EQUISTAR CHEMICALS, L.P. — Notice of Probable Violation

case documentOfficial PDF320025012.pdf#

320025012_Final Order_11252003.pdf, page 1Official PDF?} U.S.Deportrnent of Tronsportotion Reseorchond Speciol Progroms Administrotion 400 Sevenlh St.. S.W Washinglon, D C 20590 NOV 2 5 'r. ', Dan F. Smith President & CEO Equistar Chemicals, LP P.O. Box 3646 Houston, TX 77253-3646 Re: CPF No. 3-2002-5012 Dear Mr. Smith: Enclosed is the Final Order issued bythe Associate Administrator for Pipeline Safety in the above-referenced case. It makes a finding of violation, assesses a civil penalty of $5,000, and requires that you amend your integrity management program procedures. When the civil penalty is paid and the amendment of procedures completed, as determined by the Director, Central Region, this enforcement action will be closed. The penaltypayment terms are set forth in the Final Order. Your receipt of the Final Order constitutes service of that document under 49 C.F.R. $ 190.5. Sincerely, \ ,/L {"t Gwendolvn M. Hill Pipeline Compliance RegistrY Of{ice of Pipeline Safety Enclosure CERTIFIED MAIL - RETURN RECEIPT REOUESTED#

320025012_Final Order_11252003.pdf, page 2DEPARTMENT OF TRANSPORTATION RESEARCH AND SPECIAL PROGRAMS ADMINISTRATION OFFICE OF PIPELINE SAFETY WASHINGTON. DC 20590 In the Matter of Equistar Chemicals, LP Respondent. CPF No. 3-2002-5012 FINAL ORDER On March 27-28,z\O2,pursuant to 49 U.S.C. $ 60117, representatives of the Office of Pipeline Safety (OPS), conducted a segment identification and completeness inspection of Respondent's IntegntyManagement Program @yIP) in Alvin, Texas. As a result of the inspection, the Director, Central Region, OPS, issued to Respondent, by letter dated June 3, 2002, a Notice of Probable Violation, Proposed Civil Penalty, and Notice of Amendment (Notice). In accordance with 49 C.F.R. 5190.207, the Notice proposed finding that Respondent had violated 49 C'F.R. $ 195.452(b)(2) and proposed assessing a civil penalty of $5,000 for the alleged violation. The Notice also proposed, in accordance with 49 C.F.R. S 190.237, that Respondent amend its IMP procedures for identiffing pipeline segments that could affect high consequence areas (HCAs). Respondent responded to the Notice by letter dat edJwe24,2002 (Response). Respondent contested the allegation, offered information to explain the allegation, and requested that the proposed civil penalty be reduced or eliminated. Respondent did not request a hearing, and therefore has waived its right to one. FINDING OF VIOLATION Item I in the Notice alleged that Respondent had violated 49 C.F.R. $ 195.452(bX2) by failing to identiff all pipeline segments that could affect a high consequence area (HCA) by Decembet 31, ZO0l. At the time of the December 31,2001deadline, Respondent had identified "could affect" segments using its internal system maps and local knowledge ofHCAs. Although National Pipeline Mapping System (I.1PMS) data and multiple extemal sources were available to identify and verify HCR aaia for Louisiana and Texas-the states in which Respondent's line operates-Respondent did not employ any of these sources to identify "could affect" segments.#

320025012_Final Order_11252003.pdf, page 32 As of December 31, 2001, Respondent had identified approximately 725 miles of "could affect" segments. Subsequent to December 3 1, 2001 , Respondent began identifying "could affect" segments using contractor-prepared system overTay maps that were based on NPMS data and U.S. Geological Survey quadrant maps. Utilizing the new system overlay maps based on extemal data sources subsequent to the deadline yielded a significant increase in "could affect" segments identified. At the time ofinspection, approximatelythree months afterthe deadline, Respondent had identified 858 miles of"could affect" segments. OPS inspectors determinedthatthe 15 percent differencebetween miles identified before the deadline and at the time of inspection was due primarilyto Respondent's failure to account for drinking water areas and at least one populated area. In its Response, Respondent argued that "no significant omission waranting punitive measures was made." Respondent attribute the 15 percent increase in "could affect" segment mileage identified to error or omission and program refinement. Respondent noted that $ 195.452 requirements are o'evergreen" and procedures developed thereunder are "always subject to continual improvement processes." While integrity management is a constantly evolving process, the "could affect" segment identificationprocesswas anecessaryelementuponwhichall futureintegritymanagementprocesses were to be based, thus requiring an absolute deadline. Respondent chose to relyup intemal data, and did not consult available outside data sources, such as NPMS data, as suggested by Appendix C to Part 195. As a result, drinking water areas and at least one populated area were unaccounted for in Respondent's segment identificationprocess as ofthe December 31, 2001 deadline. These areas are explicitly defined as HCAs in Part 195 and Respondent was fully apprised of its responsibility for identiffing segments of pipeline that could affect them byDecember 3L,2001. Accordingly, I find that Respondent violated 49 C.F.R. $ 195.452(b)(2)bV failing to identify all pipeline segments that could affect a high consequence area (HCA) by December 31, 2001. This finding of violation will be considered a prior offense in any subsequent enforcement action taken against Respondent. ASSESSMENT OF PENALTY Under 49 U.S.C. S 60122, Respondent is subject to a civil penalty not to exceed $100,000 per violation for each day of the violation up to a maximum of $1,000,000 for any related series of violations. 49 U.S.C. 5 60122 and 49 C.F.R. S 190.225 require that, in determining the amount of the civil penalty, I consider the following criteria: nature, circumstances, and gravity of the violation, degree ofRespondent's culpability, history of Respondent's prior offenses, Respondent's ability to pay the penalty, good faith by Respondent in attempting to achieve compliance, the effect on Respondent's ability to continue in business, and such other matters as justice may require' The Notice proposed a total civil penalty of $5,000 for violation of 49 C.F'R. $ 195.452(bX2)'#

320025012_Final Order_11252003.pdf, page 43 The integrity management rules are intended to address risks in areas where the consequences of a pipeline ielease are the greatest. These areas include populated areas and the most environmentally sensitive areas. The first step in the integrity management process is the identification of these critical areas. Respondent's failure to identiff "could affect" segments by the December 31,2001 deadline is primarily attributable to Respondent's failure to consult readily available outside data sources. NPMS and other outside data for the states in which Respondent's pipeline operates was available before the December 3l ,z}}Ldeadline for Respondent to identify the segments it missed. Respondent did not make a good faith effort to comply with the segment identification requirements of $ tqS.+52@)(2). The proposed penalty will not affect Respondent's ability to continue in business. Accordingly, havingreviewedtherecord andconsideredthe assessment criteria,I assess Respondent a total civil penalty of $5,000. payment of the civil penalty must be made within 20 days of service. Payment may be made by ,rodirrg a certified check or money order (containing the CPF Number for this case) payable to "U. S. DepanmentofTransportation" tolheFederalAviationAdministration,MikeMonroneyAeronautical Center, Financial Oierations Division (ANIZ-120), P.O. 8ox25082, Oklahoma City, OK 73125' Federal regulations (4g c.F.R. $ sg.21(bx3)) also permit this payment to be made bywire transfer, through the Federal Reserve Communications System (Fedwire), to the account ofthe U.S. Treasury. Detailed instructions are contained in the enclosure. Questions conceming wire transfers should be directed to: Financial Operations Division (ANIZ-120), Federal Aviation Administration, Mike Monroney Aeronautical Center, P.O. Box 25770, Oklahoma City, OK 73L25; (405) 954-4719' Failure to pay the $5,000 civil penalty will result in accrual of interest at the current annual rate in accordancewith3l u.s.c. g3i17,31 c.F.R. $ 901.9 and49c.F.R. $ s9.23. Pursuanttothosesame authorities, alatepenalty rhutg" of six percent (6%) per annum will be charged if payment is not made within 110 days of service. Furthermore, failure to pay the civil penalty mayresult in referral of the matter to the Attorney General for appropriate action in a United States District Court' AMENDMENT OF PROCEDURES The Notice alleged inadequacies in Respondent's integrity management program and proposed to require amendrnent of Respondent's procedures to comply with the requirements of 49 C'F'R' $$ 195.452(bxz) and tgi.qs2&X6i(ii). Respondent did not contest the proposed Notice of Amendment and proposed a plan'of action to revise its procedures. Accordingly, I find that Respondent's procedures werelnadequate to ensure safe operation of its pipeline system' Pursuant to 49 U.S.C. $ 60108(a) and 49 C.F.R. S Ig0.237,Respondent is ordered to make the following revisions to its procedures' Respondent must - 1. Provide fully-detailed process documentation for identifyrng segments that could affect HCAs (beyond a rudimentary list of data sources)'#

320025012_Final Order_11252003.pdf, page 54 2. Provide adequate technical justification for using the selected buffer zone and account for transport mechanisms for identiffing segments that could affect high consequence areas. 3. Consider in its technical justification that non-commercial navigable waterways, such as streams, may act as transport paths for releases of highly volatile liquids to a high consequence atea. 4. Consider the properties of highly volatile liquids (HVL) and carbon dioxide, the impact of weather conditions, topography, and the impacts these factors could have on human and animal life around the pipeline system. 5. Submit the amended procedures to the Regional Director, Central Region, OPS within 30 days following receipt of this Final Order. 6. The Regional Director may extend the period for complying with the required items if the Respondent requests an extension and adequately justifies the reasons for the extension. Failure to comply with this Amendment 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. Under 49 C.F.R. $ 190.215, Respondent has a right to submit a Petition for Reconsideration of this Final Order. The petition must be received within 20 days of Respondent's receipt of this Final Order and must contain abrief statement ofthe issues. The filing ofthe petition automatically stays the payment of any civil penalty assessed. However, if Respondent submits payment for the civil penalty, the Final Order becomes the final administrative decision and the right to petition for reconsideration is waived. The terms and conditions of this Final Order are effective on receipt. Gerard for Pipeline Safety Date Issued#