{"operation":"document","citation":"CPF 320190006W","title":"LAKES GAS COMPANY — Warning Letter","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2019-11-25","effective_on":null,"summary":"CLOSED warning letter citing 192.1007(f), 192.199(e), 192.479(a), 192.603(b), 192.743(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-320190006w.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-320190006w.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-320190006w","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/320190006W","body":"Warning Letter involving LAKES GAS COMPANY. PHMSA's enforcement data identifies the cited regulations as 192.1007(f),  192.199(e),  192.479(a),  192.603(b),  192.743(a). The case was opened on 2019-11-25 and is reported as closed as of 2019-11-25. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n320190006W_Warning Letter_11252019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320190006W/320190006W_Warning%20Letter_11252019.pdf\n\n320190006W_Warning Letter_11252019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320190006W/320190006W_Warning%20Letter_11252019_text.pdf\n\n320190006W_Warning Letter_11252019_text.pdf\n\nWARNING LETTER\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nNovember 25, 2019\nSteve Sargeant\nPresident and Senior Executive\nLakes Gas Company\n655 South Lake Street\nForest Lake, MN 55025\nCPF 3-2019-0006W\nDear Mr. Sargeant:\nFrom September 4-6, 2018, a representative of the Pipeline and Hazardous Materials Safety\nAdministration (PHMSA) pursuant to Chapter 601 of 49 United States Code (U.S.C.) inspected\nyour liquid propane systems in Door County, Michigan.\nAs a result of the inspection, it is alleged that you have committed probale violations of the\nPipeline Safety Regulations, Title 49, Code of Federal Regulations (CFR). The items inspected\nand the probable violations are:\n1. §192.199 Requirements for design of pressure relief and limiting devices.\n(a) . . . . .\n(e) Have discharge stacks, vents, or outlet ports designed to prevent accumulation of\nwater, ice, or snow, located where gas can be discharged into the atmosphere\nwithout undue hazard;\nLakes Gas Company (Lakes) failed to design its regulator station with a pressure relief or\npressure limiting device that met the requirement of §192.199. Specifically, Lakes’\nregulator station did not have a relief valve that had a discharge stack located where gas\n\n\n\ncould be discharged into the atmosphere without undue. During the inspection, PHMSA\nfound the relief valve stack located at the Birch Grove Condos in Fish Creek, WI\ndischarged into an underground container covered dome where the isolation valve was\nalso located. The dome had an approximately 5-inch hole in its lid; therefore, if the relief\nactivated, personnel trying to reach the isolation valve would be placed in a hazardous\nsituation.\n2. §192.479 Atmospheric corrosion control: General.\n(a) Each operator must clean and coat each pipeline or portion of pipeline that is\nexposed to the atmosphere, except pipelines under paragraph (c) of this section.\nLakes failed to clean and coat portions of its pipeline exposed to the atmosphere as\nrequired by §192.479. During the inspection, PHMSA found the following pipeline\nlocations where the pipeline had not been cleaned and coated to prevent atmospheric\ncorrosion:\n Hill at Eames Farms in Egg Harbor, WI\no Meter settings at Garage Building, 7860 B residence, 7805, 7806, 7808,\n7811, 7817, 7818, 7821, and 7822\n Maxwell Shops in Egg Harbor, WI\no Meter set piping\n3. §192.603 General provisions.\n(a) . . . . .\n(b) Each operator shall keep records necessary to administer the procedures\nestablished under §192.605.\nLakes did not keep records necessary to administer the procedures established under\n§192.605. Specifically, Lakes did not keep records documenting its administration of\nfour sections in the manual of written procedures required under §192.605.\nFirst, Lakes did not keep records documenting its periodic reviews of the work done by\noperator personnel to determine the effectiveness, and adequacy of the procedures.1\nLakes’ staff informed PHMSA during the inspection that no records were kept regarding\nthese reviews.\nSecond, Lakes did not keep records documenting its training of operating personnel to\nassure that they are knowledgeable of the emergency procedures and verifying that the\n1 Section 192.605(b)(8) requires operators to prepare and follow written procedures for “periodically reviewing the\nwork done by operator personnel to determine the effectiveness and adequacy of the procedures used in normal\noperation and maintenance and modifying the procedures when deficiencies were found.”\n2\n\n\n\ntraining was effective.2 During the inspection, Lakes’ staff informed PHMSA that no\nrecords were kept regarding this training.\nThird, Lakes did not keep records regarding establishing and maintaining liason with\nappropriate fire, police and other public officials to document the requirements of\n§192.615(c)(1)-(4). Lakes’ staff informed PHMSA during the inspection that no records\nwere kept regarding the administration of this portion of its emergency plan.\n4. §192.743 Pressure limiting and regulating stations: Capacity of relief devices.\n(a) Pressure relief devices at pressure limiting stations and pressure regulating\nstations must have sufficient capacity to protect the facilities to which they are\nconnected. Except as provided in §192.739(b), the capacity must be consistent with\nthe pressure limits of §192.201(a). This capacity must be determined at intervals not\nexceeding 15 months, but at least once each calendar year, by testing the devices in\nplace or by review and calculations.\nLakes did not determine their relief valve capacities to be sufficient to protect their\nfacilities at the required intervals not to exceed 15 months, but at least once calendar\nyear, by testing the device in place or reviewing the calculations. Lakes’ staff informed\nPHMSA during the inspection that these annual determinations had not been conducted\nin 2015 and 2016.\n5. §192.1007 What are the required elements of an integrity management plan?\nA written integrity management plan must contain procedures for developing and\nimplementing the following elements:\n(a) . . . . .\n(f) Periodic Evaluation and Improvement. An operator must re-evaluate threats and\nrisks on its entire pipeline and consider the relevance of threats in one location to\nother areas. Each operator must determine the appropriate period for conducting\ncomplete program evaluations based on the complexity of its system and changes in\nfactors affecting the risk of failure. An operator must conduct a complete program\nre-evaluation at least every five years. The operator must consider the results of the\nperformance monitoring in these evaluations.\nLakes did not conduct periodic re-evaluations as required by §192.1007(f). Specifically,\nLakes’ distribution integrity management plan (DIMP) requires that an annual report and\n5-year review be completed. Neither of these re-evaluations were conducted for any of\nLakes’ seven systems in Wisconsin as stated by their personnel during the inspection by\nPHMSA.\n2 Section 192.615(b)(2) requires each operator to “train the appropriate operating personnel to assure that they are\nknowledgeable of the emergency procedures and verify that the training is effective.”\n3\n\n\n\nUnder 49 U.S.C. § 60122 and 49 CFR § 190.223, you are subject to a civil penalty not to exceed\n$213,268 per violation per day the violation persists, up to a maximum of $2,132,679 for a\nrelated series of violations. For violation occurring on or after November 2, 2015 and before\nNovember 27, 2018, the maximum penalty may not exceed $209,002 per violation per day, with\na maximum penalty not to exceed $2,090,022. For violations occurring prior to November 2,\n2015, the maximum penalty may not exceed $200,000 per violation per day, with a maximum\npenalty not to exceed $2,000,000 for a related series of violations. We have reviewed the\ncircumstances and supporting documents involved in this case, and have decided not to conduct\nadditional enforcement action or penalty assessment proceedings at this time. We advise you to\ncorrect the items identified in this letter. Failure to do so will result in Lakes Gas Company\nbeing subject to additional enforcement action.\nNo reply to this letter is required. If you choose to reply, in your correspondence please refer to\nCPF 3-2019-0006W. Be advised that all material you submit in response to this enforcement\naction is subject to being made publicly available. If you believe that any portion of your\nresponsive material qualifies for confidential treatment under 5 U.S.C. 552(b), along with the\ncomplete original document you must provide a second copy of the document with the portions\nyou believe qualify for confidential treatment redacted and an explanation of why you believe\nthe redacted information qualifies for confidential treatment under 5 U.S.C. 552(b).\nSincerely,\nAllan C. Beshore\nDirector, Central Region, OPS\nPipeline and Hazardous Materials Safety Administration\n4","truncated":false,"body_characters":8613}