{"operation":"document","citation":"CPF 220111007","title":"SOUTHEAST SUPPLY HEADER, LLC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2011-09-21","effective_on":null,"summary":"CLOSED notice of probable violation citing 190.203(f).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-220111007.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-220111007.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-220111007","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/220111007","body":"Notice of Probable Violation involving SOUTHEAST SUPPLY HEADER, LLC. PHMSA's enforcement data identifies the cited regulation as 190.203(f). The case was opened on 2011-09-21 and is reported as closed as of 2013-05-01. Proposed civil penalty: $26,800. Assessed civil penalty: $26,800. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n220111007_closure letter_05012013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220111007/220111007_closure%20letter_05012013.pdf\n\n220111007_closure letter_05012013_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220111007/220111007_closure%20letter_05012013_text.pdf\n\n220111007_Final Order_06122012.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220111007/220111007_Final%20Order_06122012.pdf\n\n220111007_Final Order_06122012_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220111007/220111007_Final%20Order_06122012_text.pdf\n\n220111007_nopv_pcp_pco_09212011.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220111007/220111007_nopv_pcp_pco_09212011.pdf\n\n220111007_nopv_pcp_pco_09212011_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220111007/220111007_nopv_pcp_pco_09212011_text.pdf\n\n220111007_Operator Response Notice_11012011.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220111007/220111007_Operator%20Response%20Notice_11012011.pdf\n\n220111007_closure letter_05012013_text.pdf\n\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nMay 1, 2013\nMr. Pete M. Kirsch\nDivision Sr. VP Pipeline Ops & Engr.\nSoutheast Supply Header, L.L.C.\n1111 Louisiana\nHouston, TX 77002\nCPF 2-2011-1007\nDear Mr. Kirsch:\nOn June 12, 2012, the Pipeline and Hazardous Materials Safety Administration (PHMSA),\nOffice of Pipeline Safety (OPS) issued to the Southeast Supply Header, L.L.C. (SESH) a\nFinal Order in the above-referenced case. The Order included a Compliance Order and an\nassessed civil penalty.\nThe OPS Southern Region received and reviewed SESH’s April 1, 2013, written response to\nthe compliance items in the Order. Based on our review of SESH’s response and our\nconfirmation that SESH has paid the civil penalty, we have determined that SESH has\ncomplied with the terms of the Order. Accordingly, this case is now closed and no further\naction is necessary with respect to the matters involved in this case.\nPlease be advised that this letter refers only to the above described order (CPF 2-2011-1007)\nand not to any other PHMSA pending cases.\nThank you for your cooperation in this matter.\nSincerely,\nWayne T. Lemoi\nDirector, Office of Pipeline Safety\nPHMSA Southern Region\n\n220111007_Final Order_06122012_text.pdf\n\nJUNE 12, 2012\nMr. Pete M. Kirsch\nDivision Senior Vice-President\nPipeline Operations & Engineering\nSoutheast Supply Header, LLC\nP. O. Box 4567\nHouston, TX 77210\nRe: CPF No. 2-2011-1007\nDear Mr. Kirsch:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation, assesses a civil penalty of $26,800, and specifies actions that need to be taken by\nSoutheast Supply Header, LLC, to comply with the pipeline safety regulations. This letter\nacknowledges receipt of the full penalty amount, by wire transfer, dated November 2, 2011.\nWhen the terms of the compliance order have been completed, as determined by the Director,\nSouthern Region, this enforcement action will be closed. Service of the Final Order by\ncertified mail is deemed effective upon the date of mailing, or as otherwise provided under 49\nC.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nJeffrey D. Wiese\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Mr. David M. McClanahan, President, CenterPoint Energy, Inc., P. O. Box 4567,\nHouston, TX 77210\nMr. Wayne Lemoi, Southern Region Director, OPS\nMr. Alan Mayberry, Deputy Associate Administrator for Field Operations, OPS\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\n____________________________________\n)\nIn the Matter of )\n)\nSoutheast Supply Header, LLC, ) CPF No. 2-2011-1007\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nOn July 17, 2008, pursuant to 49 U.S.C. § 60118(c), the Associate Administrator, Pipeline and\nHazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS), issued a\nspecial permit to Southeast Supply Header, LLC (SESH), waiving compliance with certain\nPHMSA regulations1 in connection with the construction and operation of a 274-mile natural gas\ntransmission pipeline from Delhi, Louisiana, to Coden, Alabama, and known generally as “Line\n100” (Special Permit). Line 100 is a joint venture between subsidiaries of CenterPoint Energy,\nInc., and Spectra Energy Corporation.2 The Special Permit imposed 47 conditions on the portion\nof Line 100 that SESH proposed to operate above 72% of the specified minimum yield strength\n(SMYS) of the line, to ensure that pipeline safety would not be compromised.3\nOn May 3-7, 2010, pursuant to 49 U.S.C. § 60117, a PHMSA representative conducted an on-\nsite pipeline safety inspection of SESH’s records and procedures in Shreveport, Louisiana. On\nAugust 2-5, 2010, OPS conducted a second inspection of the company’s pipeline facilities from\nDelhi, Louisiana, to Coden, Alabama. As a result of the inspections, the Director, Southern\nRegion, OPS (Director), issued to Respondent, by letter dated September 21, 2011, a Notice of\nProbable Violation, Proposed Civil Penalty, and Proposed Compliance Order (Notice), alleging\nnon-compliance with certain conditions of the Special Permit. In accordance with\n49 C.F.R. § 190.207, the Notice proposed finding that SESH had violated the conditions of the\nSpecial Permit and assessing a civil penalty of $26,800 for the alleged violations.\n1 49 C.F.R. §§ 192.111 and 192.201.\n2 See http://www.spectraenergy.com and http://www.centerpointenergy.com (last assessed 5/4/2012).\n3 See Docket # PHMSA 2007-27607 in the Federal Docket Management System (FDMS) located on the Internet at\nhttp://wwww.regulations.gov.\n\n\n\n2\nSESH responded to the Notice by letter dated November 1, 2011 (Response). The company did\nnot contest the allegations of violation and paid the proposed civil penalty of $26,800, as\nprovided in 49 C.F.R. § 190.227. Payment of the penalty serves to close the case with prejudice\nto Respondent.\nFINDINGS OF VIOLATION\nItem 1: The Notice alleged that Respondent violated Special Permit Condition 13, which states:\n13) Temperature Control: The compressor station discharge temperature must\nbe limited to 120º Fahrenheit. A temperature above this maximum\ntemperature of 120º Fahrenheit may be approved if SESH technical\ncoating operating tests show that the pipe coating will properly withstand\nthe higher operating temperature for long term operations. If the\ntemperature exceeds 120º Fahrenheit SESH must also institute a coating\nmonitoring program in these areas using ongoing Direct Current Voltage\nGradient (DCVG) surveys or Alternating Current Voltage Gradient\n(ACVG) surveys or other testing to demonstrate the integrity of the\ncoating. This program and results must be provided to the regional\noffices of PHMSA where the pipe is in service.\nThe Notice alleged that Respondent violated Condition 13 of the Special Permit by failing to\nlimit discharge temperatures to 120º F or less at five compressor stations. Specifically, the\nNotice alleged that the temperatures of the discharged natural gas at the Delhi, Gwinville,\nCollins, Petal, and Lucedale compressor stations exceeded 120º F on various occasions between\nthe date the pipeline began operating under the Special Permit (November 8, 2008) and March\n31, 2010. Respondent did not contest this allegation of violation. Accordingly, based upon a\nreview of all of the evidence, I find that Respondent violated Condition 13 of the Special Permit\nby failing to limit discharge temperatures to 120º F at five compressor stations at various times\nbetween the dates shown above.\nItem 3: The Notice alleged that Respondent violated Special Permit Condition 43, which states,\nin relevant part:\n43) Anomaly Evaluation and Repair: Anomaly evaluations and repairs in the\nspecial permit area, regardless of HCA status, must be performed based\nupon the following:\na) . . .\nd) Anomaly Assessment Methods . . .\n– Dents in the pipe in the special permit area must be evaluated and\nrepaired per 49 C.F.R. § 192.309(b) for the baseline geometry tool run\nand per 49 C.F.R. § 192.933(d) for future ILI. Pipe must be evaluated\n\n\n\n3\nfor out-of-roundness on the baseline geometry tool run and all\nindications in the pipeline above 6% out-of-roundness must be\nremediated.\nThe Notice alleged that Respondent violated Condition 43 of the Special Permit by failing to\nadequately evaluate and repair a dent in Line 100, in accordance with 49 C.F.R. § 192.309(b),\nand that had been discovered through a baseline geometry tool run. Specifically, the Notice\nalleged that SESH had run the in-line inspection (ILI) tool on Line 100 and had received a final\nreport from the vendor dated August 21, 2008. The report showed a 5.3% dent (Feature No.\n218) that SESH failed to evaluate and repair. Condition 43 required SESH to evaluate and repair\na dent that exceeded “more than 2% of the nominal pipe diameter,” per § 192.309(b)(3)(ii).\nThe Notice further alleged that SESH had failed to adequately evaluate the data from the same\nILI tool run on Line 100 for indications of out-of-roundness. It alleged that in May 2010, SESH\nhad received another report from its contract auditor stating that Features No. 127 and 134 (as\nshown in the ILI vendor’s August 3, 2008 final report) exceeded 6% out of roundness, but that\nthe company failed to properly evaluate this data or promptly remediate the anomalies.\n4\nRespondent did not contest these allegations of violation. Accordingly, based upon a review of\nall of the evidence, I find that Respondent violated Condition 43 of the Special Permit by failing\nto adequately evaluate and repair a dent on Line 100 per § 192.309(b) and to properly evaluate\nand remediate two features that exceeded 6% out of roundness.\nASSESSMENT OF PENALTY\nUnder 49 U.S.C. § 60122, Respondent is subject to an administrative civil penalty not to exceed\n$100,000 per violation for each day of the violation, up to a maximum of $1,000,000 for any\nrelated series of violations. In determining the amount of a civil penalty under\n49 U.S.C. § 60122 and 49 C.F.R. § 190.225, I must consider the following criteria: the nature,\ncircumstances, and gravity of the violation, including adverse impact on the environment; the\ndegree of Respondent’s culpability; the history of Respondent’s prior offenses; the Respondent’s\nability to pay the penalty and any effect that the penalty may have on its ability to continue doing\nbusiness; and the good faith of Respondent in attempting to comply with the pipeline safety\nregulations. In addition, I may consider the economic benefit gained from the violation without\nany reduction because of subsequent damages, and such other matters as justice may require.\nThe Notice proposed a total civil penalty of $26,800 for the violations cited above.\nItem 1: The Notice proposed a civil penalty of $13,700 for Respondent’s violation of Special\nPermit Condition 13, for failing to limit compressor station discharge temperatures to 120º F at\nfive compressor stations. SESH neither contested the allegation nor presented any evidence or\nargument justifying a reduction in the proposed penalty. In order for a pipeline operator to\nreceive, and continue to operate under, a waiver of the pipeline safety regulations, it is essential\n4 Feature 127 indicated 6.17% out-of-roundness and Feature 134 indicated 6.98%.\n\n\n\n4\nthat the operator scrupulously adhere to the conditions in the special permit. Accordingly,\nhaving reviewed the record and considered the assessment criteria, I assess Respondent a civil\npenalty of $13,700, which was remitted on November 2, 2011.\nItem 3: The Notice proposed a civil penalty of $13,100 for Respondent’s violation of Special\nPermit Condition 43, for failing to adequately evaluate and repair a dent in Line 100, per\n49 C.F.R. § 192.309(b), and to properly evaluate and remediate two features that exceeded 6%\nout of roundness. SESH neither contested the allegation nor presented any evidence or argument\njustifying a reduction in the proposed civil penalty. As noted above, in order for a pipeline\noperator to receive, and continue to operate under, a waiver of the pipeline safety regulations, it\nis essential that the operator scrupulously adhere to the conditions in a special permit.\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a civil penalty of $13,100, which amount was remitted on November 2, 2011.\nIn summary, having reviewed the record and considered the assessment criteria for each of the\nItems cited above, I assess Respondent a total civil penalty of $26,800.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Item 1 in the Notice for violating\nCondition 13 of the Special Permit. Under 49 U.S.C. § 60118(a), each person who engages in\nthe transportation of gas or who owns or operates a pipeline facility is required to comply with\nthe applicable safety standards established under chapter 601. Pursuant to the authority of\n49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217, Respondent is ordered to take the following\nactions to ensure compliance with the pipeline safety regulations applicable to its operations:\n1. With respect to Item 1 of the Notice (Special Permit Condition 13), pertaining to the\nfailure of SESH to limit the discharge temperatures to 120º F at the Delhi, Gwinville,\nCollins, Petal, and Lucedale compressor stations, SESH must either:\na. modify its compressor station operations, procedures, and/or facilities to\nensure that the discharge temperature at each of the five compressor stations\non Line 100 does not exceed 120º F, as required by Special Permit Condition\n13;\nOR\nb. notify the Director in writing of its intent to operate Line 100 at discharge\ntemperatures above 120º F. To do so, SESH must provide PHMSA with\ntechnical coating operating tests to show that the pipe coating can properly\nwithstand the higher operating temperatures for long-term operations and\nmust institute and provide to PHMSA a coating monitoring program, as\ndescribed in Special Permit Condition 13.\n\n\n\n5\nSESH must complete either Compliance Item 1(a) or 1(b) above within 60 days of\nreceipt of the Final Order or PHMSA may issue a show cause letter modifying,\nrevoking, or suspending the Order issued under PHMSA-2007-27607.\n2. With respect to Item 1 of the Notice (Special Permit Condition 13), pertaining to the\nfailure of SESH to limit the compressor station discharge temperatures to 120º F at\nfive compressor stations, and notwithstanding Compliance Order Item 1 above, SESH\nmust develop and implement a coating assessment program downstream of the five\ncompressor stations on Line 100 to ensure the coating has not been damaged or\ncompromised. This assessment must be completed using:\n- Direct Current Voltage Gradient (DCVG) surveys;\n- Alternating Current Voltage Gradient surveys; or\n- Other testing to demonstrate the integrity of the coating.\nIn its coating assessment program, SESH must address the following:\na. The coating on the pipe for at least five miles downstream of each of the five\ncompressor stations or to a point on each pipeline where the actual or\npredicted temperature consistently dropped below 120º F, whichever is further\ndownstream;\nb. A technical analysis to determine or predict the highest temperature that Line\n100 experienced, or was projected to experience, immediately downstream of\neach of the five compressor stations, and to determine a point on each pipeline\nwhere the actual or predicted temperature consistently dropped below 120º F;\nc. Technical coating operating tests to show the pipe coating could properly\nwithstand the operating temperatures determined or predicted;\nd. If using DCVG and/or ACVG, define threshold survey indication values\n(% IR for DCVG and dBµV for ACVG). The values should represent the\nmid-range of the “Moderate” category in the severity classification used to\ncharacterize survey indications;\ne. Excavation and remediation of all indications found above the threshold\nvalues;\nf. A calibration dig on at least one anomaly classified as “Minor,” to ensure\nfindings that all indications found above the threshold values in the\nremediation plan are not detrimental to the pipeline;\ng. Perform holiday voltage tests (jeep) and coating adhesion tests at all\nexcavations;\nh. Disbonded, blistered or coating with cracking and/or other damage that could\ncompromise cathodic protection found during excavations must be removed\nand new coating applied;\ni. The coating assessment must be completed no later than six months after the\ndate of this Compliance Order; and\nj. Submit the results of the coating assessment to the Director for review and\napproval no later than 90 days after the coating assessment is complete but not\n\n\n\n6\nlater than nine months after the date of this Compliance Order.\nSESH must complete the work listed above within nine months of receipt of the Final\nOrder or PHMSA may issue a show cause letter modifying, revoking, or suspending\nthe Order issued under PHMSA-2007-27607.\n3. It is requested (not mandated) that SESH maintain documentation of the safety\nimprovement costs associated with fulfilling this Compliance Order and submit the\ntotal to the Director, Office of Pipeline Safety, PHMSA Southern Region. It is\nrequested that these costs be reported in two categories: 1) total cost associated with\npreparation/revision of plans, procedures, studies and analyses; and 2) total cost\nassociated with replacements, additions and other changes to pipeline infrastructure.\nThe Director may grant an extension of time to comply with any of the required items upon a\nwritten request timely submitted by the Respondent and demonstrating good cause for an\nextension.\nFailure to comply with this Order may result in the administrative assessment of civil penalties\nnot to exceed $100,000 for each violation for each day the violation continues or in referral to the\nAttorney General for appropriate relief in a district court of the United States.\nWARNING ITEM\nWith respect to Item 2, the Notice alleged a probable violation of Special Permit Condition 36\nbut did not propose a civil penalty or compliance order for this item. Therefore, this is\nconsidered to be a warning item. The warning was for:\nItem 2 (Special Permit Condition 36) ─ Respondent’s alleged failure to comply\nwith Special Permit Condition 36, as set forth in the Special Permit Order of July\n17, 2008. SESH did not employ line-of-sight markings on the pipeline in the\nSpecial Permit area.\nSESH presented information in its Response showing that it had taken certain actions to address\nthis item. If OPS finds a violation of this Condition 36 in a subsequent inspection, Respondent\nmay be subject to future enforcement action or revocation of the Special Permit.\nUnder 49 C.F.R. § 190.215, Respondent has a right to submit a Petition for Reconsideration of\nthis Final Order. The petition must be sent to: Associate Administrator, Office of Pipeline\nSafety, PHMSA, 1200 New Jersey Avenue, SE, East Building, 2nd Floor, Washington, DC\n20590, with a copy sent to the Office of Chief Counsel, PHMSA, at the same address. PHMSA\nwill accept petitions received no later than 20 days after receipt of service of this Final Order by\nthe Respondent, provided they contain a brief statement of the issue(s) and meet all other\nrequirements of 49 C.F.R. § 190.215. The filing of a petition automatically stays the payment of\nany civil penalty assessed. Unless the Associate Administrator, upon request, grants a stay, all\n\n\n\n7\nother terms and conditions of this Final Order are effective upon service in accordance with\n49 C.F.R. § 190.5.\nIssuance of this Final Order does not preclude PHMSA from seeking modification, suspension or\nrevocation of the Special Permit issued under PHMSA 2007-27607 at any time, as provided in\n49 C.F.R. § 190.341(h)(1)(v). If such action is taken, PHMSA will provide SESH with the\nopportunity to show cause why the proposed action should not be taken.\nThe terms and conditions of this Final Order are effective upon service in accordance with\n49 C.F.R. § 190.5.\n___________________________________ __________________________\nJeffrey D. Wiese Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":20713}