FLORIDA PUBLIC UTILITIES CO — Notice of Amendment

party submissionOfficial PDF220110007M_Operator_Response_to_Notice_11042011.pdf#

220110007M_Notice of Amendment_10122011_text.pdf, page 1Official PDFNOTICE OF AMENDMENT CERTIFIED MAIL - RETURN RECEIPT REQUESTED October 12, 2011 Kevin Webber Vice President of Business Development and Operations Florida Public Utilities 401 S Dixie Hwy West Palm Beach, FL 33401-5807 CPF 2-2011-0007M Dear Mr. Webber: On September 12-15, 2011, representatives of the Pipeline and Hazardous Materials Safety Administration (PHMSA) inspected the Florida Public Utilities (FPU) written procedures for Operations and Maintenance (O&M) in Winter Haven, Florida, pursuant to Chapter 601 of 49 United States Code. On the basis of the inspection, PHMSA has identified the apparent inadequacies found within FPU’s plans or procedures, as described below: 1. § 191.3 Definitions. As used in this part and the PHMSA Forms referenced in this part— ... Incident means any of the following events: (1) An event that involves a release of gas from a pipeline, or of liquefied natural gas, liquefied petroleum gas, refrigerant gas, or gas from an LNG facility, and that results in one or more of the following consequences: (i) A death, or personal injury necessitating in-patient hospitalization; (ii) Estimated property damage of $50,000 or more, including loss to the operator and others, or both, but excluding cost of gas lost; (iii) Unintentional estimated gas loss of three million cubic feet or more; (2) An event that results in an emergency shutdown of an LNG facility. Activation of an emergency shutdown system for reasons other than an actual emergency does not constitute an incident. (3) An event that is significant in the judgment of the operator, even though it did not meet the criteria of paragraphs (1) or (2) of this definition.#

220110007M_Notice of Amendment_10122011_text.pdf, page 2FPU’s procedure defining an “incident” did not exclude the cost of lost gas in the estimated property damage and did not include the unintentional estimated gas loss of three million cubic feet or more. 2. § 191.5 Immediate notice of certain incidents. (a) At the earliest practicable moment following discovery, each operator shall give notice in accordance with paragraph (b) of this section of each incident as defined in §191.3. (b) Each notice required by paragraph (a) of this section must be made to the National Response Center either by telephone to 800-424-8802 (in Washington, DC, 202 267–2675) or electronically at http://www.nrc.uscg.mil and must include the following information: (1) Names of operator and person making report and their telephone numbers. (2) The location of the incident. (3) The time of the incident. (4) The number of fatalities and personal injuries, if any. (5) All other significant facts that are known by the operator that are relevant to the cause of the incident or extent of the damages. FPU’s procedure for immediate notification of certain incidents did not require notification of the National Response Center and did not incorporate the most recent updates found in the Federal Register published on November 26, 2010. 3. § 192.11 Petroleum gas systems. ... (b) Each pipeline system subject to this part that transports only petroleum gas or petroleum gas/air mixtures must meet the requirements of this part and of ANSI/NFPA 58 and 59. FPU’s odorization procedures did not incorporate the requirements of NFPA 58 (2004), Section 4.2.3. When odorization is required, NFPA 58 (2004), Section 4.2.3, mandates that the presence of odorant be determined by sniff-testing or other means and that the results shall be documented as follows: (1) When LP-Gas is delivered to a bulk plant (2) When shipments of LP-Gas bypass the bulk plant 4. § 192.227 Qualification of welders. (a) Except as provided in paragraph (b) of this section, each welder must be qualified in accordance with section 6 of API 1104 (incorporated by reference, see §192.7) or section IX of the ASME Boiler and Pressure Vessel Code (incorporated by reference, see §192.7). However, a welder qualified under an earlier edition than listed in §192.7 of this part may weld but may not requalify under that earlier edition. FPU’s procedures for the qualification of welders were incorrect because it stated that welders would be qualified in accordance with Section 3 of API 1104 instead of Section 6. 2#

220110007M_Notice of Amendment_10122011_text.pdf, page 35. § 192.383 Excess flow valve installation. ... (b) Installation required. An excess flow valve (EFV) installation must comply with the performance standards in §192.381. The operator must install an EFV on any new or replaced service line serving a single-family residence after February 12, 2010, unless one or more of the following conditions is present: FPU’s procedures for excess flow valve installation were incorrect because they referenced performance standards located in 49 USC and not the performance standards identified in §192.381. 6. § 192.747 Valve maintenance: Distribution systems. (a) Each valve, the use of which may be necessary for the safe operation of a distribution system, must be checked and serviced at intervals not exceeding 15 months, but at least once each calendar year. (b) Each operator must take prompt remedial action to correct any valve found inoperable, unless the operator designates an alternative valve. FPU’s valve maintenance procedures did not require that FPU take prompt remedial action to correct each valve necessary for the safe operation of its distribution system found inoperable or designate an alternative valve. Response to this Notice This Notice is provided pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.237. Enclosed as part of this Notice is a document entitled Response Options for Pipeline Operators in Compliance Proceedings. Please refer to this document and note the response options. 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). If you do not respond within 30 days of receipt of this Notice, this constitutes a waiver of your right to contest the allegations in 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 Final Order. If, after opportunity for a hearing, your plans or procedures are found inadequate as alleged in this Notice, you may be ordered to amend your plans or procedures to correct the inadequacies (49 C.F.R. § 190.237). If you are not contesting this Notice, we propose that you submit your amended procedures to my office within 60 days of receipt of this Notice. This period may be extended by written request for good cause. Once the inadequacies identified herein have been addressed in your amended procedures, this enforcement action will be closed. 3#

220110007M_Notice of Amendment_10122011_text.pdf, page 4It is requested (not mandated) that Florida Public Utilities maintain documentation of the safety improvement costs associated with fulfilling this Notice of Amendment (preparation/revision of plans, procedures) and submit the total to Wayne T. Lemoi, Director, Office of Pipeline Safety, PHMSA Southern Region. In correspondence concerning this matter, please refer to CPF 2-2011-0007M and, for each document you submit, please provide a copy in electronic format whenever possible. Sincerely, Wayne T. Lemoi Director, Office of Pipeline Safety PHMSA Southern Region Enclosure: Response Options for Pipeline Operators in Compliance Proceedings cc: Mike McCarty Safety and Training Manager Florida Public Utilities 1015 6th Street NW Winter Haven, FL 33881-4018 4#

220110007M_closure letter_01242012_text.pdf, page 1Official PDFCERTIFIED MAIL - RETURN RECEIPT REQUESTED January 24, 2012 Kevin Webber Vice President of Business Development and Operations Florida Public Utilities 401 S Dixie Hwy West Palm Beach, FL 33401-5807 CPF 2-2011-0007M Dear Mr. Webber: On September 12-15, 2011, representatives of the Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS), Southern Region inspected the Florida Public Utilities (FPU) written procedures for Operations and Maintenance (O&M) in Winter Haven, Florida, pursuant to Chapter 601 of 49 United States Code. As a result of the inspection, PHMSA issued a Notice of Amendment (NOA) on October 12, 2011. FPU responded to the NOA in a letter dated November 4, 2011. The PHMSA Southern Region reviewed the written response and subsequently held conversations with FPU personnel. As a result, we find FPU’s response adequate. Therefore, this letter is to inform you that FPU has complied with the terms of the NOA and that no further action is necessary with regards to the NOA. This case is now closed. Please be advised that this letter refers only to the NOA (re: CPF 2-2011-0007M) and not to any other PHMSA pending cases. Also be advised that nothing herein states or implies that the above described O&M meets the requirements of the federal pipeline safety regulations or that the O&M is approved. The pipeline system and O&M remain subject to inspection by PHMSA. Sincerely, Wayne T. Lemoi Director, Office of Pipeline Safety PHMSA Southern Region cc: Mike McCarty Safety and Training Manager Florida Public Utilities 1015 6th Street NW Winter Haven, FL 33881-4018#