other deliverables required to be submitted to PHMSA pursuant to this Consent Agreement, Respondent may assert a claim of business confidentiality or other protections applicable to the release of information by PHMSA, covering part or all of the information required to be submitted to PHMSA pursuant to this agreement in accordance with 49 C.F.R. Part 7. Respondent must mark the claim of confidentiality in writing on each page, and include a statement specifying the grounds for each claim of confidentially. PHMSA determines release of any information submitted pursuant to this Consent Agreement in accordance with 49 C.F.R. Part 7, the Freedom of Information Act, 5 U.S.C. § 552, DOT and/or PHMSA policies, and other applicable regulations and Executive Orders.#

220101010S_Consent Agreement_06172011_text.pdf, page 55 VII. Effective Date 19. The "Effective Date" as used herein is the date on which this Consent Agreement has been signed by both Respondent and PHMSA. VIII. Modification 20. The terms of this Consent Agreement may be modified by mutual agreement of the parties. Such modifications must be in writing and signed by both parties. IX. Termination 21. This Consent Agreement terminates upon completion of all terms set forth in Section II (Corrective Measures) as determined by the Director, Southern Region. Respondent may request written confirmation from PHMSA when this agreement is terminated. To the extent ongoing monitoring is required; PHMSA may terminate this agreement with respect to all other requirements with the exception of such monitoring. Nothing in this agreement prevents Respondent from completing any of the obligations earlier than the deadlines provided for in this Agreement. X. Ratification 22. The Parties undersigned representatives certify that they are fully authorized to enter into the terms and conditions of this Consent Agreement and to execute and legally bind such party to this document. 22. The Parties hereby agree to all conditions and terms of this Consent Agreement: For PHMSA: For Respondent: __________________ ____________________ Wayne T. Lemoi Victor Gaglio Director, Office of Pipeline Safety Sr. Vice President, PHMSA Southern Region Operations and Engineering U.S. Department of Transportation Columbia Gas Transmission LLC#