{"operation":"document","citation":"CPF 320195007","title":"MAGELLAN PIPELINE COMPANY, LP — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2019-10-11","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.402(a), 195.428(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-320195007.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-320195007.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-320195007","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/320195007","body":"Notice of Probable Violation involving MAGELLAN PIPELINE COMPANY, LP. PHMSA's enforcement data identifies the cited regulations as 195.402(a),  195.428(a). The case was opened on 2019-10-11 and is reported as closed as of 2021-11-19. Proposed civil penalty: $118,000. Assessed civil penalty: $97,400. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n320195007_Closure Letter_11192021_(16-152632S).pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195007/320195007_Closure%20Letter_11192021_(16-152632S).pdf\n\n320195007_Closure Letter_11192021_(16-152632S)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195007/320195007_Closure%20Letter_11192021_(16-152632S)_text.pdf\n\n320195007_Final Order_05142021_(16-152632S).pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195007/320195007_Final%20Order_05142021_(16-152632S).pdf\n\n320195007_Final Order_05142021_(16-152632S)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195007/320195007_Final%20Order_05142021_(16-152632S)_text.pdf\n\n320195007_NOPV PCP PCO_10112019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195007/320195007_NOPV%20PCP%20PCO_10112019.pdf\n\n320195007_NOPV PCP PCO_10112019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195007/320195007_NOPV%20PCP%20PCO_10112019_text.pdf\n\n320195007_Operator Response to Notice_12162019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195007/320195007_Operator%20Response%20to%20Notice_12162019.pdf\n\n320195007_NOPV PCP PCO_10112019_text.pdf\n\nNOTICE OF PROBABLE VIOLATION\nPROPOSED CIVIL PENALTY\nand\nPROPOSED COMPLIANCE ORDER\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nOctober 11, 2019\nMr. Michael Pearson\nVP Operations & Asset Integrity\nMagellan Pipeline Company, LP\nOne Williams Center, OTC-9\nTulsa, OK 74172\nCPF 3-2019-5007\nDear Mr. Pearson:\nOn various dates between May 16th 2016 and January 25th 2017, a representative of the\nPipeline and Hazardous Materials Safety Administration (PHMSA), Central Region of the\nOffice of Pipeline Safety (OPS) & Minnesota Office of Pipeline Safety pursuant to Chapter\n601 of 49 United States Code conducted an onsite pipeline safety inspection of your\nprocedures at your Tulsa, OK headquarters and records reviews at various locations in Kansas,\nOklahoma, Iowa, Illinois, Minnesota, Nebraska, South Dakota and North Dakota. Field\nreviews of your facilities were done at various locations in Wisconsin, Minnesota, Kansas,\nIowa, Illinois, Nebraska, South Dakota and North Dakota.\nAs a result of the inspection, it is alleged that you have committed probable violations of the\nPipeline Safety Regulations, Title 49, Code of Federal Regulations, Part 195. The items\ninspected and the probable violations are:\n\n\n\n1. §195.402 Procedural manual for operations, maintenance, and emergencies.\n(a) General. Each operator shall prepare and follow for each pipeline system a\nmanual of written procedures for conducting normal operations and maintenance\nactivities and handling abnormal operations and emergencies. This manual shall be\nreviewed at intervals not exceeding 15 months, but at least once each calendar year,\nand appropriate changes made as necessary to insure that the manual is effective.\nThis manual shall be prepared before initial operations of a pipeline system\ncommence, and appropriate parts shall be kept at locations where operations and\nmaintenance activities are conducted.\nOn multiple occasions, Magellan did not follow its O&M manual by failing to make\nnecessary records and maps available to personnel for safe operation and maintenance of\nthe pipeline. PHMSA inspectors observed the function of remotely operated valves that\ninvolved control room and field personnel. The valves could not be safely operated,\nbecause maps and records were not suitably available for use by operating and\nmaintenance personnel during the performance of these operations following the\nrequirements of 195.402 (c)(1).\nOn July 20th, 2016, at Bateman Station in Wisconsin, PHMSA performed an Operator\nQualification Task Protocol 9 Evaluation on a remote motor operated valve task. As part\nof this task the valve was to be remotely operated by the control room. During the\nperformance of this task, involving the field personnel and the pipeline controller, the\nwrong valve was opened.\nOn September 27th, 2016, at Rockford Station in Illinois, Magellan field personnel called\nthe control room to operate a remote operated valve. The field personnel and the\ncontroller had trouble identifying which valve was to be safely operated.\nOn January 25th, 2017, at Magellan’s Control Room, a pipeline controller was unable to\nproduce maps or records that could properly identify the location of valves to field\npersonnel.\n2\n\n\n\n2. § 195.428 Overpressure safety devices and overfill protection systems.\n(a) Except as provided in paragraph (b) of this section, each operator shall, at\nintervals not exceeding 15 months, but at least once each calendar year, or in the\ncase of pipelines used to carry highly volatile liquids, at intervals not to exceed 7 1/2\nmonths, but at least twice each calendar year, inspect and test each pressure limiting\ndevice, relief valve, pressure regulator, or other item of pressure control equipment\nto determine that it is functioning properly, is in good mechanical condition, and is\nadequate from the standpoint of capacity and reliability of operation for the service\nin which it is used.\nMagellan did not inspect overfill protection on breakout tanks used to store Highly\nVolatile Liquids (HVL) at least twice a year not to exceed 7 ½ months. HVL tanks 2021,\n2022, 2023 and 2024 located at Magellan’s Des Moines, Iowa terminal were put in to\nservice in 2009. Records presented to inspectors showed that no inspection of the overfill\nprotection system was performed after the tanks were put into service until June 30, 2016.\nProposed Civil Penalty\nUnder 49 U.S.C. § 60122 and 49 CFR § 190.223, you are subject to a civil penalty not to\nexceed $213,268 per violation per day the violation persists, up to a maximum of $2,132,679\nfor a related series of violations. For violation occurring on or after November 2, 2015 and\nbefore November 27, 2018, the maximum penalty may not exceed $209,002 per violation per\nday, with a maximum penalty not to exceed $2,090,022. For violations occurring prior to\nNovember 2, 2015, the maximum penalty may not exceed $200,000 per violation per day, with\na maximum penalty not to exceed $2,000,000 for a related series of violations. The\nCompliance Officer has reviewed the circumstances and supporting documentation involved in\nthe above probable violation(s) and has recommended that you be preliminarily assessed a civil\npenalty of $118,000 as follows:\nItem number PENALTY\n1 $51,400\n2 $66,600\nProposed Compliance Order\nWith respect to item 1 pursuant to 49 U.S.C. § 60118, the Pipeline and Hazardous Materials\nSafety Administration proposes to issue a Compliance Order to Magellan Pipeline Company,\nLP1. Please refer to the Proposed Compliance Order, which is enclosed and made a part of\nthis Notice.\n3\n\n\n\nResponse to this Notice\nEnclosed as part of this Notice is a document entitled Response Options for Pipeline Operators\nin Compliance Proceedings. Please refer to this document and note the response options. All\nmaterial submit in response to this enforcement action may be made publicly available. If you\nbelieve that any portion of your responsive material qualifies for confidential treatment under 5\nU.S.C. 552(b), along with the complete original document you must provide a second copy of\nthe document with the portions you believe qualify for confidential treatment redacted and an\nexplanation of why you believe the redacted information qualifies for confidential treatment\nunder 5 U.S.C. 552(b). If you do not respond within 30 days of receipt of this Notice, this\nconstitutes a waiver of your right to contest the allegations in this Notice and authorizes the\nAssociate Administrator for Pipeline Safety to find facts as alleged in this Notice without\nfurther notice to you and to issue a Final Order.\nIn your correspondence on this matter, please refer to CPF 3-2019-5007 and for each\ndocument you submit, please provide a copy in electronic format whenever possible.\nSincerely,\nAllan C. Beshore, PE\nDirector, Central Region, OPS\nPipeline and Hazardous Materials Safety Administration\nEnclosure: Proposed Compliance Order\nResponse Options for Pipeline Operators in Enforcement Proceedings\n4\n\n\n\nPROPOSED COMPLIANCE ORDER\nPursuant to 49 United States Code § 60118, the Pipeline and Hazardous Materials Safety\nAdministration (PHMSA) proposes to issue to Magellan Pipeline Company, LP a Compliance\nOrder incorporating the following remedial requirements to ensure the compliance of Magellan\nPipeline Company, LP with the pipeline safety regulations:\n1. In respect to Item Number 1 of the Notice, Magellan must develop adequate\nrecords needed for field and control room personnel to positively identify the\nlocation valves necessary for the safe operation of the pipeline.\n2. 3. Within sixty (60) days after receipt of a Final Order, Magellan must submit\ndocumentation to the Director, Central Region, demonstrating that Item 1 and\nhave been completed.\nIt is requested (not mandated) that Magellan Pipeline Company, LP maintain\ndocumentation of the safety improvement costs associated with fulfilling this\nCompliance Order and submit the total to Allan Beshore, Director, Central\nRegion, Pipeline and Hazardous Materials Safety Administration. It is requested\nthat these costs be reported in two categories: 1) total cost associated with\npreparation/revision of plans, procedures, studies and analyses, and 2) total cost\nassociated with replacements, additions and other changes to pipeline\ninfrastructure.\n5\n\n320195007_Final Order_05142021_(16-152632S)_text.pdf\n\nMay 14, 2021\nVIA ELECTRONIC MAIL TO: mike.mears@magellanlp.com\nMr. Michael N. Mears\nPresident and Chief Executive Officer\nMagellan Midstream Partners, LP\nOne Williams Center\nPO Box 22186\nTulsa, Oklahoma 74172-2186\nRe: CPF No. 3-2019-5007\nDear Mr. Mears:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation, assesses a reduced civil penalty of $97,400, and specifies actions that need to be taken\nby your subsidiary, Magellan Pipeline Company, LP, to comply with the pipeline safety\nregulations. The penalty payment terms are set forth in the Final Order. When the civil penalty\nhas been paid and the terms of the compliance order completed, as determined by the Director,\nCentral Region, this enforcement action will be closed. Service of the Final Order by electronic\nmail is effective upon the date of transmission as provided under 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nAlan K. Mayberry\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Mr. Gregory Ochs, Director, Central Region, Office of Pipeline Safety, PHMSA\nMr. Jason Smith, Vice President, Asset Integrity, Magellan Pipeline Company, LP\njason.smith@magellanlp.com\nMr. Mark Materna, Director, Pipeline Integrity, Magellan Pipeline Company, LP\nmark.materna@magellanlp.com\nCONFIRMATION OF RECEIPT REQUESTED\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\n________________________________________________\nIn the Matter of )\nMagellan Pipeline Company, LP ) CPF No. 3-2019-5007\na subsidiary of Magellan Midstream Partners, LP )\n)\n)\n)\nRespondent. )\n________________________________________________)\nFINAL ORDER\nBetween May 16, 2016, and January 25, 2017, pursuant to 49 U.S.C. § 60117, a representative of\nthe Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety\n(OPS), conducted an on-site pipeline safety inspection of the facilities and records of Magellan\nPipeline Company, LP (Magellan or Respondent) in Oklahoma, Kansas, Iowa, Illinois,\nMinnesota, Nebraska, South Dakota, North Dakota, and Wisconsin. Magellan is a subsidiary of\nMagellan Midstream Partners, LP, which owns and operates approximately 12,000 miles of\nliquids pipelines throughout the United States.1\nAs a result of the inspection, the Director, Central Region, OPS (Director), issued to Respondent,\nby letter dated October 11, 2019, a Notice of Probable Violation, Proposed Civil Penalty, and\nProposed Compliance Order (Notice). In accordance with 49 C.F.R. § 190.207, the Notice\nproposed finding that Magellan had violated 49 C.F.R. §§ 195.402(a) and 195.428(a) and\nproposed assessing a civil penalty of $118,000 for the alleged violations. The Notice also\nproposed ordering Respondent to take certain measures to correct the alleged violations.\nAfter requesting and receiving an extension of time to respond, Magellan Midstream Partners,\nLP, on behalf of its subsidiary, responded to the Notice by letter dated December 16, 2019\n(Response). The company contested one allegation of violation, offered additional information\nin response to the Notice, requested that the proposed civil penalty be reduced, and requested the\nwithdrawal of the compliance order. Respondent did not request a hearing and therefore has\nwaived its right to one.\n1 Liquid Pipeline Tariffs, Magellan Midstream Partners, LP, available at\nhttps://www magellanlp.com/WhatWeDo/LiquidPipelineTariffs.aspx (Last accessed February 25, 2021).\n\n\n\nCPF 3-2019-5007\nPage 2\nFINDINGS OF VIOLATION\nThe Notice alleged that Respondent violated 49 C.F.R. Part 195, as follows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.402(a), which states:\n§ 195.402 Procedural manual for operations, maintenance, and\nemergencies.\n(a) General. Each operator shall prepare and follow for each pipeline\nsystem a manual of written procedures for conducting normal operations\nand maintenance activities and handling abnormal operations and\nemergencies. This manual shall be reviewed at intervals not exceeding 15\nmonths, but at least once each calendar year, and appropriate changes made\nas necessary to insure that the manual is effective. This manual shall be\nprepared before initial operations of a pipeline system commence, and\nappropriate parts shall be kept at locations where operations and\nmaintenance activities are conducted . . . .\n(c) Maintenance and normal operations. The manual required by\nparagraph (a) of this section must include procedures for the following to\nprovide safety during maintenance and normal operations:\n(1) Making construction records, maps, and operating history available\nas necessary for safe operation and maintenance.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.402(a) by failing to follow its\nmanual of written procedures for conducting normal operations and maintenance activities and\nhandling abnormal operations and emergencies. Specifically, the Notice alleged that on multiple\noccasions, Magellan failed to make necessary records and maps available to personnel for the\nsafe operation and maintenance of its pipeline, as required by § 195.402(c)(1), as well as its\noperation and maintenance (O&M) manual. The Notice alleged that as a result, remotely\noperated valves could not be safely operated because maps and records were not suitably\navailable for use by personnel during the performance of these operations.\nThe Notice specified three instances when the PHMSA inspector observed this alleged violation:\n(1) on July 20, 2016, at the Bateman Station in Wisconsin when Magellan personnel opened the\nwrong valve during an operator qualification task protocol evaluation; (2) on September 27,\n2016, at Rockford Station in Illinois when Magellan field personnel and control room operator\nhad trouble identifying a remote operated valve; and (3) on January 25, 2017, at Magellan’s\nControl Room when a pipeline controller was unable to produce maps or records that could\nproperly identify the location of valves to field personnel.\nIn its response, Magellan did not contest the allegation of violation that occurred on July 20,\n2016, at Bateman Station. However, Magellan contested the allegations referenced on\nSeptember 27, 2016, at Rockford Station, and January 25, 2017, at the Magellan Control Room.\nMagellan claimed that the facts in the Notice and the Violation Report do not prove that a\nviolation occurred on these dates. Concerning the September 27, 2016 allegation of violation,\nMagellan argued that the PHMSA inspector requested that Magellan operate the mainline valve\n\n\n\nCPF 3-2019-5007\nPage 3\nby calling the Magellan Control Room and requesting that the valve be opened. Magellan\nclaimed that the local Magellan representative described the valve to the Controller in\nMagellan’s Control Room to ensure the correct valve was operated. Magellan also noted that\nPHMSA records for the September 27, 2016 inspection included the following note: “Operated\nthe valve remotely and local.”\nRegarding the January 25, 2017 allegation of violation, Magellan argued that during an\nimpromptu visit to the Control Room, the PHMSA inspector asked if the valve numbering on the\nsupervisory control and data acquisition (SCADA) screen matched the numbering in the field\nand inquired if the Magellan representative had access to the piping and instrumentation\ndiagrams (P&IDs) to confirm specific valve locations. The representative indicated that he did\nnot. In its Response, Magellan explained that all Magellan employees have access to maps and\nrecords, including P&IDs, through its Intranet Webpage, which is available in the Control Room.\nHowever, controllers in the Control Room are not typically expected to access P&IDs, as other\nMagellan programs and processes are in place to ensure accurate SCADA screens and\nnomenclature to reduce the complexity of operations for controllers.\nUpon review of the additional information provided by Magellan, pursuant to § 190.209(b)(7),\nthe Director provided a written evaluation of the response material and recommended that the\nSeptember 27, 2016 Rockford Station and the January 25, 2017 Magellan Control Room\ninstances of violation be withdrawn.2 After considering the additional information and\nexplanations provided by Magellan, I agree. However, as noted above, the allegation of\nviolation occurring on July 20, 2016, at Bateman Station in Wisconsin was uncontested.\nAccordingly, after considering all of the evidence, I find that Respondent violated 49 C.F.R.\n§ 195.402(a) by failing to follow its manual of written procedures for conducting normal\noperations and maintenance activities and handling abnormal operations and emergencies on\nJuly 20, 2016, at the Bateman Station in Wisconsin. The September 27, 2016 Rockford Station\nand the January 25, 2017 Magellan Control Room instances of violation are hereby withdrawn.\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. § 195.428(a), which states:\n§ 195.428 Overpressure safety devices and overfill protection systems.\n(a) Except as provided in paragraph (b) of this section, each operator\nshall, at intervals not exceeding 15 months, but at least once each calendar\nyear, or in the case of pipelines used to carry highly volatile liquids, at\nintervals not to exceed 7 ½ months, but at least twice each calendar year,\ninspect and test each pressure limiting device, relief valve, pressure\nregulator, or other item of pressure control equipment to determine that it is\nfunctioning properly, is in good mechanical condition, and is adequate from\nthe standpoint of capacity and reliability of operation for the service in\nwhich it is used.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.428(a) by failing to inspect and test\n2 Region Recommendation, at 2 (on file with PHMSA).\n\n\n\nCPF 3-2019-5007\nPage 4\neach pressure limiting device, relief valve, pressure regulator, or other item of pressure control\nequipment to determine that it is functioning properly, is in good mechanical condition, and is\nadequate from the standpoint of capacity and reliability of operation for the service in which it is\nused, at intervals not exceeding 7 ½ months, but at least twice each calendar year, for pipelines\nused to carry highly volatile liquids (HVL). Specifically, the Notice alleged that Magellan did\nnot inspect overfill protection on breakout tanks used to store HVL at least twice a year, with\nintervals not to exceed 7 ½ months. The Notice alleged that four HVL tanks located at\nMagellan's Des Moines, Iowa terminal were put into service in 2009, yet records presented to the\nPHMSA inspector showed that no inspection of the overfill protection system was performed\nafter the tanks were put into service until June 30, 2016.3\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.428(a) by failing to inspect and\ntest the overfill protection system on four breakout tanks used to store HVL to determine that it\nis functioning properly, is in good mechanical condition, and is adequate from the standpoint of\ncapacity and reliability of operation for the service in which it is used, at intervals not exceeding\n7 ½ months, but at least twice each calendar year.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nASSESSMENT OF PENALTY\nUnder 49 U.S.C. § 60122, Respondent is subject to an administrative civil penalty not to exceed\n$200,000 per violation for each day of the violation, up to a maximum of $2,000,000 for any\nrelated series of violations.4 In determining the amount of a civil penalty under 49 U.S.C.\n§ 60122 and 49 C.F.R. § 190.225, I must consider the following criteria: the nature,\ncircumstances, and gravity of the violation, including adverse impact on the environment; the\ndegree of Respondent’s culpability; the history of Respondent’s prior offenses; any effect that\nthe penalty may have on its ability to continue doing business; the good faith of Respondent in\nattempting to comply with the pipeline safety regulations; and self-disclosure or actions to\ncorrect a violation prior to discovery by PHMSA. In addition, I may consider the economic\nbenefit gained from the violation without any reduction because of subsequent damages, and\nsuch other matters as justice may require. The Notice proposed a total civil penalty of $118,000\nfor the violations cited above.\nItem 1: The Notice proposed a civil penalty of $ 51,400 for Respondent’s violation of 49 C.F.R.\n§ 195.402(a), for failing to follow its manual of written procedures for making construction\nrecords, maps, and operating history available as necessary for safe operation and maintenance.\nAs explained in detail above, Magellan contested two of the three instances of violation and\nbased on the additional information provided, those two instances have been withdrawn.\nRegarding the civil penalty, Magellan also argued that the history of prior offenses should be\n3 The four tanks are identified as 2021, 2022, 2023, and 2024.\n4 These amounts are adjusted annually for inflation. See 49 C.F.R. § 190.223.\n\n\n\nCPF 3-2019-5007\nPage 5\ncorrected because six of the eight prior offenses listed in the Violation Report occurred outside\nof the five-year period prior to the date the Notice was issued. Having reviewed the information,\nI agree. Accordingly, I find that the record supports a reduction in the number of instances of\nviolation from three to one, as well as reduction in the number of prior offenses from eight\nfindings of violation to two.\nBased upon the foregoing, I assess Respondent a reduced civil penalty of $38,000 for the\nviolation of 49 C.F.R. § 195.402(a).\nItem 2: The Notice proposed a civil penalty of $66,600 for Respondent’s violation of 49 C.F.R.\n§ 195.428(a), for failing to inspect and test the overfill protection system on four breakout tanks\nused to store HVL at intervals not exceeding 7 ½ months, but at least twice each calendar year.\nMagellan did not contest this allegation of violation but similarly argued that the history of prior\noffenses should be corrected because six of the eight prior offenses listed occurred outside of the\nfive-year period prior to the date the Notice was issued. Once again, having reviewed the\ninformation, I agree. Accordingly, I find that the record supports a reduction in the number of\nprior offenses from eight findings of violation to two.\nBased upon the foregoing, I assess Respondent a reduced civil penalty of $59,400 for violation\nof 49 C.F.R. § 195.428(a).\nIn summary, having reviewed the record and considered the assessment criteria for each of the\nItems cited above, I assess Respondent a total reduced civil penalty of $97,400.\nPayment of the civil penalty must be made within 20 days of service. Federal regulations (49\nC.F.R. § 89.21(b)(3)) require such payment to be made by wire transfer through the Federal\nReserve Communications System (Fedwire), to the account of the U.S. Treasury. Detailed\ninstructions are contained in the enclosure. Questions concerning wire transfers should be\ndirected to: Financial Operations Division (AMK-325), Federal Aviation Administration, Mike\nMonroney Aeronautical Center, 6500 S MacArthur Blvd, Oklahoma City, Oklahoma 79169.\nThe Financial Operations Division telephone number is (405) 954-8845.\nFailure to pay the $97,400 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. Pursuant to\nthose same authorities, a late penalty charge of six percent (6%) per annum will be charged if\npayment is not made within 110 days of service. Furthermore, failure to pay the civil penalty\nmay result in referral of the matter to the Attorney General for appropriate action in a district\ncourt of the United States.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Item 1 in the Notice for violation of 49\nC.F.R. § 195.402(a). Under 49 U.S.C. § 60118(a), each person who engages in the\ntransportation of hazardous liquids or who owns or operates a pipeline facility is required to\ncomply with the applicable safety standards established under chapter 601.\n\n\n\nCPF 3-2019-5007\nPage 6\nWith regard to the violation of § 195.402(a) (Item 1), Respondent requested that the compliance\norder be withdrawn because the company has already implemented the requested corrective\naction. Magellan stated that “[a]s part of the ongoing dialogue during the 2016 inspection,\nMagellan implemented corrective actions regarding the requirements for remote controlled valve\nidentification and physical tagging of the asset.” Magellan contended that these requirements\nwere incorporated into its procedure 7.13-ADM-1035, Mainline Valve Inspection Procedure, a\ncopy of which was provided to PHMSA.\nPursuant to § 190.209(b)(7), the Director provided a written evaluation of the response material\nsubmitted by Respondent and stated he did not find the provided information adequate to satisfy\nthe proposed compliance order.5 Specifically, the Director explained that Magellan needs to\nprovide its O&M Form 07-FORM-1035 for all mainline valves at the Bateman Station necessary\nfor the safe operation of the pipeline, within the scope of the inspection, to document that it has\nfollowed its O&M procedure 7.13-ADM-1035 Sections 3.17, 3.1.18.2.1 and 3.1.19.1.1.6\nWhile I appreciate Magellan’s early efforts to comply with the Compliance Order by revising\nand providing its Mainline Valve Inspection Procedure, the Compliance Order’s focus is on the\ndevelopment of records needed for field and control room personnel to positively identify the\nlocation of valves; it did not request revised procedures. Since Magellan has not provided any\nrecords field and control room personnel will use to positively identify the location of valves, the\nCompliance Order is not withdrawn as set forth below.\nPursuant to the authority of 49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217, Respondent is\nordered to take the following actions to ensure compliance with the pipeline safety regulations\napplicable to its operations:\n1. With respect to the violation of § 195.402(a) (Item 1), Respondent must develop\nadequate records needed for field and control room personnel to positively identify\nthe location valves necessary for the safe operation of the pipeline.\n2. Within sixty (60) days after receipt of a Final Order, Magellan must submit\ndocumentation to the Director, Central Region, demonstrating that Item 1 and have\nbeen completed.\nThe Director may grant an extension of time to comply with any of the required items upon a\nwritten request timely submitted by the Respondent and demonstrating good cause for an\nextension.\nPHMSA requests that Respondent maintain documentation of the safety improvement costs\nassociated with fulfilling this Compliance Order and submit the total to the Director. It is\nrequested that these costs be reported in two categories: (1) total cost associated with\npreparation/revision of plans, procedures, studies and analyses; and (2) total cost associated with\nreplacements, additions and other changes to pipeline infrastructure.\n5 Region Recommendation, at 3 (on file with PHMSA).\n6 Id.\n\n\n\nCPF 3-2019-5007\nPage 7\nFailure to comply with this Order may result in the administrative assessment of civil penalties\nnot to exceed $200,000, as adjusted for inflation (49 C.F.R. § 190.223), for each violation for\neach day the violation continues or in referral to the Attorney General for appropriate relief in a\ndistrict court of the United States.\nUnder 49 C.F.R. § 190.243, Respondent may submit a Petition for Reconsideration of this Final\nOrder to the Associate Administrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey\nAvenue, SE, East Building, 2nd Floor, Washington, DC 20590, with a copy sent to the Office of\nChief Counsel, PHMSA, at the same address, no later than 20 days after receipt of service of this\nFinal Order by Respondent. Any petition submitted must contain a statement of the issue(s) and\nmeet all other requirements of 49 C.F.R. § 190.243. The filing of a petition automatically stays\nthe payment of any civil penalty assessed. The other terms of the order, including corrective\naction, remain in effect unless the Associate Administrator, upon request, grants a stay.\nThe terms and conditions of this Final Order are effective upon service in accordance with 49\nC.F.R. § 190.5.\nMay 14, 2021\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety\n\n320195007_Closure Letter_11192021_(16-152632S)_text.pdf\n\nVIA ELECTRONIC MAIL: Mike.Mears@magellanlp.com, Jason.Smith@magellanlp.com and\nMark.Materna@magellanlp.com\nNovember 19, 2021\nMr. Michael N. Mears\nPresident and Chief Executive Officer\nMagellan Midstream Partners, LP\nOne Williams Center\nPO Box 22186\nTulsa, Oklahoma 74172-2186\nRe: CPF No. 3-2019-5007\nDear Mr. Mears:\nOn May 14, 2021, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued to\nMagellan Pipeline Company, LP a Final Order in the above-referenced case. This Order included a\nCompliance Order and Civil Penalty assessment. Based on our review of the documentation you\nprovided and confirmation of payment of the civil penalty, it has been determined that you have complied\nwith the terms of this Order.\nAccordingly, this case is now closed, and no further action is contemplated with respect to the matters\ninvolved in this case. Thank you for your cooperation in this matter.\nSincerely,\nGregory A. Ochs\nDirector, Central Region\nPipeline and Hazardous Materials Safety Administration\nCc: Jason Smith VP Asset Integrity, jason.smith@magellanlp.com\nMark Materna, Director Pipeline Integrity, mark.materna@magellanlp.com","truncated":false,"body_characters":31849}