# CALIBER NORTH DAKOTA LLC — Notice of Probable Violation

- **operation:** document
- **citation:** CPF 320196001
- **title:** CALIBER NORTH DAKOTA LLC — Notice of Probable Violation
- **source type:** enforcement
- **agency:** Pipeline and Hazardous Materials Safety Administration
- **status:** historical
- **official:** true
- **published on:** 2019-04-29
- **effective on:** Not available
- **summary:** CLOSED notice of probable violation citing 195.402(a), 195.402(d)(3), 195.406(b), 195.505(b).
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- **markdown:** https://regulus.evalyn.ai/document/phmsa-enforcement-320196001.md
- **app url:** https://regulus.evalyn.ai/document/phmsa-enforcement-320196001
- **source url:** https://primis.phmsa.dot.gov/enforcement-data/case/320196001
**body:**

Notice of Probable Violation involving CALIBER NORTH DAKOTA LLC. PHMSA's enforcement data identifies the cited regulations as 195.402(a),  195.402(d)(3),  195.406(b),  195.505(b). The case was opened on 2019-04-29 and is reported as closed as of 2020-07-14. Proposed civil penalty: $67,600. Assessed civil penalty: $67,600. Open the official case record for notices, responses, orders, and the latest status.

Official case documents:

320196001_Closure Letter_07142020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320196001/320196001_Closure%20Letter_07142020.pdf

320196001_Closure Letter_07142020_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320196001/320196001_Closure%20Letter_07142020_text.pdf

320196001_Final Order_12022019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320196001/320196001_Final%20Order_12022019.pdf

320196001_Final Order_12022019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320196001/320196001_Final%20Order_12022019_text.pdf

320196001_NOPV PCP PCO_04292019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320196001/320196001_NOPV%20PCP%20PCO_04292019.pdf

320196001_NOPV PCP PCO_04292019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320196001/320196001_NOPV%20PCP%20PCO_04292019_text.pdf

320196001_Operator Response to Notice_07222019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320196001/320196001_Operator%20Response%20to%20Notice_07222019.pdf

320196001_Final Order_12022019_text.pdf

December 2, 2019
Mr. Daniel Werth
Chief Executive Officer
Caliber Midstream Holdings, LP
950 17th Street, Suite 1000
Denver, Colorado 80202
Re: CPF No. 3-2019-6001
Dear Mr. Werth:
Enclosed please find the Final Order issued in the above-referenced case. It makes findings of
violations, assesses a civil penalty of $67,600, and specifies actions that need to be taken by your
subsidiary Caliber North Dakota, LLC, to comply with the pipeline safety regulations. The
penalty payment terms are set forth in the Final Order. When the civil penalty has been paid and
the terms of the compliance order completed, as determined by the Director, Central Region, this
enforcement action will be closed. Service of the Final Order by certified mail is effective upon
the date of mailing, as provided under 49 C.F.R. § 190.5.
Thank you for your cooperation in this matter.
Sincerely,
Alan K. Mayberry
Associate Administrator
for Pipeline Safety
Enclosure
cc: Mr. Allan Beshore, Director, Central Region, Office of Pipeline Safety, PHMSA
Ms. Carol Butero, Director of Regulatory, Safety, and Compliance, Caliber Midstream
Holdings, LP, 950 17th Street, Suite 1000, Denver, Colorado 80202
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 )
Caliber North Dakota, LLC, ) CPF No. 3-2019-6001
a subsidiary of Caliber Midstream Holdings, LP, )
)
)
)
Respondent. )
_____________________________________________)
On March 8, 2017, pursuant to 49 U.S.C. § 60117, a representative of the Pipeline and
Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),
inspected the Safety-Related Condition Report (PHMSA Reference 20170019) (SRCR)1 of
Caliber North Dakota, LLC (Caliber or Respondent), a subsidiary of Caliber Midstream
Holdings, LP, pertaining to facilities near Alexander, North Dakota. Caliber Midstream
Holdings’ services include crude oil and natural gas gathering, transportation, treating and
processing; produced water transportation and disposal in Caliber operated injection wells; and
freshwater sourcing and transportation by pipeline linked to various points of supply.2
As a result of the inspection, the Director, Central Region, OPS (Director), issued to Respondent,
by letter dated April 29, 2019, 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 Caliber had committed three violations of 49 C.F.R. Part 195 and proposed
assessing a civil penalty of $67,600 for the alleged violations. The Notice also proposed
ordering Respondent to take certain measures to correct the alleged violations.
After requesting and receiving an extension of time to respond, Caliber responded to the Notice
by letter dated July 22, 2019 (Response). Caliber stated that it was “electing to contest the
allegations” in the Notice, but failed to challenge the allegations relating to Items 1 and 3, as well
as Item 3’s associated penalty.3 Caliber contested the allegation of violation for Item 2, and the
proposed penalties associated with Items 1 and 2. On August 28, 2019, the company provided
an email with additional information, admitting the violations for Items 1 and 2 (Supplemental
Response). Respondent did not request a hearing and therefore has waived its right to one.
FINAL ORDER
1 Pipeline Safety Violation Report (Violation Report), (Apr. 29, 2019) (on file with PHMSA), at Exhibit A.
2 Caliber Midstream Holdings, LP, is a joint venture supported by capital contributions from BlackRock’s Global
Energy & Power Infrastructure Fund and Triangle Petroleum Corporation. http://www.calibermidstream.com/about
(last accessed Sept. 18, 2019).
3 Response, at 1.



CPF No. 3-2019-6001
Page 2
FINDINGS OF VIOLATION
The Notice alleged that Respondent violated 49 C.F.R. Part 195, as follows:
Item 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.402(d)(3), which states:
§ 195.402 Procedural manual for operations, maintenance, and
emergencies.
(a) General. Each operator shall prepare and follow for each pipeline
system a manual of written procedures for conducting normal operations
and maintenance activities and handling abnormal operations and
emergencies ...
(b) ...
(d) Abnormal operation. The manual required by paragraph (a) of this
section must include procedures for the following to provide safety when
operating design limits have been exceeded:
(1) ...
(3) Correcting variations from normal operation of pressure and flow
equipment and controls.
The Notice alleged that Respondent violated 49 C.F.R. § 195.402(d)(3) by failing to follow its
manual of written procedures for handling abnormal operations when it failed to correct
variations from normal operations of pressure equipment and controls on its Alex Crude Oil
Facility. Specifically, the Notice alleged that in the mandated SRCR filed by Caliber on March
3, 2017 that a subsequent PHMSA investigation revealed violations by Caliber employees that
led to the Safety related condition, as defined in §195.55. The company indicated that on
February 27, while performing a lower-explosive-limit and hydrogen sulfide detector calibration,
a company instrumentation and electrical (I&E) technician acknowledged alarms, but failed to
inspect and confirm the opening of the facility’s emergency shutdown valve. The valve
remained closed, thereby creating an abnormal operation. Instead of correcting the variation
from normal operations, the I&E technician continued his calibrations tests, which resulted in the
pipeline pressure rising to 522 pounds per square inch (psig) on its 150 psig normal operating
system.
According to the Notice, Caliber’s abnormal operations procedures (Rev. 5/12/2014), Section
13.1, provides that “[a]ctivation of any safety device” constitutes an example of an abnormal
operating condition. Under “Follow-up,” the procedure states: “After an abnormal operating
condition has been corrected, check variations from normal operation (at critical locations in the
system) to determine continued integrity and safe operation.” The I&E technician nor any
Caliber employee on scene did not follow the Caliber’s abnormal operating procedures after the
Alex Crude Oil Facility experienced an activation of the emergency shut down safety device
thereby allowing an overpressurization event to occur.
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. § 195.402(d)(3) by failing to follow its
manual of written procedures for handling abnormal operations when it failed to correct
variations from normal operations of pressure equipment and controls on its Alex Crude Oil
Facility.



CPF No. 3-2019-6001
Page 3
Item 2: The Notice alleged that Respondent violated 49 C.F.R. § 195.406(b), which states:
§ 195.406 Maximum operating pressure.
(a) ....
(b) No operator may permit the pressure in a pipeline during surges or
other variations from normal operations to exceed 110 percent of the
operating pressure limit established under paragraph (a) of this section.
Each operator must provide adequate controls and protective equipment to
control the pressure within this limit.
The Notice alleged that Respondent violated 49 C.F.R. § 195.406(b) by failing to provide
adequate controls and protective equipment to limit the pressure of its pipeline to 110 percent of
maximum operating pressure (MOP). Specifically, the Notice alleged that, on February 27,
2017, Caliber’s pipeline rose to a recorded pressure of 522.75 psig and an estimated pressure of
630 psig at its lowest elevation. The normal operating pressure was 150 psig and its maximum
allowable pressure on this line was established as 500 psig. Therefore, the pipeline reached a
pressure of 126 percent MOP.
In its Response, Caliber contested this violation, stating that its operating pressure did not exceed
MOP and that it therefore had adequate controls and protective equipment in place to control the
pressure.4 However, in its Supplemental Response, its Director of Regulatory, Safety and
Compliance admitted that the Response was not correct and that “the original information
submitted based on elevation calculation shows MOP was exceeded at the lowest elevation of the
system.”5
Accordingly, after considering all of the evidence, I find that Respondent violated 49 C.F.R.
§ 195.406(b) by failing to provide adequate controls and protective equipment to limit the
pressure of its pipeline to 110 percent of MOP.
Item 3: The Notice alleged that Respondent violated 49 C.F.R. § 195.505(b), which states:
§ 195.505 Qualification program.
Each operator shall have and follow a written qualification program.
The program shall include provisions to:
(a) ....
(b) Ensure through evaluation that individuals performing covered tasks
are qualified…
The Notice alleged that Respondent violated 49 C.F.R. § 195.505(b) by failing to follow its
written operator qualification program to ensure, through evaluation, that individuals performing
covered tasks are qualified. Specifically, the Notice alleged that on February 13 or 16 and 21,
2017, an unqualified technician performed the covered task (Task ID 661) of “Launching and
Receiving Internal Devices (pigs)” on the Skevolds to Alexander 16-inch Oil Line without being
directed and observed by a qualified individual.
4 Response, at 2.
5 Supplemental Response, at 1.



CPF No. 3-2019-6001
Page 4
Caliber’s Operator Qualification Plan in Section 1.0 Scope states: “Caliber OQ Program is
designed to ensure that all individuals working on Caliber DOT-regulated pipeline facilities are
OQ-qualified to perform specific covered tasks, to document that qualification and to reduce the
probability and consequences of incidents and accidents. All Caliber employees as well as
Contractors performing these covered tasks will be OQ-qualified under this Program before they
perform any covered tasks.”
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. § 195.505(b) by failing to follow its
written operator qualification program to ensure, through evaluation, that individuals performing
covered tasks are qualified.
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
$200,000 per violation for each day of the violation, up to a maximum of $2,000,000 for any
related series of violations.6 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; 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 $67,600 for the violations cited above.
Item 1: The Notice proposed a civil penalty of $22,400 for Respondent’s violation of 49 C.F.R.
§ 195.402(d)(3), for failing to follow its manual of written procedures for handling abnormal
operations when it failed to correct variations from normal operations of pressure equipment and
controls on its Alex Crude Oil Facility.
In its Response, Caliber contested the proposed penalty and requested that it be reduced. The
company contended that the Violation Report incorrectly stated, under Part E5 “Circumstances,”
that “PHMSA or a State Partner discovered the violation.” Caliber claimed, on the contrary, that
PHMSA became aware of the violation through Caliber’s own self-reported Safety-Related
Condition Report.7 Therefore, Caliber asserted that since it had disclosed the over-pressure
event through the SRCR, it was entitled to a reduced penalty under Part E5 of the Violation
Report and penalty worksheet.
I disagree. The language in the Violation Report is clear. Part E5 states, in boldface type, that
the lower penalty for self-reporting “Does not apply to operator post-accident/incident self-
6 These amounts are adjusted annually for inflation. See 49 C.F.R. § 190.223.
7 Response, at 1.



CPF No. 3-2019-6001
Page 5
reporting.” Operators are required to promptly file post-accident reports and SRCRs, as was
done in this case, and the violation was discovered by PHMSA through a routine review of such
reports. Therefore, the selection of “PHMSA or a State Partner discovered the violation” in Part
E5 is correct and the company does not qualify for a reduced penalty.
Accordingly, having reviewed the record and considered the assessment criteria, I assess
Respondent a civil penalty of $22,400 for violation of 49 C.F.R. § 195.402(d)(3).
Item 2: The Notice proposed a civil penalty of $22,400 for Respondent’s violation of 49 C.F.R.
§ 195.406(b), for failing to provide adequate controls and protective equipment to limit the
pressure on its pipeline to 110 percent of MOP.
Caliber contested the proposed penalty and requested that it be eliminated or reduced. The
company repeated its argument regarding whether a SRCR is considered a “self-report” when
calculating a penalty under Part E5 “Circumstances” of the Violation Report. I have rejected this
argument above.
It also argued that the Violation Report failed to recognize under Part E5 “Circumstances” that
the violation had ended and was not “ongoing.” Caliber stated that it “promptly began an
internal investigation of the event and voluntarily began putting corrective procedures in place.”
Caliber, however, did not take into account the rest of Part E5, which states: “If the violation was
not remedied before the end of inspection activities, enter the last known date of the violation…
and indicate Ongoing.” The violation was not remedied by March 8, 2017, the end date of the
inspection activities, so therefore the Violation Report is accurate.
Caliber also claimed that the Violation Report was incorrect in stating under “Circumstances”
that the duration of the violation was over 10 days. Caliber argued that “[t]he entire event was
resolved in 6.5 hours. The controls were in place prior to the surge event to prevent a surge
event that would have constituted a violation.” Caliber misunderstands the extent of the
violation. Section 195.406(b) requires that the operator not allow its pipeline pressure to exceed
100 percent of the operating pressure limit, and also that each operator provide adequate controls
and protective equipment to control the pressure within this limit. While the pressure surge in
this case may have only lasted 6.5 hours, Caliber did not complete its check or correct the
problem through the addition of certain alarms until March 10, 2017, which was more than 10
days after the February 27 event. I am therefore unpersuaded by this argument.
Finally, Caliber argued that it did not receive proper credit under Part E5 “Culpability” of the
Violation Report for actions it took following the incident. It reiterated that the Violation Report
is incorrect because Caliber does not agree that PHMSA discovered the violation. Rather, it
believes that since the violation is based on Caliber’s SRCR, Caliber should receive credit for
self-reporting. It also stated that “[p]rior to its submittal of its SRCR Caliber identified, planned,
scheduled and timely completed seven different follow-up / corrective actions. These follow-up
/ corrective actions were listed [in the] SRCR.”8
I have already rejected Caliber’s argument that the SRCR was a “self-report.” Likewise, Caliber
is required to follow Federal pipeline safety regulations. While the actions taken by Caliber
8 Response, at 2.



CPF No. 3-2019-6001
Page 6
following the incident are commendable, they are actions that any prudent operator would be
expected to take in the aftermath of a safety-related condition. It cannot expect to receive credit
for steps taken to come into compliance with requirements it must follow by law. I therefore
reject this argument.
Accordingly, having reviewed the record and considered the assessment criteria, I assess
Respondent a civil penalty of $22,400 for violation of 49 C.F.R. § 195.406(b).
Item 3: The Notice proposed a civil penalty of $22,800 for Respondent’s violation of 49 C.F.R.
§ 195.505(b), for failing to follow its written qualification program provisions to ensure, through
evaluation, that individuals performing covered tasks are qualified. Caliber did not contest the
proposed penalty associated with this violation. Accordingly, having reviewed the record and
considered the assessment criteria, I assess Respondent a civil penalty of $22,800 for violation of
49 C.F.R. § 195.505(b).
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 $67,600.
Payment of the civil penalty must be made within 20 days of service. Federal regulations (49
C.F.R. § 89.21(b)(3)) require such payment to be made by wire transfer through the Federal
Reserve Communications System (Fedwire), to the account of the U.S. Treasury. Detailed
instructions are contained in the enclosure. Questions concerning wire transfers should be
directed to: Financial Operations Division (AMK-325), Federal Aviation Administration, Mike
Monroney Aeronautical Center, 6500 S MacArthur Blvd, Oklahoma City, Oklahoma 79169.
The Financial Operations Division telephone number is (405) 954-8845.
Failure to pay the $67,600 civil penalty will result in accrual of interest at the current annual rate
in accordance with 31 U.S.C. § 3717, 31 C.F.R. § 901.9 and 49 C.F.R. § 89.23. Pursuant to
those same authorities, a late penalty charge of six percent (6%) per annum will be charged if
payment is not made within 110 days of service. Furthermore, failure to pay the civil penalty
may result in referral of the matter to the Attorney General for appropriate action in a district
court of the United States.
COMPLIANCE ORDER
The Notice proposed a compliance order with respect to Item 2 in the Notice for the violation of
49 C.F.R. § 195.406(b). 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 § 195.406(b) (Item 2), Respondent must test
its failsafe system to ensure that it functions properly. Documentation of this
testing procedure(s) must be provided to PHMSA for review and approval.
Results of this testing must also be provided to PHMSA.



CPF No. 3-2019-6001
Page 7
2. Caliber shall submit its procedures for testing its system within 60 days after
receipt of the Final Order, with completion of testing and documentation
submitted within 120 days after receipt of the Final Order.
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.
It is requested (not mandated) that Respondent maintain documentation of the safety
improvement costs associated with fulfilling this Compliance Order and submit the total to the
Director. 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.
Failure to comply with this Order may result in the administrative assessment of civil penalties
not to exceed $200,000, as adjusted for inflation (49 C.F.R. § 190.223), 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.
Under 49 C.F.R. § 190.243, Respondent may submit a Petition for Reconsideration of this Final
Order to the Associate Administrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey
Avenue, SE, East Building, 2nd Floor, Washington, DC 20590, with a copy sent to the Office of
Chief Counsel, PHMSA, at the same address, no later than 20 days after receipt of service of this
Final Order by Respondent. Any petition submitted must contain a statement of the issue(s) and
meet all other requirements of 49 C.F.R. § 190.243. The filing of a petition automatically stays
the payment of any civil penalty assessed. The other terms of the order, including corrective
action, remain in effect unless the Associate Administrator, upon request, grants a stay.
The terms and conditions of this Final Order are effective upon service, in accordance with 49
C.F.R. § 190.5.
December 2, 2019
___________________________________ __________________________
Alan K. Mayberry Date Issued
Associate Administrator
for Pipeline Safety

320196001_NOPV PCP PCO_04292019_text.pdf

NOTICE OF PROBABLE VIOLATION
PROPOSED CIVIL PENALTY
and
PROPOSED COMPLIANCE ORDER
CERTIFIED MAIL - RETURN RECEIPT REQUESTED
April 29, 2019
Daniel Werth,
Chief Executive Officer
Caliber Midstream
950 17th Street, Suite 1000,
Denver, CO 80202
CPF 3-2019-6001
Dear Mr. Werth:
On March 8, 2017, a representative of the Pipeline and Hazardous Materials Safety
Administration (PHMSA), Office of Pipeline Safety (OPS), pursuant to Chapter 601 of 49
United States Code inspected your Safety Related Condition Report (PHMSA Reference
20170019) pertaining to facilities near Alexander, ND.
As a result of the inspection, it is alleged 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. § 195.402 Procedural manual for operations, maintenance, and emergencies.
(a) General. Each operator shall prepare and follow for each pipeline system
a manual of written procedures for conducting normal operations and
maintenance activities and handling abnormal operations and emergencies . . .
(b) . . .
(d) Abnormal operation. The manual required by paragraph (a) of this section
must include procedures for the following to provide safety when operating
design limits have been exceeded:
(1) . . .
(3) Correcting variations from normal operation of pressure and flow
equipment and controls.
Caliber failed to follow its manual of written procedures for handling abnormal
operations when it failed to correct variations from normal operations of pressure
equipment and controls on its Alex Crude Oil Facility. Specifically, as reported in
their Safety Related Condition Report, “At approximately 11:20 AM CST on
02/27/2017 the Alex Oil Facility experienced an emergency shut down (ESD) where
the inlet control valve closed as a result of lower explosive limit (LEL) and hydrogen
sulfur (H2S) calibration. The I&E technician performing the calibrations onsite
acknowledged the LEL and H2S alarms from the local HMI (as a result of his
operations). The I & E technician failed to inspect and confirm the opening of the
ESD valve upon acknowledgement and the ESD valve remained latched as a result of
relays not being reset, a failsafe at the facility.” The I&E technician continued to
perform calibrations tests onsite without addressing the abnormal condition. As a
result, the pipeline pressure rose to 522 psig on its 150 psig normal operating system.
The increased pressure was not corrected to normal operations until 5:50 p.m.
Multiple technicians from other operating groups and shutting down of facilities
supplying the line with product were required to rectify the abnormal operation.
Caliber’s operations and maintenance procedures (Rev. 5/12.2014) regarding abnormal
operations in Section 13.1 includes “13. 7 Activation of any safety device” as an
abnormal operating condition example and under “Follow-up” states, “After an
abnormal operating condition has been corrected, check variations from normal
operation (at critical locations in the system) to determine continued integrity and safe
operation.” The technician failed to follow this procedure after creating the abnormal
operation by activating the LEL and H2S safety devices.
2



2. §195.406 Maximum operating pressure.
(a) ….
(b) No operator may permit the pressure in a pipeline during surges or other
variations from normal operations to exceed 110 percent of the operating
pressure limit established under paragraph (a) of this section. Each operator
must provide adequate controls and protective equipment to control the
pressure within this limit.
Caliber North Dakota LLC (Caliber) did not provide adequate controls and protective
equipment to limit the pressure to 110 percent of maximum operating pressure (MOP).
On February 27, 2017, Caliber’s pipeline rose to a recorded pressure of 522.75 psig
and an estimated pressure of 630 psig at its lowest elevation. The normal operating
pressure was 150 psig and its maximum allowable pressure on this line was established
as 500 psig. Therefore, the pipeline reached a pressure of 126% MOP which is a
violation of the 110% limit of §195.406(b).
Additionally, pressure sources to the Alexander facility failed to have adequate
controls or protective equipment to control the pressure within the 110% limit.
Specifically, PIT-100 pressure transmitter was visible via SCADA and the local HMI,
but did not have the correct alarm tags tied within the programming. As a result,
SCADA and the program were looking at alarm tags that weren’t tied to the value of
PIT-100. Also, alarm set points on LACT units were confirmed in April 2016, but
altered so that pressure on the pipeline rose higher than intended.
3. Section 195.505 Qualification program.
Each operator shall have and follow a written qualification program. The
program shall include provisions to:
(a) . . . .
(b) Ensure through evaluation that individuals performing covered tasks are
qualified;
Caliber North Dakota LLC did not follow its written qualification program provisions
to ensure through evaluation that individuals performing covered tasks are qualified.
Caliber’s Operator Qualification Plan in Section 1.0 Scope states, “Caliber OQ
Program is designed to ensure that all individuals working on Caliber DOT- regulated
pipeline facilities are OQ – qualified to perform specific covered tasks, to document
that qualification and to reduce the probability and consequences of incidents and
accidents. All Caliber employees as well as Contractors performing these covered
tasks will be OQ-qualified under this Program before they perform any covered tasks.”
Specifically, on February 13th or 16th (discrepancy in actual date in operator records)
and 21st, 2017, an unqualified technician for Caliber performed the covered task (Task
3



ID 661) of “Launching and Receiving Internal Devices (pigs)” on the Skevolds to
Alexander 16” Oil Line without being directed and observed by a qualified individual.
Proposed Civil Penalty
Under 49 U.S.C. § 60122 and 49 CFR § 190.223, you are subject to a civil penalty not to
exceed $213,268 per violation per day the violation persists, up to a maximum of $2,132,679
for a related series of violations. For violation occurring on or after November 2, 2015 and
before November 27, 2018, the maximum penalty may not exceed $209,002 per violation per
day, with a maximum penalty not to exceed $2,090,022. For violations occurring prior to
November 2, 2015, the maximum penalty may not exceed $200,000 per violation per day,
with a maximum penalty not to exceed $2,000,000 for a related series of violations. The
Compliance Officer has reviewed the circumstances and supporting documentation involved
in the above probable violations and has recommended that you be preliminarily assessed a
civil penalty of $67,600 as follows:
Item number PENALTY
1 $22,400
2 $22,400
3 $22,800
Proposed Compliance Order
With respect to item 2 pursuant to 49 United States Code § 60118, the Pipeline and Hazardous
Materials Safety Administration proposes to issue a Compliance Order to Caliber North
Dakota LLC. 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 3-2019-6001 and for each
document you submit, please provide a copy in electronic format whenever possible.
4



Sincerely,
Allan C. Beshore
Director, Central Region, OPS
Pipeline and Hazardous Materials Safety Administration
Enclosures: 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 Caliber North Dakota LLC (Caliber) a
Compliance Order incorporating the following remedial requirements to ensure the
compliance of with the pipeline safety regulations:
1. 2. 3. In regard to Item Number 2 of the Notice pertaining to providing adequate
controls and protective equipment to limit the pressure to 110 percent of
maximum operating pressure (MOP) for the entire system, Caliber must test
their failsafe system to ensure that it functions properly. Documentation of this
testing procedure(s) must be provided to PHMSA for review and approval.
Results of this testing must also be provided to PHMSA.
Caliber shall submit its procedures for testing its system within 60 days after
receipt of the Final Order with completion of testing and documentation
submitted within 120 days after receipt of the Final Order.
It is requested (not mandated) that Caliber maintain documentation of the
safety improvement costs associated with fulfilling this Compliance Order and
submit the total to Allan C. Beshore, Director, Central Region, OPS, 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

320196001_Closure Letter_07142020_text.pdf

VIA ELECTRONIC MAIL TO: dwerth@calibermidstream.com and
cbutero@calibermidstream.com
July 14, 2020
Daniel Werth,
Chief Executive Officer
Caliber Midstream
950 17th Street, Suite 1000,
Denver, CO 80202
dwerth@calibermidstream.com
Re: CPF 3-2019-6001
Dear Mr. Werth:
On March 8, 2017, a representative of the Pipeline and Hazardous Materials Safety Administration
(PHMSA), Office of Pipeline Safety (OPS), pursuant to Chapter 601 of 49 United States Code inspected
your Safety Related Condition Report (PHMSA Reference 20170019) pertaining to facilities near
Alexander, North Dakota. As a result of the inspection, the Director, Central Region, OPS issued a
Notice of Probable Violation, Proposed Civil Penalty and Proposed Compliance Order (Notice) on April
29, 2019. On December 2, 2019, PHMSA issued a Final Order, which made findings of violation,
assessed a civil penalty, and ordered Caliber Midstream to take certain compliance measures.
The records show that Caliber Midstream paid the civil penalty, in addition to submitting testing
procedures, completing the testing and documentation. My staff has reviewed these documents and
determined that the terms of the Compliance Order have been met. This case is now closed. Thank you
for your cooperation in this matter.
Sincerely,
Allan C. Beshore
Director, Central Region, OPS
Pipeline and Hazardous Materials Safety Administration
Copy: Carol Butero, Director of Regulatory, Safety, and Compliance, Caliber Midstream
Email: Carol Butero <cbutero@calibermidstream.com>
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