# JAYHAWK PIPELINE LLC — Notice of Probable Violation

- **operation:** document
- **citation:** CPF 320135011
- **title:** JAYHAWK PIPELINE LLC — Notice of Probable Violation
- **source type:** enforcement
- **agency:** Pipeline and Hazardous Materials Safety Administration
- **status:** historical
- **official:** true
- **published on:** 2013-04-05
- **effective on:** Not available
- **summary:** CLOSED notice of probable violation citing 195.452(i)(3), 195.452(i)(4), 195.452(j)(2), 195.452(l)(1)(ii).
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- **markdown:** https://regulus.evalyn.ai/document/phmsa-enforcement-320135011.md
- **app url:** https://regulus.evalyn.ai/document/phmsa-enforcement-320135011
- **source url:** https://primis.phmsa.dot.gov/enforcement-data/case/320135011
**body:**

Notice of Probable Violation involving JAYHAWK PIPELINE LLC. PHMSA's enforcement data identifies the cited regulations as 195.452(i)(3),  195.452(i)(4),  195.452(j)(2),  195.452(l)(1)(ii). The case was opened on 2013-04-05 and is reported as closed as of 2014-03-18. Proposed civil penalty: $82,400. Assessed civil penalty: $82,400. Open the official case record for notices, responses, orders, and the latest status.

Official case documents:

320135011_Closure_03182014.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320135011/320135011_Closure_03182014.pdf

320135011_Closure_03182014_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320135011/320135011_Closure_03182014_text.pdf

320135011_Final Order_06282013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320135011/320135011_Final%20Order_06282013.pdf

320135011_Final Order_06282013_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320135011/320135011_Final%20Order_06282013_text.pdf

320135011_NOPV PCP PCO_04052013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320135011/320135011_NOPV%20PCP%20PCO_04052013.pdf

320135011_NOPV PCP PCO_04052013_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320135011/320135011_NOPV%20PCP%20PCO_04052013_text.pdf

320135011_Operator Response_05032013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320135011/320135011_Operator%20Response_05032013.pdf

320135011_Closure_03182014_text.pdf

CERTIFIED MAIL - RETURN RECEIPT REQUESTED
March 18, 2014
Mr. James S. Loving
President
National Cooperative Refinery Association
Jayhawk Pipeline LLC
Kaw Pipe Line Company
2000 South Main Street
McPherson, Kansas 67460
CPF 3-2013-5011
Dear Mr. Loving:
On June 28, 2013, the Pipeline and Hazardous Materials Safety Administration (PHMSA)
issued to National Cooperative Refinery Association, Jayhawk Pipeline, L.L.C., and Kaw
Pipe Line Company a Final Order in the above-referenced case. This Order included a
Compliance Order and Civil Penalty assessment. Based on our review of the
documentation you provided and confirmation of payment of the civil penalty, it has been
determined that you have complied with the terms of this Order.
Accordingly, this case is now closed and no further action is contemplated with respect to
the matters involved in this case. Thank you for your cooperation in this matter.
Sincerely,
Linda Daugherty
Director, Central Region
Pipeline and Hazardous Materials Safety Administration
cc: Mr. Richard S. Petersen, Vice President, Transportation,
National Cooperative Refinery Association

320135011_NOPV PCP PCO_04052013_text.pdf

NOTICE OF PROBABLE VIOLATION
PROPOSED CIVIL PENALTY
and
PROPOSED COMPLIANCE ORDER
CERTIFIED MAIL - RETURN RECEIPT REQUESTED
April 5, 2013
Mr. Rick Petersen
President
Jayhawk Pipeline
1391 Iron Horse Road
McPherson, KS 67460
CPF 3-2013-5011
Dear Mr. Petersen:
On December 5-8, 2011, representatives of the Pipeline and Hazardous Materials Safety
Administration (PHMSA) pursuant to Chapter 601 of 49 United States Code conducted an
inspection of your Integrity Management Program (IMP) and procedures at your facilities in
McPherson, KS.
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 violation(s) are:
1. §195.452 Pipeline integrity management in high consequence areas.
(j) What is a continual process of evaluation and assessment to maintain a pipeline's
integrity?
(2) Evaluation. An operator must conduct a periodic evaluation as frequently as
needed to assure pipeline integrity. An operator must base the frequency of



evaluation on risk factors specific to its pipeline, including the factors specified in
paragraph (e) of this section. The evaluation must consider the results of the baseline
and periodic integrity assessments, information analysis (paragraph (g) of this
section), and decisions about remediation, and preventive and mitigative actions
(paragraphs (h) and (i) of this section).
Jayhawk did not follow their process for conducting periodic evaluation of pipeline
integrity, including review of integrity assessment results and information analysis for five
(5) of their liquid pipeline segments.
Jayhawk uses the form “Individual Line Review Form” to integrate all assessment
information. However, five (5) individual line segments were missing the assessment
evaluation form. The five (5) line segments that did not have the review form are as
follows:
Jayhawk Meade to Chase
Jayhawk Valley Center to McPherson
NCRA Conway 8” Gas
NCRA Conway 8” Nat Gasoline
NCRA Conway 6” Pentane
2. §195.452 Pipeline integrity management in high consequence areas.
(i) What preventive and mitigative measures must an operator take to protect the
high consequence area?
(3) Leak detection. An operator must have a means to detect leaks on its pipeline
system. An operator must evaluate the capability of its leak detection means and
modify, as necessary, to protect the high consequence area. An operator's evaluation
must, at least, consider, the following factors–length and size of the pipeline, type of
product carried, the pipeline's proximity to the high consequence area, the swiftness
of leak detection, location of nearest response personnel, leak history, and risk
assessment results.
Jayhawk/NCRA did not perform a leak detection capability evaluation on any of the
Jayhawk, KAW, or NCRA systems. An evaluation is required to determine the leak
detection system capability, and if modifications are necessary. This was identified in the
last IMP inspection.
3. §195.452 Pipeline integrity management in high consequence areas.
(i) What preventive and mitigative measures must an operator take to protect the
2



high consequence area?
(4) Emergency Flow Restricting Devices (EFRD). If an operator determines that an
EFRD is needed on a pipeline segment to protect a high consequence area in the
event of a hazardous liquid pipeline release, an operator must install the EFRD.
In making this determination, an operator must, at least, consider the following
factors–the swiftness of leak detection and pipeline shutdown capabilities, the
type of commodity carried, the rate of potential leakage, the volume that can be
released, topography or pipeline profile, the potential for ignition, proximity to
power sources, location of nearest response personnel, specific terrain between
the pipeline segment and the high consequence area, and benefits expected by
reducing the spill size.
Jayhawk did not conduct an EFRD analysis of the KAW pipeline system.
The KAW system and the El Dorado to Halstead line were brought into the IMP program
in 2009 subsequent to the last PHMSA IMP inspection. The El Dorado to Halstead
segment was evaluated and results concluded that no EFRDs were needed. However, the
KAW system was overlooked and was not evaluated.
4. §195.452 Pipeline integrity management in high consequence areas.
(l) What records must be kept?
(1) An operator must maintain for review during an inspection:
(ii) Documents to support the decisions and analyses, including any modifications,
justifications, variances, deviations and determinations made, and actions taken, to
implement and evaluate each element of the integrity management program listed in
paragraph (f) of this section.
Jayhawk did not keep records or properly fill out the forms per their IMP Plan for multiple
IMP processes. The following deficient or missing records were noted:
a) Jayhawk had insufficient records showing that new HCA’s were identified and
confirmed since 2006. Jayhawk’s process for identifying newly Identified HCA’s
clearly require that this review be documented. Review of the Jayhawk’s Annual
Integrity Management Review records which is used to document the HCA review
was last completed in 2006. Jayhawk personnel were able to provide internal email
correspondence showing that the company was actively trying to identify new HCA’s
through the use of NPMS from 2010 to present; however, this is not consistent with
the record keeping process.
3



b) c) d) e) f) g) h) Records were not available that documented the Communication of Evaluation for
2010. Jayhawk documents the Communication of Evaluation meetings through sign-
up sheets at their annual IMP committee meeting. However, the sign-up sheet and
agenda for the 2010 meeting was missing.
Records that indicated that a baseline assessment was done on the KAW system were
not available. Jayhawk utilizes a Pipe Summary Assessment E Form to evaluate and
document what baseline assessment is going to be performed. No record of that form
could be found that showed that the assessment was conducted on the KAW system.
Jayhawk could not produce any record that showed that a continual assessment and
evaluation was conducted on the NCRA system. They could not find a completed
record for the NCRA system for 2008 and 2009.
Jayhawk could not produce any records showing that an analysis was conducted to
determine the reassessment interval. Jayhawk/NCRA personnel indicated that the
analysis was documented on the Mitigation Information Analysis, and Reassessment
Interval Review documentation. However, the documentation presented to PHMSA
during the inspection found that the forms were not filled out for the NCRA, KAW,
and Jayhawk systems.
Jayhawk did not have records of any effectiveness reviews for the NCRA system.
Jayhawk personnel conduct annual reviews to determine the effectiveness of the IMP
program. Jayhawk personnel document the reviews through typed agendas and their
IMP Audit and Industry Benchmarking forms. No forms could be produced to show
that the NCRA system was evaluated during these meetings.
Jayhawk did not have records of any evaluation of performance measures for either the
NCRA or Jayhawk systems. Jayhawk personnel indicated that the performance
measures were typically documented on the Annual Integrity Form. However, they
were not able to provide any of those forms from 2006 to current.
Jayhawk did not document the mitigative review form for the Roth to Sullivan line
segment. Per Section 7 (Preventitative and Mitigative Measures of the IMP program)
of Jayhawk/NCRA’s IMP manual, a mitigative review form should have been filled
out for the Roth to Sullivan line segment. Company personnel could not find any
follow-up documentation after being risk ranked in April 2010.
Proposed Civil Penalty
Under 49 United States Code, § 60122, you are subject to a civil penalty not to exceed
$200,000 per violation per day the violation persists up to a maximum of $2,000,000 for a
related series of violations. For violations occurring prior to January 4, 2012, the maximum
4



penalty may not exceed $100,000 per violation per day, with a maximum penalty not to
exceed $1,000,000 for a related series of violations. The Compliance Officer has reviewed the
circumstances and supporting documentation involved in the above probable violation(s) and
has recommended that you be preliminarily assessed a civil penalty of $82,400 as follows:
Item number PENALTY
1 $ 29,300
2 $ 33,100
4 $ 20,000
Proposed Compliance Order
With respect to item(s) 2, 3, and 4 pursuant to 49 United States Code § 60118, the Pipeline
and Hazardous Materials Safety Administration proposes to issue a Compliance Order to
Jayhawk Pipeline. Please refer to the Proposed Compliance Order, which is enclosed and
made a part of this Notice.
Response to this Notice
Enclosed as part of this Notice is a document entitled Response Options for Pipeline
Operators in Compliance Proceedings. Please refer to this document and note the response
options. All material you submit in response to this enforcement action may be made publicly
available. If you believe that any portion of your responsive material qualifies 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 qualify for confidential treatment
redacted and an explanation of why you believe the redacted information qualifies for
confidential treatment under 5 U.S.C. 552(b). If you do not respond within 30 days of receipt
of this Notice, this constitutes a waiver of your right to contest the allegations in this Notice
and authorizes the Associate Administrator for Pipeline Safety to find facts as alleged in this
Notice without further notice to you and to issue a Final Order.
In your correspondence on this matter, please refer to CPF 3-2013-5011 and for each
document you submit, please provide a copy in electronic format whenever possible.
Sincerely,
David Barrett
Director, Central Region
Pipeline and Hazardous Materials Safety Administration
Enclosures: Proposed Compliance Order
Response Options for Pipeline Operators in Compliance Proceedings
5



PROPOSED COMPLIANCE ORDER
Pursuant to 49 United States Code § 60118, the Pipeline and Hazardous Materials Safety
Administration (PHMSA) proposes to issue to Jayhawk Pipeline a Compliance Order
incorporating the following remedial requirements to ensure the compliance of Jayhawk
Pipeline with the pipeline safety regulations:
1. 2. 3. 3. 4. In regard to Item Number 2 of the Notice pertaining to Jayhawk not performing
a leak detection capability analysis on any of the pipeline segments,
Jayhawk/NCRA must conduct the leak detection capability analysis on the
Jayhawk, KAW, and NCRA systems.
In regard to Item Number 3 of the Notice pertaining to Jayhawk not conducting
an EFRD analysis of the KAW system. Jayhawk must perform the EFRD
analysis on the KAW pipeline system.
In regard to Item 4 of the Notice pertaining to Jayhawk not maintaining
numerous required Integrity Management documents and records, a document
management and records retention system must be established within 90 days
of the Final Order. Submit the proposed document management process to the
Region Director within 30 days of the Final order for the Director’s approval.
The evaluations required in 1 and 2 of this Proposed Compliance Order must
be completed within 60 days of the date of the Final Order. Submit to the
Region Director documentation of the evaluations within 30 days of
completion.
It is requested (not mandated) that Jayhawk Pipeline maintain documentation
of the safety improvement costs associated with fulfilling this Compliance
Order and submit the total to David Barrett, Director, Central Region, Pipeline
and Hazardous Materials Safety Administration. It is requested that these costs
be reported in two categories: 1) total cost associated with preparation/revision
of plans, procedures, studies and analyses, and 2) total cost associated with
replacements, additions and other changes to pipeline infrastructure.
6

320135011_Final Order_06282013_text.pdf

JUNE 28, 2013
Mr. James S. Loving
President
National Cooperative Refinery Association
2000 South Main Street
McPherson, Kansas 67460
Re: CPF No. 3-2013-5011
Dear Mr. Loving:
Enclosed please find the Final Order issued in the above-referenced case. It makes findings of
violation, assesses a civil penalty of $82,400, and specifies actions that need to be taken by
National Cooperative Refinery Association and its affiliates, Jayhawk Pipeline, LLC, and Kaw
Pipe Line Company, to comply with the pipeline safety regulations. This letter acknowledges
receipt of payment of the full penalty amount, by wire transfer dated May 6, 2013. When the
compliance order has been completed, as determined by the Director, Central Region, this
enforcement action will be closed. Service of the Final Order by certified mail is deemed
effective upon the date of mailing, or as otherwise provided under 49 C.F.R. § 190.5.
Thank you for your cooperation in this matter.
Sincerely,
Jeffrey D. Wiese
Associate Administrator
for Pipeline Safety
Enclosure
cc: Mr. David Barrett, Director, Central Region, OPS
Mr. Alan Mayberry, Deputy Associate Administrator for Field Operations, OPS
Mr. Richard S. Peterson, Vice President, Transportation, National Cooperative Refinery
Association
CERTIFIED MAIL - RETURN RECEIPT REQUESTED



U.S. DEPARTMENT OF TRANSPORTATION
PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION
OFFICE OF PIPELINE SAFETY
WASHINGTON, D.C. 20590
_________________________________________
In the Matter of )
National Cooperative Refinery Association, ) CPF No. 3-2013-5011
a nonprofit corporation, )
)
)
)
Respondent. )
_________________________________________ )
FINAL ORDER
On December 5-8, 2011, pursuant to 49 U.S.C. § 60117, representatives of the Pipeline and
Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),
conducted an on-site pipeline safety inspection of the records and integrity management program
(IMP) of Jayhawk Pipeline, LLC (Jayhawk), in McPherson, Kansas. Jayhawk is a wholly-owned
subsidiary of National Cooperative Refinery Association (NCRA or Respondent).1 NCRA
operates a refinery in McPherson and transports product from that refinery through pipelines in
Kansas, Nebraska, and Iowa.
2 Jayhawk transports crude oil over more than 1,000 miles of
pipeline in Nebraska, Kansas, Oklahoma, and Texas.3 Jayhawk also operates pipelines for Kaw
Pipe Line Company (Kaw),4 which is majority-owned by NCRA.5 The IMP inspection covered
the NCRA, Jayhawk, and Kaw pipeline systems.6
As a result of the inspection, the Director, Central Region, OPS (Director), issued to Jayhawk, by
letter dated April 5, 2013, a Notice of Probable Violation, Proposed Civil Penalty, and Proposed
Compliance Order (Notice). In accordance with 49 C.F.R. § 190.207, the Notice proposed
finding that Jayhawk had committed various violations of 49 C.F.R. § 195.452 and proposed
assessing a civil penalty of $82,400 for the alleged violations. The Notice also proposed
1 Jayhawk Pipeline, LLC, website (Jayhawk website), available at http://www.jayhawkpl.com/ (last accessed
June 6, 2013)
2 NCRA website, available at http://www.ncra.coop/MediaCenter/Gettoknow.pdf (last accessed June 6, 2013).
3 Jayhawk website, supra note 1.
4 Id.
5 NCRA website, supra note 2.
6 Pipeline Safety Violation Report (Violation Report), (April 5, 2013) (on file with PHMSA), at 1.



2
ordering Jayhawk to take certain measures to correct the alleged violations.
7
NCRA responded to the Notice on behalf of NCRA, Jayhawk, and Kaw, by letter dated
May 3, 2013 (Response). NCRA did not contest the allegations of violation and paid the
proposed civil penalty of $82,400, as provided in 49 C.F.R. § 190.227. Payment of the penalty
authorizes the Associate Administrator to make findings of violation as to the uncontested items,
with prejudice to Respondent.
FINDINGS OF VIOLATION
In its Response, NCRA did not contest the allegations in the Notice that it violated 49 C.F.R.
Part 195, as follows:
Item 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(j)(2), which states:
§ 195.452 Pipeline integrity management in high consequence areas.
(a) . . . .
(j) What is a continual process of evaluation and assessment to
maintain a pipeline’s integrity?—(1) . . . .
(2) Evaluation. An operator must conduct a periodic evaluation as
frequently as needed to assure pipeline integrity. An operator must base
the frequency of evaluation on risk factors specific to its pipeline,
including the factors specified in paragraph (e) of this section. The
evaluation must consider the results of the baseline and periodic integrity
assessments, information analysis (paragraph (g) of this section), and
decisions about remediation, and preventive and mitigative actions
(paragraphs (h) and (i) of this section).
The Notice alleged that Respondent violated 49 C.F.R. § 195.452(j)(2) by failing to conduct a
periodic evaluation of its line pipe as frequently as needed to assure pipeline integrity.
Specifically, the Notice alleged that NCRA’s evaluation process failed to consider the results of
integrity assessments and information analyses for two Jayhawk line segments and three NCRA
line segments.
Respondent did not contest this allegation of violation. Accordingly, based upon a review of all
of the evidence, I find that Respondent violated 49 C.F.R. § 195.452(j)(2) by failing to conduct a
periodic evaluation of its line pipe as frequently as needed to assure pipeline integrity.
7 Although the Notice was issued solely to Jayhawk, it alleged violations by NCRA, Jayhawk, and Kaw. Since
NCRA controls all three entities, responded to the Notice on behalf of Jayhawk, and did not contest any of the
violations, this Final Order is being issued to NCRA, the parent organization.



3
Item 2: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(i)(3), which states:
§ 195.452 Pipeline integrity management in high consequence areas.
(a) . . . .
(i) What preventive and mitigative measures must an operator take to
protect the high consequence area?—(1) . . . .
(3) Leak detection. An operator must have a means to detect leaks on
its pipeline system. An operator must evaluate the capability of its leak
detection means and modify, as necessary, to protect the high consequence
area. An operator’s evaluation must, at least, consider, the following
factors—length and size of the pipeline, type of product carried, the
pipeline's proximity to the high consequence area, the swiftness of leak
detection, location of nearest response personnel, leak history, and risk
assessment results.
The Notice alleged that Respondent violated 49 C.F.R. § 195.452(i)(3) by failing to evaluate the
capability of its pipeline leak detection system to detect leaks that could affect high consequence
areas (HCAs).
8 Specifically, the Notice alleged that Respondent did not perform a leak detection
capability evaluation on any segment in the NCRA, Jayhawk, or Kaw pipeline systems.
Respondent did not contest this allegation of violation. Accordingly, based upon a review of all
of the evidence, I find that Respondent violated 49 C.F.R. § 195.452(i)(3) by failing to evaluate
the capability of its pipeline leak detection system to detect leaks that could affect HCAs.
Item 3: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(i)(4), which states:
§ 195.452 Pipeline integrity management in high consequence areas.
(a) . . . .
(i) What preventive and mitigative measures must an operator take to
protect the high consequence area?—(1) . . . .
(4) Emergency Flow Restricting Devices (EFRD). If an operator
determines that an EFRD is needed on a pipeline segment to protect a high
consequence area in the event of a hazardous liquid pipeline release, an
operator must install the EFRD. In making this determination, an operator
must, at least, consider the following factors—the swiftness of leak
detection and pipeline shutdown capabilities, the type of commodity
carried, the rate of potential leakage, the volume that can be released,
topography or pipeline profile, the potential for ignition, proximity to
power sources, location of nearest response personnel, specific terrain
between the pipeline segment and the high consequence area, and benefits
expected by reducing the spill size.
The Notice alleged that Respondent violated 49 C.F.R. § 195.452(i)(4) by failing to determine
whether an EFRD was needed on a pipeline segment. Specifically, the Notice alleged that
8 “High Consequence Areas” are defined as commercially navigable waterways, high population areas, other
populated areas, and unusually sensitive areas. See 49 C.F.R. § 195.450.



4
Respondent added the Kaw pipeline system to its IMP in 2009 but failed to evaluate whether that
system needed one or more EFRDs.
Respondent did not contest this allegation of violation. Accordingly, based upon a review of all
of the evidence, I find that Respondent violated 49 C.F.R. § 195.452(i)(4) by failing to determine
whether an EFRD was needed on a pipeline segment.
Item 4: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(l)(1)(ii), which states:
§ 195.452 Pipeline integrity management in high consequence areas.
(a) . . . .
(f) What are the elements of an integrity management program? An
integrity management program begins with the initial framework. An
operator must continually change the program to reflect operating
experience, conclusions drawn from results of the integrity assessments,
and other maintenance and surveillance data, and evaluation of
consequences of a failure on the high consequence area. An operator must
include, at minimum, each of the following elements in its written
integrity management program:
(1) A process for identifying which pipeline segments could affect a
high consequence area;
(2) A baseline assessment plan meeting the requirements of paragraph
(c) of this section;
(3) An analysis that integrates all available information about the
integrity of the entire pipeline and the consequences of a failure (see
paragraph (g) of this section);
(4) Criteria for remedial actions to address integrity issues raised by
the assessment methods and information analysis (see paragraph (h) of this
section);
(5) A continual process of assessment and evaluation to maintain a
pipeline’s integrity (see paragraph (j) of this section);
(6) Identification of preventive and mitigative measures to protect the
high consequence area (see paragraph (i) of this section);
(7) Methods to measure the program’s effectiveness (see paragraph (k)
of this section);
(8) A process for review of integrity assessment results and
information analysis by a person qualified to evaluate the results and
information (see paragraph (h)(2) of this section).
(g) . . . .
(l) What records must be kept? (1) An operator must maintain for
review during an inspection:
(i) . . . .
(ii) Documents to support the decisions and analyses, including any
modifications, justifications, variances, deviations and determinations
made, and actions taken, to implement and evaluate each element of the
integrity management program listed in paragraph (f) of this section.



5
The Notice alleged that Respondent violated 49 C.F.R. § 195.452(l)(1)(ii) by failing to maintain
for review during an OPS inspection the documents supporting the decisions and analyses made,
and actions taken, to implement and evaluate each element of the operator’s IMP. Specifically,
the Notice alleged eight deficiencies in NCRA’s IMP recordkeeping: (a) insufficient
documentation showing new HCAs identified after 2006; (b) missing documentation of the
Communication of Evaluation for 2010; (c) missing documentation of a baseline assessment on
the Kaw pipeline system; (d) missing documentation of a continual assessment and evaluation on
the NCRA pipeline system for 2008 and 2009; (e) missing documentation of a reassessment
interval analysis for the NCRA, Jayhawk, and Kaw pipeline systems; (f) missing documentation
of effectiveness reviews for the NCRA system; (g) missing documentation of performance
measure evaluations for the NCRA and Jayhawk pipeline systems from 2006 to the date of the
inspection; and (h) missing documentation of a preventive and mitigation measure review for a
Kaw pipeline segment that was risk-ranked in April 2010.
Respondent did not contest this allegation of violation. Accordingly, based upon a review of all
of the evidence, I find that Respondent violated 49 C.F.R. § 195.452(l)(1)(ii) by failing to
maintain for review during an OPS inspection the documents supporting the decisions and
analyses made, and actions taken, to implement and evaluate each element of its IMP.
These findings of violation will be considered prior offenses in any subsequent enforcement
action taken against Respondent.
ASSESSMENT OF PENALTY
Under 49 U.S.C. § 60122, Respondent is subject to an administrative 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. In determining the amount of a civil penalty under
49 U.S.C. § 60122 and 49 C.F.R. § 190.225, I must consider the following criteria: the nature,
circumstances, and gravity of the violation, including adverse impact on the environment; the
degree of Respondent’s culpability; the history of Respondent’s prior offenses; the Respondent’s
ability to pay the penalty and any effect that the penalty may have on its ability to continue doing
business; and the good faith of Respondent in attempting to comply with the pipeline safety
regulations. In addition, I may consider the economic benefit gained from the violation without
any reduction because of subsequent damages, and such other matters as justice may require.
The Notice proposed a total civil penalty of $82,400 for the violations cited above.
Item 1: The Notice proposed a civil penalty of $29,300 for Respondent’s violation of
49 C.F.R. § 195.452(j)(2), for failing to conduct a periodic evaluation of its line pipe as
frequently as needed to assure pipeline integrity. NCRA paid the proposed penalty, which serves
to authorize the Associate Administrator to assess the proposed penalty, with prejudice to
Respondent. Accordingly, having reviewed the record and considered the assessment criteria, I
assess Respondent a civil penalty of $29,300 for violation of 49 C.F.R. § 195.452(j)(2).
Item 2: The Notice proposed a civil penalty of $33,100 for Respondent’s violation of



6
49 C.F.R. § 195.452(i)(3), for failing to evaluate the capability of its pipeline leak detection
system to detect leaks that could affect HCAs. NCRA paid the proposed penalty, which serves
to authorize the Associate Administrator to assess the proposed penalty, with prejudice to
Respondent. Accordingly, having reviewed the record and considered the assessment criteria, I
assess Respondent a civil penalty of $33,100 for violation of 49 C.F.R. § 195.452(i)(3).
Item 4: The Notice proposed a civil penalty of $20,000 for Respondent’s violation of
49 C.F.R. § 195.452(l)(1)(ii), for failing to maintain for review during OPS inspections the
documents supporting the decisions and analyses made, and actions taken, to implement and
evaluate each element of its IMP. NCRA paid the proposed penalty, which serves to authorize
the Associate Administrator to assess the proposed penalty, with prejudice to Respondent.
Accordingly, having reviewed the record and considered the assessment criteria, I assess
Respondent a civil penalty of $20,000 for violation of 49 C.F.R. § 195.452(l)(1)(ii).
In summary, having reviewed the record and considered the assessment criteria for each of the
Items cited above, I assess Respondent a total civil penalty of $82,400.
COMPLIANCE ORDER
The Notice proposed a compliance order with respect to Items 2, 3, and 4 in the Notice for
violations of 49 C.F.R. § 195.452(i)(3), (i)(4), and (l)(1)(ii), respectively. Under
49 U.S.C. § 60118(a), each person who engages in the transportation of hazardous liquids or who
owns or operates a pipeline facility is required to comply with the applicable safety standards
established under chapter 601. Pursuant to the authority of 49 U.S.C. § 60118(b) and
49 C.F.R. § 190.217, Respondent is ordered to take the following actions to ensure compliance
with the pipeline safety regulations applicable to its operations:
1. With respect to the violation of § 195.452(i)(3) (Item 2), Respondent must
conduct a leak detection capability analysis on the NCRA, Jayhawk, and Kaw
pipeline systems.
2. With respect to the violation of § 195.452(i)(4) (Item 3), Respondent must
perform an EFRD analysis of the Kaw pipeline system.
3. With respect to the violation of § 195.452(l)(1)(ii) (Item 4), Respondent must
establish a document management and retention system within 90 days of receipt of
this Final Order. Respondent must submit the proposed document management
process to the Director within 30 days of receipt of this Final Order for the Director’s
approval.
4. Respondent must complete the evaluations required in paragraphs 1 and 2 of this
Compliance Order within 60 days of receipt of this Final Order. Respondent must
submit documentation of the evaluations to the Director within 30 days of
completion.



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5. PHMSA requests that Respondent maintain documentation of the safety
improvement costs associated with fulfilling this Compliance Order and submit the
total to the Director. PHMSA requests that Respondent report these costs in two
categories: (1) total cost associated with preparation and revision of plans,
procedures, studies, and analyses; and (2) total cost associated with replacements,
additions, and other changes to pipeline infrastructure.
The Director may grant an extension of time to comply with any of the required items upon a
written request timely submitted by the Respondent and demonstrating good cause for an
extension.
Failure to comply with this Order may result in the administrative assessment of civil penalties
not to exceed $100,000 for each violation for each day the violation continues or in referral to the
Attorney General for appropriate relief in a district court of the United States.
The terms and conditions of this Final Order are effective upon service in accordance with
49 C.F.R. § 190.5.
___________________________________ __________________________
Jeffrey D. Wiese Date Issued
Associate Administrator
for Pipeline Safety
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