{"operation":"document","citation":"CPF 320065027","title":"AMOCO OIL CO — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2006-03-07","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.412(a), 195.420(a), 195.440.","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-320065027.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-320065027.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-320065027","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/320065027","body":"Notice of Probable Violation involving AMOCO OIL CO. PHMSA's enforcement data identifies the cited regulations as 195.412(a),  195.420(a),  195.440. The case was opened on 2006-03-07 and is reported as closed as of 2007-11-28. Proposed civil penalty: $10,000. Assessed civil penalty: $10,000. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n320065027_FinalOrder_11072007.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320065027/320065027_FinalOrder_11072007.pdf\n\n320065027_finalorder_11072007_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320065027/320065027_finalorder_11072007_text.pdf\n\n320065027_finalorder_11072007_text.pdf\n\nO\nU S Department\nof Transportation\nPipeline and Hazardous\nMaterials Safety\nAdministration\n1200 New Jersey Ave S E\nWashington DC 20590\nNOV 7 2007\nMr, Jim Lamanna\nPresident\nBP Pipelines (North America) Inc.\n28100 Torch Parkway\nWarrenville, Illinois 60555\nRE: CPF No. 3-2006-5027\nDear Mr. Lamanna:\nEnclosed is the Final Order issued by the Associate Administrator for Pipehne Safety in the\nabove-referenced case. It makes findings of violation and assesses a civil penalty of $10, 000.\nThe penalty payment terms are set forth in the Final Order. This enforcement action closes\nautomatically upon payment. Your receipt of the Final Order constitutes service of that\ndocument under 49 C. F. R. $ 190. 5.\nSincerely,\nJames Reynolds\nPipeline Compliance Registry\nOffice of Pipeline Safety\nEnclosure\ncc: Mr. Ivan Huntoon, Director, OPS Central Region\nMr. Rob Knanishu, DOT Team Lead, BP Pipelines N A.\n, Inc,\nCERTIFIED MAIL — RETURN RECEIPT RE UESTED\n\n\n\nDEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D. C. 20590\nIn the Matter of\nBP PIPELINES (North America), Inc.\n,\n)\n)\n)\n)\n)\n) CPF No. 3-2006-5027\nFINAL ORDER\nDuring the weeks of August 15, August 28, and November 28, 2005, a representative of the\nPipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety\n(OPS), Central Region, conducted an on-site safety inspection of Respondent's facilities and\nrecords in Merrillville, Indiana, Sugar Creek, Missouri, and Dubuque, Iowa, pursuant to 49\nU. S. C. $ 60117, As a result of the inspection, the Director, Central Region, OPS, issued to\nRespondent, by letter dated March 7, 2006, a Notice of Probable Violation and Proposed Civil\nPenalty (Notice). In accordance with 49 C. F. R. $ 190. 207, the Notice proposed finding that\nRespondent committed a violation of 49 C. F. R. ) 195. 420(a) and proposed assessing a civil\npenalty of $10, 000 for such alleged violation. The Notice also proposed finding that Respondent\nhad committed certain probable violations of 49 C. F. R. Part 195 and warned Respondent to take\nappropriate corrective action to address them or be subject to future enforcement action.\nRespondent replied to the Notice by letter dated April 10, 2006 (Response). Respondent\ncontested the allegations, offered information in explanation thereof, and requested a hearing.\nThe hearing was held on October 25, 2006, in Kansas City, Missouri, with Renita Bivins,\nEsquire, Office of Chief Counsel, PHMSA, presiding.\nFINDINGS OF VIOLATION\nItem 1 in the Notice alleged that Respondent violated 49 C. F. R. $ 195. 420(a), which provides:\ng 195. 420. Valve maintenance.\n(a) Each operator shall maintain each valve that is\nnecessary for the safe operation of its pipeline systems\nin good working order at all times\n\n\n\nThe Notice stated that during the inspection of the Respondent's Cresco Station, the OPS\ninspector determined that two mainline block valves were inoperable. At the request of the OPS\ninspector, Respondent performed a subsequent investigation that revealed frozen water in the\noperating mechanism of both valves. The \"Stem-0 Rings\" had failed and allowed moisture to\nenter the gear assembly, which subsequently froze.\nIn its Response and at the hearing, Respondent acknowledged that the valves were inoperable at\nthe time of the inspection. However, Respondent asserted that it was in compliance with all\nprocedures and requirements because it had inspected the valves in question prior to the OPS\ninspection, as required by 49 C. F. R. ) 195. 420 and its own Operations and Maintenance Manual\n(OMER). Specifically, Respondent asserted that it had inspected the valves in question on April\n21 and April 28, 2005, and again on November 9 and 15, 2005, In addition, Respondent\ncontended that although the valves were inoperable at the time of the inspection, the line was\ndown and Respondent's maintenance personnel responded to correct the problem within several\nhours. '\nRegardless of the reason for the valve failures, there is no factual dispute that at the time of the\nOPS audit, the valves were not operating properly. Unless a pipeline is abandoned or\ndecommissioned, all valves must operate correctly at all times, including when the line is down.\nThis is necessary because the line may be put back into operation at any point, Respondent\nacknowledged water intrusion at the time of the audit. When valves are frozen, the valves\nthemselves or their components may not operate as intended. Accordingly, I find that\nRespondent violated 49 C. F. R. )195. 420(a) by failing to maintain each valve that is necessary\nfor the safe operation of its pipeline system in good working order at all times. This finding of\nviolation will be considered a prior offense in any subsequent enforcement action taken against\nRespondent.\nASSESSMENT OF PENALTY\nUnder 49 U. S. C. $ 60122, Respondent is subject to a civil penalty not to exceed $100, 000 per\nviolation for each day of the violation up to a maximum of $1, 000, 000 for any related series of\nviolations.\n49 U. S. C. $ 60122 and 49 C. F. R. $ 190. 225 require that, in determining the amount of the civil\npenalty, I consider the following criteria: nature, circumstances, and gravity of the violation;\ndegree of Respondent's culpability; history of Respondent's prior offenses; Respondent's ability\nto pay the penalty; good faith by Respondent in attempting to achieve compliance; the effect on\nRespondent's ability to continue in business; and such other matters as justice may require.\nThe evidence and arguments presented by Respondent in defense of the Notice do not refute the\nallegation of a violation of 95 C. F. R. $ 195. 420. Instead, they are more properly considered as\narguments for mitigating the proposed penalty,\n' Respondent pointed to a number of factors that may have contnbuted to the valve failures, includmg the actions of\nRespondent's contractors and weather conditions. These concerns are more fully discussed in the \"Assessment of\nPenalty\" section below\n\n\n\nFirst, Respondent provided a description of the maintenance history of the valves prior to the\nOPS inspection. On April 12, 2005, the two valves received new stem packing and all the gear\ngrease was cleaned out and re-packed with new grease by Respondent's contractor, Aspen\nEnergy Sales and Service, Inc. (Aspen). The valves were subsequently painted by a painting\ncontractor.\nIn addition, as part of its six-month valve inspection and maintenance procedures, Respondent\ntestified that all valve parts were cleaned, including the removal of some paint on the stem\nindicator by BP's contractor, Maximo. Respondent submitted Maximo's reports as supporting\ndocumentation. Respondent suggested that the paint removal might have caused the seal to fail.\nRespondent contended that the maintenance identified above indicates that all practical steps\nwere taken to ensure safe valve operation.\nSecond, Respondent contended that similar valves on the same line were inspected for\noperational problems and were found to be in good working order. Respondent surmised that\nmoisture acciunulated and compromised the valves in question between the time Aspen serviced\nthe valves and the time of the OPS inspection. Respondent stated that it expected Aspen to\ninspect and change out the gear assembly, if necessary.\nThird, Respondent argued that the temperatures in November 2005 fell below normal and that\nextreme cold weather contributed to the inoperable condition of the valves. Respondent\nsuggested that the frozen valves were a result of the combination of the line being shut down and\nthe below-freezing temperatures, as the warmth of product moving through a pipeline normally\nhelps to prevent freezing.\nAt the hearing, OPS personnel rejected each of these arguments. First, they argued that the\nmanufacturer of these particular valves had identified their potential for freezing roughly 20\nyears ago. In support of its position, OPS submitted documentation from MkJ Valve for the\nInstallation, Operation and Maintenance Manual (MEcJ Manual) for this type of valve, the M303\nk RQ-8 Gate Valve . The manufacturer had even changed the design of the valve because it\nrecognized the need for a winterization feature and had reiterated for its customers the\nimportance of protecting the valve from water and water intrusion. The Mk J Manual, Section 4,\nBody Draining and Flushing, notes:\n\"Water, and occasionally sediment, may accumulate\nin the body of the valve. \"\nThe Manual recommended \"draining the body. . . prior to the onset of winter\" (prior to the onset\nof cold weather). \" It further recommended that if the valve had an old-style rubber grommet\nindicator rod seal, it should be replaced with the new indicator rod sealing device. ' The MAJ\nManual also recommended a specific seat lubrication grease if the \".\n. . gear operated valves\n' Maximo inspection reports ¹301210 and ¹301211 for valves ¹4630 and ¹5443 respectively, dated 4-12-05\n' M&J Valve, An SPX Process Equipment Operation, M303 & RQ-8 Gate Valve. Installation, Operation and\nMaintenance Manual, MJ-1791 issued August 2005 [hereafter M&J Manual]\nM& J Manual, III. Operation, Section 4, Body Draimng and Flushing, p 6\n' M& J Manual, IV. Periodic Maintenance, Section I, Lubrication (1 1 I), p 8.\n\n\n\nbecome hard to cycle in cold temperatures due to stiff grease. . .\n\" The Manual also provided\nnotice of the availability of a new seal kit or indicator rod assembly to prevent cold-weather\nproblems.\nSecond, OPS pointed out those below-freezing temperatures are common in Iowa and that\nappropriate maintenance of the valve should have been considered and implemented by\nRespondent. I agree that it is the Respondent's responsibility to be aware of manufacturers'\nwarnings, recalls, and recommendations in the maintenance and operation of its facilities.\nDining the inspection, both valves were found frozen in the open position. Respondent should\nhave known of the valves' winterization needs and should have been proactive in checking these\nvalves.\nOPS personnel also challenged Respondent's assertion that it was in compliance with all\nregulatory procedures and requirements because the valves in question had been inspected prior\nto the OPS inspection, per 49 C. F. R. $ 195. 420 and the procedures contained in the OMER. OPS\npointed out that a properly trained individual can determine from the color of the grease whether\nthere is moisture present. OPS questioned whether Respondent looked at the bevel gear grease in\nall of the valves before or after the OPS inspection. The two valves in question were above\nground and elevated on blocks and the line was down at the time, a situation that would have\nprovided a \"golden opportunity\" for Respondent to inspect the valves.\nRespondent acknowledged that it did not check the bevel gear grease in all of the valves.\nHowever, Respondent advised that after the OPS inspection, it did verify that the other valves\nwere operational,\nRespondent further advised that it will check the conversion kits and seal indicators during its\nplanned scheduled maintenance in the 2007 season.\nRespondent stated that it first learned of the bulletin or M&J Manual when problems arose with\nthe valve. Respondent advised that there were no previous indications of problems operating the\ngear and that MkJ never notified Respondent directly of cold-weather problems with the valve.\nThe Notice proposed a total civil penalty of $10, 000 for violation of $195. 420(a), as Respondent\nfailed to maintain each valve that is necessary for the safe operation of its pipeline system in\ngood working order at all times. As noted above, two of Respondent's mainline block valves at\nits Cresco Station were found to be inoperable at the time of the audit, with frozen water found in\nthe operating mechanism of both valves. For various reasons, Respondent has argued that the\npenalty should be eliminated or mitigated.\nThe regulation, however, is clear. A pipeline operator must maintain each of its valves that are\nnecessary for the safe operation of its pipeline system in good working order at all times, The\nregulation does not distinguish between when the line is operational or down nor does it provide\nallowances for weather conditions. Pipelines must operate in all sorts of weather conditions,\nmany of them extreme, In this case, the manufacturer of the valve had indicated the need to\nprotect the valve for winterization and from water or water intrusion.\n4\n\n\n\nThe primary objective of the Federal pipeline safety standards is safe operation of pipeline\nsystems. Failure to properly maintain the pipeline or to find and correct deficiencies could\nadversely affect public safety. Timely inspection, testing, and maintenance of mainline valves is\nan important part of pipeline safety because their proper operation can be critical in responding\nto failure incidents and mitigating releases that could threaten the public, property, or the\nenvironment. Accordingly, having reviewed the record and considered the assessment criteria, I\nhereby assess Respondent a total civil penalty of $10, 000.\nPayment of the civil penalty must be made within 20 days of service. Payment may be made by\nsending a certified check or money order (containing the CPF Number for this case) payable to\n\"U. S. Department of Transportation\" to the Federal Aviation Administration, Mike Monroney\nAeronautical Center, Financial Operations Division (AMZ-300), P. O. Box 25082, Oklahoma\nCity, OK 73125.\nFederal regulations (49 C. F. R. $ 89. 21(b)(3)) also permit this payment to be made by wire\ntransfer, through the Federal Reserve Communications System (Fedwire), to the account of the\nU, S. Treasury. Detailed instructions are contained in the enclosure. Questions concerning wire\ntransfers should be directed to: Financial Operations Division (AMZ-341), Federal Aviation\nAdministration, Mike Monroney Aeronautical Center, P. O. Box 25082, Oklahoma City, OK\n73125; (405) 954-8893.\nFailure to pay the $10, 000 civil penalty will result in accrual of interest at the current annual rate\nin accordance with 31 U. S. C. $ 3717, 31 C. F, R. $ 901. 9 and 49 C. F. R, $ 89. 23.\nPursuant to those same authorities, a late penalty charge of six percent (6 10) per annum will be\ncharged if payment is not made within 110 days of service. Furthermore, failure to pay the civil\npenalty may result in referral of the matter to the Attorney General for appropriate action in a\nUnited States District Court.\nWARNING ITEMS\nThe Notice did not propose a civil penalty or compliance action for Items 2 and 3 in the Notice;\ntherefore, these are considered warning items. The warnings were for the following:\n49 C, F. R. $ 195. 412 - failing to patrol Respondent's Sugar Creek-Burlington\nJunction, Burlington Junction-Des Moines, and Burlington Junction-Council\nBluffs sections of pipeline at intervals not exceeding 3 weeks, but at least 26\ntimes each calendar year.\n49 C. F. R. $ 195. 440 - failing to adequately notify and educate all members of\nthe public living along Cascade Drive and Monticello Drive in Dubuque, IA, on\nhow to recognize a hazardous liquid or a carbon dioxide pipeline emergency.\n\n\n\nRespondent presented information in its Response showing that it had taken certain actions to\naddress the cited items. Having considered such information, I find, pursuant to 49 C. F. R. $\n190. 205, that probable violations of 49 C. F. R. $ 195. 412 (Notice Item 2) and 49 C. F. R. $\n195, 440 (Notice Item 3) have occurred. Respondent is hereby advised to correct such conditions.\nIn the event that OPS fine a violation of either of these items in a subsequent inspection,\nRespondent may be subject to future enforcement action.\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 received within 20 days of Respondent's receipt of this\nFinal Order and must contain a brief statement of the issue(s). The filing of a petition\nautomatically stays the payment of any civil penalty assessed. However, if Respondent submits\npayment for the civil penalty, the Final Order becomes the final administrative decision and the\nright to petition for reconsideration is waived. The terms and conditions of this Final Order are\neffective on receipt.\nHOV 7 2007\neffr\nsso\npi\nD. Wiese\nate Administrator\neline Safety\nDate Issued","truncated":false,"body_characters":17102}