{"operation":"document","citation":"CPF 22022011WL","title":"FLORIDA PUBLIC UTILITIES CO — Warning Letter","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2022-10-06","effective_on":null,"summary":"CLOSED warning letter citing 191.22(c)(1)(vi), 191.22(c)(2)(iii), 192.1015(a), 192.11(b), 192.491(c), 192.725(b), 192.739(a), 192.805(b).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-22022011wl.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-22022011wl.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-22022011wl","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/22022011WL","body":"Warning Letter involving FLORIDA PUBLIC UTILITIES CO. PHMSA's enforcement data identifies the cited regulations as 191.22(c)(1)(vi),  191.22(c)(2)(iii),  192.1015(a),  192.11(b),  192.491(c),  192.725(b),  192.739(a),  192.805(b). The case was opened on 2022-10-06 and is reported as closed as of 2022-10-06. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n22022011WL_Warning Letter_10062022_(21-214414).pdf: https://primis.phmsa.dot.gov/enforcement-documents/22022011WL/22022011WL_Warning%20Letter_10062022_(21-214414).pdf\n\n22022011WL_Warning Letter_10062022_(21-214414)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/22022011WL/22022011WL_Warning%20Letter_10062022_(21-214414)_text.pdf\n\n22022011WL_Warning Letter_10062022_(21-214414)_text.pdf\n\nWARNING LETTER\nELECTRONIC DELIVERY VIA EMAIL TO JSSYVESTER@CHPK.COM\nOctober 6, 2022\nMr. Jeff Sylvester\nSenior Vice President and COO\nChesapeake Utilities Corporation\n500 Energy Lane\nDover, DE 19904\nCPF 2-2022-011-WL\nDear Mr. Sylvester:\nBetween July 19 and December 16, 2021, a representative of the Pipeline and Hazardous\nMaterials Safety Administration (PHMSA) inspected Florida Public Utilities Company’s1 LP-\nGas distribution systems in Alachua, Citrus, Hillsborough, Marion, and Polk counties, Florida,\npursuant to Chapter 601 of 49 United States Code (U.S.C.).\nAs a result of the inspection, it is alleged that Florida Public Utilities Company (FPU) has\ncommitted probable violations of the Pipeline Safety Regulations, Title 49, Code of Federal\nRegulations (CFR). The items inspected and the probable violations are:\n§ 191.22 National Registry of Operators.\n. . . .\n1 Florida Public Utilities Company is a wholly-owned subsidiary of Chesapeake Utilities Corporation. Chesapeake\nUtilities Corporation website, https://chpk.com/about-us/our-businesses/florida-public-utilities/, last retrieved\n07/01/2022.\n\n\n\nChanges. Each operator of a gas pipeline, gas pipeline facility, UNGSF, LNG\nplant, or LNG facility must notify PHMSA electronically through the National\nRegistry of Operators at https://portal.phmsa.dot.gov of certain events.\nAn operator must notify PHMSA of any of the following events not later than\n60 days before the event occurs:\n(i) . . . .\n(ii) A pipeline converted for service under § 192.14 of this chapter, or a change in\ncommodity as reported on the annual report as required by § 191.17.\nAn operator must notify PHMSA of any of the following events not later than\n60 days after the event occurs:\n(i) . . . .\n(ii) A change in the entity (e.g., company, municipality) responsible for an existing\npipeline, pipeline segment, pipeline facility, UNGSF, or LNG facility;\nFPU did not meet the requirements of the regulation because it did not notify PHMSA\nthrough the National Registry of Operators of certain events that occurred at the Villas at\nLake Smart apartments. Specifically, FPU did not meet the requirements of\n§ 191.22(c)(1)(vi), because it did not notify PHMSA not later than 60 days prior to changing\nthe commodity transported from LP-Gas to Natural Gas and § 191.22(c)(2)(iii), because it\ndid not notify PHMSA not later than 60 days after a change in entity responsible for an\nexisting pipeline.\nOn or about December 30, 2020, FPU changed the commodity transported at the Villas at\nLake Smart apartments from LP-Gas to Natural Gas and changed the entity responsible for\noperation of the pipeline system from Florida Public Utilities (Operator ID 5330) to Central\nFlorida Gas (Operator ID 2188). According to the Florida Public Utilities website2, Central\nFlorida Gas officially became a division of Florida Public Utilities in March 2011.\nNotwithstanding any relationship between the companies, they operate under separate\nPHMSA Operator IDs and are required to notify PHMSA of any changes in the entity\nresponsible for operating an existing pipeline or pipeline segment.\nFPU electronically notified PHMSA, through the National Registry of Operators, of these\nchanges on or about August 10, 2021. The notifications were in response to a PHMSA\ninspection identifying that FPU had not notified PHMSA of these events.\n§ 192.11 Petroleum gas systems.\n. . . .\nEach pipeline system subject to this part that transports only petroleum gas or\npetroleum gas/air mixtures must meet the requirements of this part and of\nANSI/NFPA 58 and 59.\nFPU did not meet the requirements of the regulation because it did not meet the\nrequirements of NFPA 58 (2004)3 for each pipeline system subject to Part 192, as follows:\n2 Florida Public Utilities website, https://fpuc.com/centralfloridagasinfo/, last retrieved 07/01/2022.\n3 The 2004 edition of NFPA 58, “Liquefied Petroleum Gas Code (LP-Gas Code),” is the edition currently\nincorporated by reference in § 192.7(i)(2).\n\n\n\nA. NFPA 58 § 6.7.2.4\nRain caps or other means shall be provided to minimize the possibility of the\nentrance of water or other extraneous matter into the relief device or any\ndischarge piping. Provision shall be made for drainage where the accumulation of\nwater is anticipated.\nNFPA 58 § 6.7.2.5\nThe rain cap or other protector shall be designed to remain in place, except during\npressure relief device operation and shall not restrict pressure relief device flow.\nFPU failed to meet the requirements of NFPA 58 §§ 6.7.2.4 and 6.7.2.5, which required it to\nprotect the container relief device from the entrance of water or other extraneous matter by\nproviding a rain cap or other protector and ensuring that the rain cap or other protector\nremained in place. The required protection serves to minimize the possibility of extraneous\nmatter interfering with the relief device operation and to serve as an indicator that the\npressure relief device had operated.\nThe PHMSA inspector observed and documented container relief devices with no rain cap\nor other protection in place at containers serving the Antigua Cove, Blackwater Oaks,\nCrescent Woods, Cypress Trace, Grandview Landings, Hawk Creek Reserve, and Highlands\nin the Woods LP-Gas distribution systems. Some of the relief devices with missing rain cap\nor other protection were found filled with extraneous matter and/or water.\nB. NFPA 58 § 6.7.4.4\nAll regulators for outdoor installations shall be designed, installed, or protected so\ntheir operation will not be affected by the elements (freezing rain, sleet, snow, ice,\nmud, or debris).\nFPU failed to meet the requirements of NFPA 58 § 6.7.4.4 because it did not protect\nregulators for outdoor installation, so their operation would not be affected by the elements,\nby enclosing the regulator in a housing, under a cover, or by mounting the regulator with the\nvent pointing vertically downward. In part, this requirement minimizes the possibility of\npressure control failures caused by the regulator vent becoming blocked by ice, water\nentering the spring case and freezing or corroding internal parts, or debris entering the spring\ncase and interfering with normal operation.\nThe PHMSA inspector observed and documented outdoor regulator installations with the\nregulator vent pointing horizontally and that were not protected by cover or housing at the\nCrescent Woods and Hawk Creek Reserve LP-Gas distribution systems.\n§ 192.491 Corrosion control records.\n. . . .\nEach operator shall maintain a record of each test, survey, or inspection\nrequired by this subpart in sufficient detail to demonstrate the adequacy of corrosion\ncontrol measures or that a corrosive condition does not exist. These records must be\nretained for at least 5 years with the following exceptions:\nOperators must retain records related to §§ 192.465(a) and (e) and 192.475(b)\nfor as long as the pipeline remains in service.\n\n\n\nOperators must retain records of the two most recent atmospheric corrosion\ninspections for each distribution service line that is being inspected under the interval\nin § 192.481(a)(2).\nFPU did not meet the requirements of the regulation because it did not maintain records of\nexternal corrosion control examinations of exposed buried pipelines conducted pursuant to\n§ 192.459. Specifically, FPU did not maintain records of external examinations conducted\nwhen it exposed and removed buried LP-Gas containers from service.\nFPU exposed and removed four (4) 2,000-gallon LP-Gas containers from its Antigua Cove\nLP-Gas distribution system in August 2016, and six (6) 1,000-gallon LP-Gas containers\nfrom its Villas at Lake Smart LP-Gas distribution system between December 2020 and\nJanuary 2021. FPU did not have records of any external examinations that were conducted\nwhen the containers were exposed and removed from their respective systems.\nFPU agreed that it did not have records of the required inspections. After the inspector\nidentified this issue, FPU revised various sections of its Operation and Maintenance manuals\nto include specific requirements that LP-Gas containers be examined and documented when\nburied containers are exposed.\n§ 192.725 Test requirements for reinstating service lines.\n. . . .\nEach service line temporarily disconnected from the main must be tested from\nthe point of disconnection to the service line valve in the same manner as a new service\nline, before reconnecting. However, if provisions are made to maintain continuous\nservice, such as by installation of a bypass, any part of the original service line used to\nmaintain continuous service need not be tested.\nFPU did not meet the requirements of the regulation because it did not test each service line\ntemporarily disconnected from the main, from the point of disconnection to the service line\nvalve, in the same manner as a new service line before reconnecting it.\nFPU leak repair records showed seven (7) instances where FPU did not properly test service\nlines before reconnecting, as follows:\n• October 2016 - 1 service line on NW 231st Way (Newberry Oaks system)\n• February 2017 - 1 service line on NW 11th Rd (Newberry Oaks system)\n• February 2018 - 2 service lines on NW 5th PL (Newberry Oaks system)\n• February 2019 - 1 service line on Highlands in the Woods Dr (Highlands in the Woods\nsystem)\n• June 2019 - 1 service line on Sea Grape Dr (Antigua Cove system)\n• December 2020 - 1 service line on Sea Grape Dr (Antigua Cove system)\nFPU acknowledged that it had not pressure tested the temporarily disconnected service lines\nfrom the point of disconnection to the service line valve in the same manner as a new service\nline before reconnecting. After the inspector identified this issue, FPU revised various\nsections of its Operation and Maintenance manuals to include pressure testing of temporarily\ndisconnected service lines in accordance with the § 192.725 requirements.\n\n\n\n§ 192.739 Pressure limiting and regulating stations: Inspection and testing.\nEach pressure limiting station, relief device (except rupture discs), and\npressure regulating station and its equipment must be subjected at intervals not\nexceeding 15 months, but at least once each calendar year, to inspections and tests to\ndetermine that it is -\nIn good mechanical condition;\nAdequate from the standpoint of capacity and reliability of operation for the\nservice in which it is employed;\nExcept as provided in paragraph (b) of this section, set to control or relieve at\nthe correct pressure consistent with the pressure limits of § 192.201(a); and\nProperly installed and protected from dirt, liquids, or other conditions that\nmight prevent proper operation.\nFPU did not meet the requirements of the regulation because it did not inspect and test each\npressure regulating station and its equipment at intervals not exceeding 15 months, but at\nleast once each calendar year.\nRegulator station inspection records for the Antigua Cove system showed that FPU did not\ninspect all the regulators at its regulator station from 2018 to 2020. The regulator station at\nAntigua Cove consisted of two (2) regulator runs, a primary and secondary run. FPU\nrecords showed that only the primary run was inspected in calendar years 2018, 2019, and\n2020, with notes indicating that the secondary run was not in service. FPU personnel stated\nthat the secondary regulator run was not in use and left off due to lack of demand in the\nsystem.\nFPU acknowledged that it did not inspect the secondary regulator run at Antigua Cove in\n2018, 2019, and 2020. In response, FPU instructed its technicians to inspect all regulators at\nmetering and regulating stations regardless of whether the regulators were on actively\noperating runs.\n§ 192.805 Qualification program.\nEach operator shall have and follow a written qualification program. The program\nshall include provisions to:\n. . . .\nEnsure through evaluation that individuals performing covered tasks are\nqualified;\nFPU did not meet the requirements of the regulation because it did not ensure that its\ncontractors, who performed covered tasks, were qualified when they allowed them to\nperform covered tasks. Specifically, in August and September 2019, FPU allowed two (2)\ncontractors who were not qualified to perform covered task 419OP, Cathodic Protection\nPotential Measurement. FPU Service orders showed that:\n• Contractor 1 performed covered task 419OP on or about August 20, 2019, on the\nCypress Trace LP-Gas distribution system. Contractor 1’s qualification records showed\nthat the qualification for this task expired in January 2019 with no subsequent renewal\nor requalification prior to performing the task.\n\n\n\n• Contractor 2 performed covered task 419OP on or about September 17 and 18, 2019, on\nthe Blackwater Oaks, Crescent Woods, Cypress Trace, Grandview Landings, and\nHighlands in the Woods LP-Gas distribution systems. Contractor 2’s qualification\nrecords showed that he had never been qualified to perform this covered task.\nFPU acknowledged that in 2019 it used contract employees with expired or non-existent\nqualification and further explained that at the time it was transitioning all contractors from\nindividual recordkeeping to storage with its current OQ service provider. Their current\nservice provider “notifies FPU supervisors and managers of expiring and current\nqualifications via reports and e-mails to ensure a qualified workforce.”\n§ 192.1015 What must a small LPG operator do to implement this subpart?\nGeneral. No later than August 2, 2011, a small LPG operator must develop\nand implement an IM program that includes a written IM plan as specified in\nparagraph (b) of this section. The IM program for these pipelines should reflect the\nrelative simplicity of these types of pipelines.\nFPU did not meet the requirements of the regulation because it did not develop and\nimplement an Integrity Management Plan for its Half Moon Station LP-Gas distribution\nsystem prior to the system becoming subject to the Part 192 requirements.\nIn general, for distribution systems placed into service after August 2, 2011, PHMSA\nexpects operators to develop and implement their Integrity Management Plan prior to\nbeginning operation. However, per § 192.1(b)(5), Half Moon Station, with no portion of the\nsystem located in a public place, was not subject to the Part 192 requirements when FPU\nbegan operating the system and did not become subject to the Part 192 requirements until\nthe system started serving 10 or more customers. FPU estimated that it added the 10th\ncustomer to the system sometime between June and December of 2018. Therefore, FPU\nshould have developed and implemented its Integrity Management Plan for the Half Moon\nStation LP-Gas distribution system when it added the 10th customer onto the system.\nFPU acknowledged that it had not developed and implemented its Integrity Management\nPlan for Half Moon Station when it added the 10th customer to the system. After the\ninspector identified this issue, FPU developed and implemented the required plan.\nUnder 49 U.S.C. § 60122 and 49 CFR § 190.223, Florida Public Utilities Company is subject to\na civil penalty not to exceed $239,142 per violation per day the violation persists, up to a\nmaximum of $2,391,142 for a related series of violations. For violation occurring on or after\nMay 3, 2021 and before March 21, 2022, the maximum penalty may not exceed $225,134 per\nviolation 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\n\n\n\nto exceed $2,132,679. For violation occurring on or after November 2, 2015 and before\nNovember 27, 2018, the maximum penalty may not exceed $209,002 per violation per day, with\na maximum penalty not to exceed $2,090,022.\nWe have reviewed the circumstances and supporting documents involved in this case, and have\ndecided not to conduct additional enforcement action or penalty assessment proceedings at this\ntime. We advise you to correct the items identified in this letter. Failure to do so will result in\nFlorida Public Utilities Company 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 2-2022-011-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\nthe redacted information qualifies for confidential treatment under 5 U.S.C. § 552(b).\nSincerely,\nJames A. Urisko\nDirector, Office of Pipeline Safety\nPHMSA Southern Region","truncated":false,"body_characters":18241}