{"operation":"document","citation":"CPF 320201005","title":"PANHANDLE EASTERN PIPELINE CO — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2020-09-09","effective_on":null,"summary":"CLOSED notice of probable violation citing 192.167(a)(4)(ii), 192.605(b)(3), 192.709(c), 192.745(a), 192.905(c), 192.937(b).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-320201005.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-320201005.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-320201005","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/320201005","body":"Notice of Probable Violation involving PANHANDLE EASTERN PIPELINE CO. PHMSA's enforcement data identifies the cited regulations as 192.167(a)(4)(ii),  192.605(b)(3),  192.709(c),  192.745(a),  192.905(c),  192.937(b). The case was opened on 2020-09-09 and is reported as closed as of 2020-12-10. Proposed civil penalty: $226,500. Assessed civil penalty: $226,500. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n320201005_Closure Letter_12102020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320201005/320201005_Closure%20Letter_12102020.pdf\n\n320201005_Closure Letter_12102020_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320201005/320201005_Closure%20Letter_12102020_text.pdf\n\n320201005_Final Order_12042020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320201005/320201005_Final%20Order_12042020.pdf\n\n320201005_Final Order_12042020_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320201005/320201005_Final%20Order_12042020_text.pdf\n\n320201005_NOPV PCP PCO_09092020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320201005/320201005_NOPV%20PCP%20PCO_09092020.pdf\n\n320201005_NOPV PCP PCO_09092020_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320201005/320201005_NOPV%20PCP%20PCO_09092020_text.pdf\n\n320201005_Operator Response to Notice_10262020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320201005/320201005_Operator%20Response%20to%20Notice_10262020.pdf\n\n320201005_Final Order_12042020_text.pdf\n\nDecember 4, 2020\nVIA ELECTRONIC MAIL TO: matthew.ramsey@energytransfer.com\nMr. Matthew Ramsey\nChief Operating Officer\nEnergy Transfer, LP\n8111 Westchester Drive\nDallas, Texas 75225\nRe: CPF No. 3-2020-1005\nDear Mr. Ramsey:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation against your subsidiary, Panhandle Eastern Pipeline Company, LP, finds that the civil\npenalty amount of $226,500 has been paid in full, and specifies actions that need to be taken to\ncomply with the pipeline safety regulations. When the terms of the compliance order are completed,\nas determined by the Director, Central Region, this enforcement action will be closed. Service of the\nFinal Order by electronic mail is effective upon the date of mailing as provided under 49 C.F.R. §\n190.5.\nThank you for your cooperation in this matter.\nSincerely,\nAlan K. Mayberry\nAssociate Administrator\nfor Pipeline Safety\nEnclosures (Final Order and NOPV)\ncc: Mr. Gregory Ochs, Director, Central Region, Office of Pipeline Safety, PHMSA\nMr. Kelcy Warren, Chief Executive Officer, Energy Transfer,\nkelcy.warren@energytransfer.com\nMr. Eric Amundsen, Senior Vice President, Operations, Energy Transfer,\neric.amundsen@energytransfer.com\nMr. Todd Nardozzi, Director, Regulatory Compliance, Energy Transfer,\ntodd.nardozzi@energytransfer.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 )\nPanhandle Eastern Pipeline Company, LP, ) CPF No. 3-2020-1005\na subsidiary of Energy Transfer, LP, )\n)\n)\n)\nRespondent. )\n__________________________________________)\nFINAL ORDER\nOn September 9, 2020, pursuant to 49 C.F.R. § 190.207, the Director, Central Region, Office of\nPipeline Safety (OPS), issued a Notice of Probable Violation (Notice) to Panhandle Eastern\nPipeline Company, LP (Respondent). The Notice proposed finding that Respondent had violated\nthe pipeline safety regulations in 49 C.F.R. Part 192. The Notice also proposed certain measures\nto correct the violations. Respondent did not contest the allegations of violation or corrective\nmeasures, and paid the proposed civil penalty on November 3, 2020.\nBased upon a review of all of the evidence, pursuant to § 190.213, I find Respondent violated the\npipeline safety regulations listed below, as more fully described in the enclosed Notice, which is\nincorporated by reference:\n49 C.F.R. § 192.167(a)(4)(ii) (Item 1) ─ Respondent failed to failed to provide\noperable emergency shutdown (ESD) systems in at least two locations, each of\nwhich was outside the gas area of the compressor station and near the exit gates of\nthe fenced stations;\n49 C.F.R. § 192.709(c) (Item 3) ─ Respondent failed to retain records of each\npatrol, survey, inspection, and test required by subpart M of Part 192 for at least 5\nyears or until the next patrol, survey, inspection, or test is completed, or\nwhichever is longer;\n49 C.F.R. § 192.745(a) (Item 4) ─ Respondent failed to inspect and partially\noperate transmission line valves that might be required during an emergency at\nintervals not exceeding 15 months, but at least once each calendar year; and\n49 C.F.R. § 192.937(b) (Item 6) ─ Respondent failed to follow its integrity\nmanagement plan for performing a continual process of evaluation and\nassessment to maintain its pipeline integrity.\n\n\n\nCPF No. 3-2020-1005\nPage 2\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent. In accordance with 49 C.F.R. § 190.223, Respondent is\nassessed the proposed civil penalty amount of $226,500, which Respondent has already paid in\nfull.\nCOMPLIANCE ACTIONS\nPursuant to 49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217, Respondent is ordered to take the\nactions proposed in the enclosed Notice to correct the violations. The Director may grant an\nextension of time to comply with any of the required items upon a written request timely\nsubmitted by the Respondent and demonstrating good cause for an extension. Upon completion\nof ordered actions, Respondent may request that the Director close the case. Failure to comply\nwith this Order may result in the assessment of civil penalties under 49 C.F.R. § 190.223 or in\nreferral to the Attorney General for appropriate relief in a district court of the United States.\nWARNING ITEMS\nWith respect to Items 2 and 5, the Notice alleged probable violations of 49 C.F.R. §§\n192.605(b)(3) and 192.905(c), respectively, but did not propose a civil penalty or compliance\norder for these items. Therefore, these are considered to be warning items. If OPS finds a\nviolation of any of these items in a subsequent inspection, Respondent may be subject to future\nenforcement action.\nThe terms and conditions of this order are effective upon service in accordance with 49 C.F.R.\n§ 190.5.\nDecember 4, 2020\n___________________________________ _________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety\n\n320201005_Closure Letter_12102020_text.pdf\n\nVIA ELECTRONIC MAIL TO: Mathew.Ramsey@energytransfer.com,\nEric.Amundsen@energytransfer.com, and Jim.Wright@energytransfer.com\nDecember 10, 2020\nMr. Matthew Ramsey\nChief Operating Officer\nEnergy Transfer\n8111 Westchester Drive\nDallas, Texas 75225\nRe: CPF 3-2020-1005\nDear Mr.Ramsey:\nOn December 4, 2020, the Pipeline and Hazardous Materials Administration (PHMSA) issued to\nPanhandle Eastern Pipeline Company, LP, a Final Order in the above referenced case. This\nOrder included a Compliance Order and Civil Penalty assessment. Based on our review of the\ndocumentation provided and confirmation of payment of the civil penalty, it has been determined\nthat you have complied with the terms of the Order.\nThis letter is to inform you no further action is necessary and this case is now closed. Thank you\nfor your cooperation.\nSincerely,\nGregory A. Ochs\nDirector, Central Region, OPS\nPipeline and Hazardous Materials Safety Administration\ncc: Mr. Eric Amundsen, Senior Vice President, Energy Transfer, dba Panhandle Eastern\nPipeline Company, 1300 Main Street, Houston, TX 77002 Eric.Amundsen@energytransfer.com\nJim Wright, Chief Compliance Officer and EVP Legal, Energy Transfer,\nJim.Wright@energytransfer.com\n\n320201005_NOPV PCP PCO_09092020_text.pdf\n\nNOTICE OF PROBABLE VIOLATION\nPROPOSED CIVIL PENALTY\nand\nPROPOSED COMPLIANCE ORDER\nVIA ELECTRONIC MAIL TO: kelcy.warren@energytransfer.com ,\nryan.coffey@energytransfer.com and Eric.Amundsen@energytransfer.com\nSeptember 9, 2020\nMr. Kelcy Warren\nChief Executive Officer\nEnergy Transfer, LP\n8111 Westchester Drive\nDallas, Texas 75225\nCPF 3-2020-1005\nDear Mr. Warren:\nOn various dates from March 4, 2019 through September 20, 2019, representatives of the Pipeline\nand Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),\npursuant to Chapter 601 of 49 United States Code (U.S.C.), inspected your Panhandle Eastern\nPipeline Company (PEPL) records and procedures in Houston, Texas and conducted records,\nfacilities, and right of way inspections in Oklahoma, Kansas, Missouri, and Illinois.\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 (CFR). The items inspected\nand the probable violations are:\n\n\n\n1. 2. §192.167 Compressor stations: Emergency shutdown.\n(a) Except for unattended field compressor stations of 1,000 horsepower (746\nkilowatts) or less, each compressor station must have an emergency shutdown\nsystem that meets the following:\n(1) . . .\n(4) It must be operable from at least two locations, each of which is:\n(i) (ii) Outside the gas area of the station;\nNear the exit gates, if the station is fenced, or near the\nemergency exits, if not fenced; and\n(iii) Not more than 500 feet (153 meters) from the limits of the\nstation\nPEPL failed to provide operable emergency shutdown (ESD) systems in at least two\nlocations, each of which was outside the gas area of the compressor station and near the\nexit gates of the fenced stations as required by §192.167(a)(4)(ii). PEPL’s Olpe\ncompressor station had new units installed after 1970 and therefore, PEPL, which is\ncurrently fenced in, should have modified the ESD system to meet the requirements of\nhaving two ESD switches outside the gas area near the exit gates. During PHMSA’s\ninspection of the Olpe compressor station, the inspectors observed one of the ESD\nswitches located near a vehicle gate that was kept open during occupation and had a\nnearby man gate that could be opened with a crash bar, and the other ESD switch was\nlocated near a vehicle gate that was kept locked and had no man gate nearby. The\nlocation of these ESDs were not compliant with §192.167(a)(4)(ii) because one the ESDs\nwas not located near an exit gate, and instead, by a vehicle gate that was locked.\nTherefore, PEPL is in violation of §192.167(a)(4)(ii) because it failed to have ESDs in at\nleast two locations at the Olpe compressor station, each of which was outside the gas area\nof the fenced in station and near the exit gates.\n§192.605 Procedural manual for operations, maintenance, and emergencies\n(a) . . .\n(b) Maintenance and normal operations. The manual required by paragraph (a) of\nthis section must include procedures for the following, if applicable, to provide\nsafety during maintenance and operations.\n(1) . . .\n(3) Making construction records, maps, and operating history available to\nappropriate operating personnel.\nPEPL failed to follow its operation and maintenance (O&M) manual to ensure it made\navailable accurate maps to appropriate operating personnel. During the inspection,\nPHMSA inspectors observed that the field maps and the electronic database that PEPL\nmade available to field employees had incorrect mapping at four locations.\n2\n\n\n\n3. Two major inaccuracies were indentified on PEPL’s mapping records. First, PEPL’s map\nshowed over half of the Preston lateral, which is approximately 2 miles long, was located\non the wrong side of the road. Second, PEPL’s map for the Bowling Green lateral, which\nwas less in length than the Preston lateral, showed a pipeline crossing to the west side of\nthe road that stayed there for a few hundred feet before returning to the east side of the\nroad. However, the Preston lateral never crossed the road in this area as shown when\nPEPL located the line during the field inspection.\nAdditionally, two minor inaccuracies were also identified on PEPL’s mapping records for\nthe Windsor lateral. PEPL’s mapping record did not reflect that the pipeline had been\nrerouted to maintain distance from a shop that was constructed by the land owner, and at\na location known as Bison Station, associated piping being had been removed.\nFurthermore, the new pipe laid to reconnect the pipeline was not added to the maps.\n§192.709 Transmission lines: Record keeping.\n(a) . . .\n(c) A record of each patrol, survey, inspection, and test required by subparts L and\nM of this part must be retained for at least 5 years or until the next patrol,\nsurvey, inspection, or test is completed, whichever is longer.\nPEPL failed to retain records of each patrol, survey, inspection, and test required by\nsubpart M of part 192 for at least 5 years or until the next patrol, survey, inspection, or\ntest is completed, or whichever is longer. Specifically, PEPL failed to retain records\nshowing inspection and testing of pressure-limiting and regulating stations completed in\n2017 per requirements of §192.739(a) for the Guymon Hansford Unit and Liberal (DCP)\nUnit.\nDuring the inspection, PEPL was unable to produce the 2017 inspection and testing\nrecords for 78 pressure limiting and regulating devices at these locations. PEPL\nexplained that a contractor was used to perform relief valve and regulating station\ninspections and testing, but the contracting company went out of business and the records\nof their work completed for the year 2017 could not be obtained by PEPL. The only\nrecords that PEPL could produce were records for the work performed prior to 2017 and\nan invoice for work completed in the year 2017. Therefore, PEPL failed to retain\ninspection and test records for pressure-limiting and regulating devices for at least five\nyears as required by §192.706(c).\n3\n\n\n\n4. 5. §192.745 Valve maintenance: Transmission lines.\n(a) Each transmission line valve that might be required during any emergency must\nbe inspected and partially operated at intervals not exceeding 15 months, but at\nleast once each calendar year.\nPEPL failed to inspect and partially operate transmission line valves that might be\nrequired during an emergency at intervals not exceeding 15 months, but at least once\neach calendar year. PHMSA inspectors identified during the records inspection that in\nthe Guymon/Hansford Area (Unit 18904), there were 80 valves which were not inspected\nat least once each calendar year. Specifically, these 80 valves, which PEPL recorded as\nbeing DOT regulated, which means requiring to be inspected per §192.745 because they\nmight be required during an emergency, were not inspected during calendar year 2017.\nAdditionally, PHMSA inspectors identified that 35 similar valves in the\nLiberal(DCP)/Satanta (Unit 82882) were not inspected within the 15-month inspection\ninterval from 2016 to 2018. PEPL was the owner of these pipelines from 2016 to 2018,\nwith DCP providing operations and maintenances activities in which 115 transmission\nvalves failed to meet the regulatory requirements.\n§192.905 How does an operator identify a high consequence area?\n(a) . . .\n(c) Newly identified areas. When an operator has information that the area around\na pipeline segment not previously identified as a high consequence area could\nsatisfy any of the definitions in § 192.903, the operator must complete the\nevaluation using method (1) or (2). If the segment is determined to meet the\ndefinition as a high consequence area, it must be incorporated into the\noperator’s baseline assessment plan as a high consequence area within one year\nfrom the date the area is identified.\nPEPL failed to complete an evaluation to identify a high consequence area (HCA) using\nmethod (1) or (2) from the definition of “High Consequence Area” contained in §192.903\nwhen PEPL had information that the area around a pipeline segment not previously\nidentified as an HCA could satisfy any of the definitions in § 192.903. Specifically,\nPEPL did not act upon new information in an area that was not previously identified as a\nHCA. On July 13, 2007, PEPL personnel investigated a fireworks store that was built\n230 feet from its pipeline, adjacent to the right-of-way, and found the store to have an\noccupancy of 3 people, 6 days a week, for 52 weeks per year. Since the initial\nassessment in 2007, the business expanded three times. The store expanded parallel to the\npipeline in 2011 and again in 2014. In 2017, the store expanded from the back of the\nbusiness toward the pipeline. Aerial imagery shows the expansions. However, during the\ninspection, PEPL was unable to produce any records confirming it performed an\nevaluation to determine if the segment met the definition of HCA.\n4\n\n\n\nIn October 2019, after PHMSA inspectors inquired about PEPL’s knowledge of this\nbusiness’ expansion, and whether PEPL completed an evaluation under §192.905(c),\nPEPL personnel contacted the store and received new information. The store was found\nto have at least 21 people, 7 days a week for approximately 8.5 weeks per year, with less\nthan 10 people per day for the rest of the year. Although this new information did not\nmeet the definition of an HCA, PEPL failed to follow-up on information received from\npatrolling and other notifications to perform the required evaluation under §192.905(c).\n6. §192.937 What is a continual process of evaluation and assessment to maintain a\npipeline's integrity?\n(a) . . .\n(b) Evaluation. An operator must conduct a periodic evaluation as frequently as\nneeded to assure the integrity of each covered segment. The periodic evaluation\nmust be based on a data integration and risk assessment of the entire pipeline as\nspecified in §192.917. For plastic transmission pipelines, the periodic evaluation\nis based on the threat analysis specified in §192.917(d) For all other transmission\npipelines, the evaluation must consider the past and present integrity assessment\nresults, data integration and risk assessment information (§192.917), and\ndecisions about remediation (§ 192.933)and additional preventive and mitigative\nactions (§ 192.935).An operator must use the results from this evaluation to\nidentify the threats specific to each covered segment and the risk represented by\nthese threats.\nPEPL failed to follow its integrity management plan for performing a continual process\nof evaluation and assessment to maintain its pipeline integrity. As part of its periodic\nevaluation, PEPL’s Integrity Management Plan Section 5.1 states: “Risk Assessment is\nrun annually on each HCA-managed segment to capture year -to-year changes in\noperation, maintenance, and integrity-related activities.” PEPL failed to run its risk\nmodel yearly in 2017 and 2018. The last record of risk model results was for 2016.\nProposed Civil Penalty\nUnder 49 U.S.C. § 60122 and 49 CFR § 190.223, you are subject to a civil penalty not to exceed\n$218,647 per violation per day the violation persists, up to a maximum of $2,186,465 for a\nrelated series of violations. For violations occurring on or after November 27, 2018 and before\nJuly 31, 2019, the maximum penalty may not exceed $213,268 per violation per day, with a\nmaximum penalty not to exceed $2,132,679. For violations occurring on or after November 2,\n2015 and before November 27, 2018, the maximum penalty may not exceed $209,002 per\nviolation per day, with a maximum penalty not to exceed $2,090,022. For violations occurring\nprior to November 2, 2015, the maximum penalty may not exceed $200,000 per violation per\n5\n\n\n\nday, with a maximum penalty not to exceed $2,000,000 for a related series of violations. We\nhave reviewed the circumstances and supporting documentation involved for the above probable\nviolations and recommend that you be preliminarily assessed a civil penalty of $226,500 as\nfollows:\nItem number\nPENALTY\nItem 3\nItem 4\nItem 6\n$ 20,400\n$145,000\n$ 61,100\nWarning Items\nWith respect to items 2 and 5, we have reviewed the circumstances and supporting documents\ninvolved in this case and have decided not to conduct additional enforcement action or penalty\nassessment proceedings at this time. We advise you to promptly correct these items. Failure to\ndo so may result in additional enforcement action.\nProposed Compliance Order\nWith respect to items 1 and 6, pursuant to 49 U.S.C. § 60118, the Pipeline and Hazardous\nMaterials Safety Administration proposes to issue a Compliance Order to Panhandle Eastern\nPipeline Company. Please refer to the Proposed Compliance Order, which is enclosed and made\na part of this Notice.\nResponse to this Notice\nEnclosed as part of this Notice is a document entitled Response Options for Pipeline Operators\nin Enforcement Proceedings. Please refer to this document and note the response options. All\nmaterial you submit in response to this enforcement action may be made publicly available. If\nyou believe that any portion of your responsive material qualifies for confidential treatment\nunder 5 U.S.C. 552(b), along with the complete original document you must provide a second\ncopy of the document with the portions you believe qualify for confidential treatment redacted\nand an explanation of why you believe the redacted information qualifies for confidential\ntreatment under 5 U.S.C. 552(b).\nFollowing the receipt of this Notice, you have 30 days to submit written comments, or request a\nhearing under 49 CFR § 190.211. If you do not respond within 30 days of receipt of this Notice,\nthis constitutes 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 further\nnotice to you and to issue a Final Order. If you are responding to this Notice, we propose that\nyou submit your correspondence to my office within 30 days from receipt of this Notice. This\nperiod may be extended by written request for good cause.\nIn your correspondence on this matter, please refer to CPF 3-2020-1005 and, for each document\nyou submit, please provide a copy in electronic format whenever possible.\n6\n\n\n\nSincerely,\nWilliam I. Rush\nActing Director, Central Region, OPS\nPipeline and Hazardous Materials Safety Administration\nEnclosures: Proposed Compliance Order\nResponse Options for Pipeline Operators in Enforcement Proceedings\ncc: Mr. Ryan Coffey, Executive Vice President, Operations,Energy Transfer, dba Panhandle\nEastern Pipeline Company, 800 E. Sonterra Blvd. #400, San Antonio, TX 78258\nryan.coffey@energytransfer.com\nMr. Eric Amundsen, Senior Vice President, Energy Transfer, dba Panhandle Eastern\nPipeline Company, 1300 Main Street, Houston, TX 77002,\nEric.Amundsen@energytransfer.com\n7\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 Panhandle Eastern Pipe Line Company (PEPL) a\nCompliance Order incorporating the following remedial requirements to ensure the compliance\nof PEPL with the pipeline safety regulations:\n1. 2. 3. 4. In regard to Item 1 of the Notice pertaining to the location of emergency\nshutdowns at the Olpe compressor station, PEPL must install or otherwise make\nprovisions for an exit gate near ESD #3 that meets the requirements in\n§192.163(d).\nIn regard to Item 6 of the Notice pertaining to PEPL’s failure to run its risk model\nyearly as required by its procedures, PEPL must run its risk model and integrate\nthe results so it can track its year to year changes.\nPEPL must complete the requirements of Items 1 and 2 of the Complianc Order\nwithin 90 days of receipt of a final order and provide documentation to Director,\nCentral Region, OPS Pipeline and Hazardous Materials Safety Administration.\nIt is requested (not mandated) that PEPL maintain documentation of the safety\nimprovement costs associated with fulfilling this Compliance Order and submit\nthe total to Director, Central Region, Pipeline and Hazardous Materials Safety\nAdministration. It is requested that these costs be reported in two categories: 1)\ntotal cost associated with preparation/revision of plans, procedures, studies and\nanalyses, and 2) total cost associated with replacements, additions and other\nchanges to pipeline infrastructure.\n8","truncated":false,"body_characters":24323}