VECTREN ENERGY DELIVERY OF OHIO — Warning Letter

320085003w_warning letter_03192008_text.pdf, page 1Official PDFu 5 Department of Transportation Pipeline and Hazardous Matenats Safety Administration 901 Locust Street, Suite 462 Kansas City, MO 64106-264t WARNING LETTER CERTIFIED MAIL - RETURN RECEIPT RE UESTED March 19, 2008 Mr Rick Schach Vice President Vectren Energy Delivery 211 NW Riverside Dave Evansville, IN 47711 CPF 3-2008-5003W Dear Mr Schach On January 29, through February 2, 2007, representatives of the Pipehne and Hazardous Matenals Safety Administration (PHMSA) Central Region and the Ohio Pubhc Utihties Commission pursuant to Chapter 601 of 49 United States Code inspected your propane pipelines in Ohio As a result of the inspection, it appears that you have committed probable violations of the Pipeline Safety Regulations, Title 49, Code of Federal Regulations The items inspected and the probable violations are t'1192. 707 Line markers for mains and transmission lines. (d) Marker warning. The followmg must be written legibly on a background of sharply contrasting color on each line marker (1) The word "Warning, " uCautton, " or "Danger" followed by the words uGas (or name of gas transported) Pipeline".#

320085003w_warning letter_03192008_text.pdf, page 2Vectren does not adequately identify the contents of the pipehne during the time natural gas is in the pipehne Vectren's pipehne transports propane during the winter heating season However, during the other seasons, Vectren stores natural gas in the pipeline and monitors pressure Vectren's current hne markers do not indicate that natural gas is in the hne, nor do they change the line markers when the product changes As it stands now, the hne markers indicate that there is propane in the pipeline all year long I'I195. 440 Public education. [Amdt. 195-15; Docket PS-51] Each carrier shall establish a continuing educational program to enable the public, appropriate government organizations, and persons engaged in excavation related activities to recognize a liquid pipeline emergency and to report it to the carrier or the fire, pohce, or other appropriate public officials During 2004 and 2005, Vectren did not provide a continuing education program specific to propane for the pubhc in the vicimty of the propane pipehue Vectren sent natural gas public education mailers to the affected pubhc during that time period In 2006, Vectren sent a pubhc education mailer that was specific to propane At the time of the inspection, your personnel agreed to send an additional mailer to the pubhc in the vicinity of the right of way as a reminder to mcrease awareness on the properties of propane II195. 589 What corrosion control information do I have to maintain? (c) You must maintain a record of each analysis, check, demonstration, examination, inspection, investigation, review, survey, and test required by this subpart in sufficient detad to demonstrate the adequacy of corrosion control measures or that corrosion requiring control measures does not exist. Vectren did not adequately document in sufficient detail the adequacy of corrosion control measures or that corrosion reqinring control measures does not exist on their propane pipehne Vectren utihzes a single check mark on a leak survey form to document that an atmospheric inspection has been completed on their propane pipehne from Todhunter to Bellbrook This form of documentation does not indicate that each specific area such as valves exposed to the atmosphere, above ground piping, soil-to- air interfaces, under thermal insulation, under disbonded coatings and at pipe supports have been inspected#

320085003w_warning letter_03192008_text.pdf, page 3Under 49 Umted States Code, t) 60122, you are sublect to a civil penalty not to exceed $100, 000 for each violation for each day the violation persists up to a maximum of $1, 000, 000 for any related senes of violations We have reviewed the circumstances and supporting documents involved in this case, and have decided not to conduct additional enforcement action or penalty assessment proceedings at tlus time We advise you to correct the item(s) identified in this letter Failure to do so will result in Vectren Energy Dehvery being sub)ect to additional enforcement action No reply to tlus letter is required If you choose to reply, in your correspondence please refer to CPF 3-2008-5003W. Be advised that all matenal you submit in response to this enforcement action is sub)ect to bemg made pubhcly available If you beheve that any portion of your responsive material quahfies for confidential treatment under 5 U S C 552(b), along with the complete original document you must provide a second copy of the document with the portions you believe quahfy for confidential treatment redacted and an explanation of why you beheve the redacted information quahfies for confidential treatment under 5 U S C 552(b) Sincerely, Ivan A Huntoon Director, Central Region Pipeline and Hazardous Matenals Safety Administration#