EXPLORER PIPELINE CO — Notice of Probable Violation

case documentOfficial PDFCPF_NO_3-2004-5010.pdf#

320045010_final order_01092007_text.pdf, page 1Official PDFO U 5 Department of Transportation Pipeline and Hazardous Materials Safety Admmistration 400 Seventh Street, S W Washington, D C 20590 Mr Ron Sands Vice President Explorer Pipelme Company 6846 S Canton Avenue, Suite 300 Tulsa, OK 74136 Re CPF No 3-2004-5010 Dear Mr Sands Enclosed is the Final Order issued by the Acting Associate Administrator for Pipehne Safety in the above-referenced case It withdraws one of the allegations of violation, makes findings of violation, and assesses a civil penalty of $42, 750 The penalty payment terms are set forth in the Final Order This enforcement action closes automatically upon payment Your receipt of the Final Order constitutes service of that document under 49 C F R tJ 190 5 Sincerely, James Reynolds Pipeline Compliance Registry Office of Pipehne Safety Enclosure cc Ivan Huntoon Director, Central Region, OPS CERTIFIED MAIL - RETURN RECEIPT RE UESTED#

320045010_final order_01092007_text.pdf, page 2DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY WASHINGTON, D, C. 20590 In the Matter of ) Explorer Pipeline Company, ) ) ) Respondent. ) CPF No. 3-2004-5010 FINAL ORDER On June 25-29 and July 9-13, 2001, pursuant to 49 U S C IJ 60117, a representative of the Pipehne and Hazardous Matenals Safety Administration, Office of Pipehne Safety (OPS) conducted an on-site pipehne safety inspection of Respondent's facilities and records in the Glenpool, Wood River, and Hammond operating areas located in Missouri, Ilhnois, and Indiana As a result of the mspection, the Director, Central Region, OPS, issued to Respondent, by letter dated Apnl 5, 2004, a Notice of Probable Violation and Proposed Civil Penalty (Notice) In accordance with 49 C F R IJ 190 207, the Notice proposed findmg that Respondent had committed violations of 49 C F R Part 195, and proposed assessing a civil penalty of $45, 750 for the alleged violations Respondent responded to the Notice by letter dated May 7, 2004 (Response) Respondent did not contest two of the allegations of violation (Notice Items I and 3) but provided information concerning the corrective actions it has taken Respondent dtd contest one allegation (Item 2) and provided information m support of its position Respondent did not request a hearing, and therefore has waived its right to one FINDINGS OF VIOLATION In its response, Respondent did not contest two of the alleged violations in the Notice Accordingly, I find that Respondent violated the following sections of 49 C F R Part 195, as more fully described in the Notice 49 C F R fJ 195 401(b) (Item I) — fathng to correct low pipe-to-soil cathodic protection readings at the specified locations withm a reasonable time, 49 C F R fJ 195 406(b) (Item 3) — fading to ensure that actual operating pressure did not exceed 110 percent of the estabhshed maximum operating pressure at the East St Louis Station on tv o specified dates#

320045010_final order_01092007_text.pdf, page 3These findings of violation will be considered pnor offenses in any subsequent enforcement action taken against Respondent WITHDRAWAL OF ALLEGATION Item 2 in the Notice alleged that ResPondent had violated 49 C F R IJ 195 404(b)(1) by faihng to maintain dtuly operating records of the discharge pressure at the Decatur Pump Station for the months of January, November, and December 2000 In its response, Respondent submitted information demonstrating that it did maintain these records Based on this information demonsuattng comphance with the regulation, I am withdrawing this allegation of violation ASSESSMENT OF PENALTY Under 49 U S C IJ 60122 (2001), Respondent is subJect to a civil penalty not to exceed $25, 000 per violation for each day of the violation up to a maximum of $500, 000 for any related series of violations i 49 U S C $ 60122 and 49 C F R IJ 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 of Respondent's culpabtltty, history of Respondent's pnor offenses, Respondent's ability to pay the penalty, good fmth by Respondent in attempting to achieve comphance, the effect on Respondent's ability to continue in business, and such other matters as Justice may require With respect to Item I, the Notice proposed that Respondent be assessed a civil penalty of $2, 750 for violating IJ 195 401(b) by faihng to correct low pipe-to-soil cathodic protection readings at the specified locations withtn a reasonable time The pipehne safety regulations require pipehne operators to conduct tests to determine the adequacy of cathodic protection on an annual basis and to correct any condition it discovers that could adversely affect the safe operauon of its pipehne within a reasonable time meanmg, in this case, before the next annual inspection In its response, Respondent brtefly descnbed the corrective measures it had taken after the OPS inspection to address the cathodtc protection issues in the specified areas Respondent, however, presented no information that would warrant a reductton in the penalty amount proposed in the Notice for this item Accordingly, having reviewed the record and considered the assessment cntena, I assess Respondent a civil penalty of $2, 750 for this violation With respect to Item 3, the Notice proposed that Respondent be assessed a civil penalty of $40, 000 for violatmg II 195 406(b) by faihng to ensure that actual operating pressure did not exceed 110 percent of the established maximum operatmg pressure (MOP) at the East St Louis The Pipehne Safety Improvement Act of 2002 (Pub L bio 107-355, 116 Stat 2992) increased the maximum civil penalty hability to $100, 000 per violation for each day of the violation and $1, 000, 000 for any related senes of violations However because the violations were discovered poor to December 17, 2002, the effective date of the Act, Respondent is not sublect to the higher maximums m this case#

320045010_final order_01092007_text.pdf, page 4Station on two specified dates Preventing pressure surges from exceeding 110 percent of MOP is cntical to the safe operation of a pipehne because such surges can adversely impact the integrity of the pipe In this case, the station facility is located near the Mississippi River which is a commercially navigable waterway and is considered to be a high consequence area In its response, Respondent indicated that it had taken corrective action including installation of a pressure rehef system after receiving the Notice (rom OPS We acknowledge that Respondent has now taken measures that will better control the operating pressure and prevent excessive surges Respondent, however, presented no information that would warrant a reduction in the penalty amount proposed in the Notice for this item Accordingly, having reviewed the record and considered the assessment criteria, I assess Respondent a civil penalty of $40, 000 for this violation Accordingly, having reviewed the record and considered the assessment cnterta, I assess Respondent a total civil penalty of $42, 750 Payment of the civil penalty must be made within 20 days of service Federal regulations (49 C F R $ 89 21(b)(3)) require this payment be made by wire transfer, through the Federal Reserve Communications System (Fedwire), to the account of the U S Treasury Detailed instructions are contained in the enclosure Questions concermng wire transfers should be directed to Financial Operations Division (AMZ-120), Federal Aviation Administration, Mike Monroney Aeronautical Center, P 0 Box 25082, Oklahoma City, OK 73125, (405) 954-4719 Failure to pay the $42, 750 civil penalty will result m accrual of interest at the current annual rate inaccordance with 31 U S C I'1 3717, 31 C FR I'1 901 9 and49 CF R g 8923 Pursuant to those same authorities, a late penalty charge of six percent (6%) per annum will be charged if payment is not made within 110 days of service Furthermore, fadure to pay the civil penalty may result in referral of the matter to the Attorney General for appropriate action in a United States District Court WARNING ITEM The Notice did not propose a civil penalty or corrective action for Item I A in the Notice — fadure to address items discovered during the annual inspections conducted at the Hammond tank farm in 1999 and 2000 Therefore, this is considered to be a warmng item Respondent is warned that if it does not take appropriate action to correct this item, enforcement action will be taken if a subsequent inspection reveals a violation#

320045010_final order_01092007_text.pdf, page 5Under 49 C F R $ 190 215, Respondent has a right to submit a petition for reconsideration of this Final Order Should Respondent elect to do so, the petition must be received within 20 days of Respondent's receipt of this Final Order and must contain a bnef statement of the issue(s) The fihng of a 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 nght to petition for reconsideration is wiuved The terms and conditions of this Fmal Order are effective on receipt he dore L Wtllke cti Associate Administrator fo pehne Safety Date Issued#