{"operation":"document","citation":"CPF 320205020","title":"SINCLAIR TRANSPORTATION COMPANY — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2020-10-13","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.260(e), 195.412(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-320205020.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-320205020.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-320205020","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/320205020","body":"Notice of Probable Violation involving SINCLAIR TRANSPORTATION COMPANY. PHMSA's enforcement data identifies the cited regulations as 195.260(e),  195.412(a). The case was opened on 2020-10-13 and is reported as closed as of 2021-02-24. Proposed civil penalty: $97,100. Assessed civil penalty: $67,700. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n320205020_Closure Letter_02242021.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320205020/320205020_Closure%20Letter_02242021.pdf\n\n320205020_Closure Letter_02242021_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320205020/320205020_Closure%20Letter_02242021_text.pdf\n\n320205020_Consent Agreement and Order_02052021.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320205020/320205020_Consent%20Agreement%20and%20Order_02052021.pdf\n\n320205020_Consent Agreement and Order_02052021_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320205020/320205020_Consent%20Agreement%20and%20Order_02052021_text.pdf\n\n320205020_NOPV PCP PCO_10132020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320205020/320205020_NOPV%20PCP%20PCO_10132020.pdf\n\n320205020_NOPV PCP PCO_10132020_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320205020/320205020_NOPV%20PCP%20PCO_10132020_text.pdf\n\n320205020_Operator Response to Notice and Request for Hearing and Request for Case File_11022020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320205020/320205020_Operator%20Response%20to%20Notice%20and%20Request%20for%20Hearing%20and%20Request%20for%20Case%20File_11022020.pdf\n\n320205020_Closure Letter_02242021_text.pdf\n\nVIA ELECTRONIC MAIL TO: mpetersen@sinclairoil.com and jbrown@sinclairoil.com\nFebruary 24, 2021\nMr. Mark Peterson\nPresident\nSinclair Transportation Company\n550 East South Temple\nSalt Lake City, Utah 84102\nRe: CPF 3-2020-5020\nDear Mr. Peterson:\nOn February 5, 2021, the Pipeline and Hazardous Materials Safety Administration (PHMSA)\nissued to Sinclair Transportation Company a Consent Order in the above-referenced case. This\nOrder included a Consent Agreement and Civil Penalty assessment. Based on our review of the\ndocumentation you provided and confirmation of payment of the civil penalty, it has been\ndetermined that you have complied with the terms of this Order.\nAccordingly, this case is now closed and no further action is contemplated with respect to the\nmatters involved in this case. Thank you for your cooperation in this matter.\nSincerely,\nGregory Ochs\nDirector, Central Region, OPS\nPipeline and Hazardous Materials Safety Administration\n\n320205020_NOPV PCP PCO_10132020_text.pdf\n\nNOTICE OF PROBABLE VIOLATION\nPROPOSED CIVIL PENALTY\nand\nPROPOSED COMPLIANCE ORDER\nVIA ELECTRONIC MAIL TO: mpetersen@sinclairoil.com and jbrown@sinclairoil.com\nOctober 13, 2020\nMr. Mark Petersen\nPresident\nSinclair Transportation Company\n550 East South Temple\nSalt Lake City, Utah 84102\nmpetersen@sinclairoil.com\nCPF 3-2020-5020\nDear Mr. Petersen:\nFrom April 4, 2019 to September 24, 2019, representatives of the Pipeline and Hazardous\nMaterials Safety Administration (PHMSA), Office of Pipeline Safety (OPS), pursuant to Chapter\n601 of 49 United States Code (U.S.C.), inspected records and field facilities of Sinclair\nTranportation Company’s (Sinclair) refined products Midcon system in Kansas, Missouri, and\nIowa.\nAs a result of the inspection, it is alleged that Sinclair has committed probable violations of the\nPipeline Safety Regulations, Title 49, Code of Federal Regulations (CFR). The items inspected\nand the probable violations are:\n1. §195.260 Valves: Location. A valve must be installed at each of the following\nlocations:\n\n\n\n(a) . . .\n(e) On each side of a water crossing that is more than 100 feet (30 meters) wide\nfrom high-water mark to high-water mark unless the Administrator finds in a\nparticular case that valves are not justified.\nSinclair failed to install valves on each side of a water crossing this is more than 100 feet wide\nfrom high-water mark to high-water mark. In 2011 Sinclair installed a new crossing of more\nthan 100 feet on Santa Fe Lake near Laplata, Missouri, but did not install the valves required by\n§195.260(e). PHMSA reviewed the project files and inspected the area during the inspection to\nconfirm the required valves to protect the lake crossing had not been installed.\n2. §195.412 Inspection of rights-of-way and crossings under navigable waters\n(a) Each operator shall, at intervals not exceeding 3 weeks, but at least 26 times each\ncalendar year, inspect the surface conditions on or adjacent to each pipeline right-\nof-way. Methods of inspection include walking, driving, flying or other appropriate\nmeans of traversing the right-of-way.\nSinclair failed to inspect the surface conditions on or adjacent to each pipeline right-of-way\n(ROW). Sinclair conducted the inspections required by §195.412(a) by aerial patrol, however, it\nfailed to maintain the pipeline ROW in a condition that is appropriate for aerial patrolling to\ninspect the surface conditions on or adjacent to each pipeline ROW. PHMSA’s field inspection\nobserved tree canopy and vegetation cover over the ROW, which precluded Sinclair from\ninspecting the surface conditions at the following locations by aerial patrol:\n• ROW to the west of the Hwy 218 crossing south of Montrose, IA\n• ROW on Sessford Property west of Argyle, IA\n• ROW approximately 0.5 miles east of Gorin, MO\n• ROW between Hwy 139 and Maple St, Bosworth, MO\n• ROW on the west side of the North Missouri River block valve\n• ROW on both sides of Robinson Pike Rd, Grandview, MO\n• ROW north of 3rd St in Grandview, MO\n• ROW on both sides of Martha Truman Rd , Grandview, MO\n• ROW on Burr Oak Woods Nature Center, (Missouri Conservation Department property)\nnorth of the South Burr Oak Woods Block Valve\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 violation 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 violation occurring on or after November 2,\n2\n\n\n\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\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 have recommended that you be preliminarily assessed a civil penalty of $97,100\nas follows:\nItem number PENALTY\n2 $97,100\nProposed Compliance Order\nWith respect to items 1 and 2, pursuant to 49 U.S.C. § 60118, the Pipeline and Hazardous\nMaterials Safety Administration proposes to issue a Compliance Order to Sinclair Transporation\nCompany. Please refer to the Proposed Compliance Order, which is enclosed and made a part of\nthis 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 3-2020-5020 and, for each document\nyou submit, please provide a copy in electronic format whenever possible.\n3\n\n\n\nSincerely,\nGregory A. Ochs\nDirector, Central Region, OPS\nPipeline and Hazardous Materials Safety Administration\nEnclosures: Proposed Compliance Order\nResponse Options for Pipeline Operators in Enforcement Proceedings\nCc: Jon Brown, Regulatory Compliance Coordiantor, jbrown@sinclairoil.com\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 Sinclair Transportation Company (Sinclair) a\nCompliance Order incorporating the following remedial requirements to ensure the compliance\nof Sinclair with the pipeline safety regulations:\n1. 2. 3. In regard to Item Number 1 of the Notice pertaining to Sinclair’s failure install\nvalves on each side of the water crossing of Sante Fe Lake outside of Laplata, MO\nas required by §195.260(e), Sinclair must complete the following measures:\na. Within 30 days of the issuance of the Final Order: assess the location of\nthe valves and update the Emergency Flow Restricing Devices study as\nneeded to identify the location of any additional valves required to protect\nthe Sante Fe Lake crossing.\nb. Within 90 days of the issuance of the Final Order: provide to the Director,\nCentral Region, a plan and schedule to complete the installation of the\nvalves required to protect Sante Fe Lake with the following requirements:\ni. Peform the installation of required valves within 12 months; and\nii. Provide to the Director quarterly progress reports and a final report\nupon completed of the installation of required valves.\nIn regard to Item Number 2 of the Notice pertaining to Sinclair’s failure to inspect\nthe surface conditions on or adjacent to each pipeline right-of-way as required by\n§195.412(a), Sinclair must complete the following measures:\na. Within 30 days of the issuance of the Final Order: assess the right-of-way to\ndetermine which locations require clearing to allow for effective aerial patrols\nor establish alternate effective patrols for those locations where clearing will\nnot be conducted.\nb. Within 90 days of issuance of the Final Order: provide to the Director, Central\nRegion, a plan and schedule to complete the identified right-of-way clearing\nand records of the completed patrols with the following requirements:\ni. Complete all necessary clearing within 12 months; and\nii. Provide to the Director quarterly progress reports and a final report\nupon completion of all planned right-of-way clearing.\nIt is requested (not mandated) that Sinclair maintain documentation of the safety\nimprovement costs associated with fulfilling this Compliance Order and submit\nthe total to Allan Beshore, Director, Central Region, Pipeline and Hazardous\nMaterials Safety Administration. It is requested that these costs be reported in\ntwo categories: 1) total cost associated with preparation/revision of plans,\nprocedures, studies and analyses, and 2) total cost associated with replacements,\nadditions and other changes to pipeline infrastructure.\n5\n\n320205020_Consent Agreement and Order_02052021_text.pdf\n\nFebruary 5, 2021\nVIA ELECTRONIC MAIL TO: mpetersen@sinclairoil.com\nMr. Mark Peterson\nPresident\nSinclair Transportation Company\n550 East South Temple\nSalt Lake City, Utah 84102\nCPF No. 3-2020-5020\nDear Mr. Peterson:\nEnclosed please find a Consent Order incorporating the terms of the Consent Agreement between\nthe Pipeline and Hazardous Materials Safety Administration (PHMSA) and Sinclair\nTransportation Company which was executed on January 4 and January 17, 2021, respectively.\nService of the Consent Order and Consent Agreement by electronic mail is deemed effective upon\nthe date of transmission, or as otherwise 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: Order and Consent Agreement\ncc: Mr. Gregory Ochs, Director, Central Region, Office of Pipeline Safety, PHMSA\nMr. Jon S. Lindsey, Corporate Counsel, Sinclair Transportation Company,\njlindsey@sinclairoil.com\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\nSinclair Transportation Company,\nRespondent.\n)\n)\n)\n)\n)\n)\n)\nCPF No. 3-2020-5020\nCONSENT ORDER\nBy letter dated October 13, 2020, the Pipeline and Hazardous Materials Safety Administration,\nOffice of Pipeline Safety, issued a Notice of Probable Violation, Proposed Civil Penalty and\nProposed Compliance Order (Notice) to Sinclair Transportation Company (Sinclair).\nIn response to the Notice, Sinclair requested an informal consultation, whereupon the parties\nengaged in good-faith settlement discussions that have resulted in the Consent Agreement\nattached to this Order that settles all of the allegations in the Notice.\nAccordingly, the Consent Agreement is hereby approved and incorporated by reference into this\nOrder. FLNG is hereby ordered to comply with the terms of the Consent Agreement, effective\nimmediately.\nPursuant to 49 U.S.C. 60101, et seq., failure to comply with this Consent Order may result in the\nassessment of civil penalties as set forth in 49 C.F.R. § 190.223.\nThe terms and conditions of this Consent Order are effective upon service in accordance with 49\nC.F.R. § 190.5.\nFebruary 5, 2021\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety\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\nSinclair Transportation Company,\nRespondent.\n)\n)\n)\n)\n)\n)\n)\nCPF No. 3-2020-5020\nCONSENT AGREEMENT\nFrom April 4, 2019, to September 24, 2019, pursuant to 49 U.S.C. § 60117, representatives 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 Sinclair\nTransportation Company’s (Sinclair or Respondent) refined-products Midcon system in Kansas,\nMissouri, and Iowa.\nAs a result of the inspection, the Director, Central Region, OPS (Director), issued to Respondent,\nby letter dated October 13, 2020, 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 Sinclair had violated 49 C.F.R. §§ 195.260(e) and 195.412(a), and\nproposed ordering Respondent to take certain measures to correct the alleged violations, and to\npay a civil penalty in the amount of $97,100.\nSinclair responded to the Notice by letter dated November 2, 2020 (Response). The company\ncontested the allegations and requesting a hearing. On November 13, 2020, Sinclair and\nPHMSA (collectively, the Parties), participated in a scheduling conference with the presiding\nofficial. During the conference, the Parties agreed that the issues in the Notice could potentially\nbe resolved through informal discussions. On December 2, 2020, and again on December 16,\n2020, the Parties met to discuss a possible resolution of the case. During each meeting, both\nParties offered additional information in response to the Notice, and an agreement was reached\nthat resolves all of the issues in the Notice.\nHaving agreed that settlement of this proceeding will avoid further administrative proceedings or\nlitigation and will serve the public interest by promoting safety and protection of the\nenvironment, pursuant to 49 C.F.R. Part 190, and upon consent and agreement of the Sinclair and\nPHMSA, the Parties hereby agree as follows:\n\n\n\nI. General Provisions\n1. Respondent acknowledges that as the operator of the Midcon system in Kansas,\nMissouri, and Iowa, Respondent and its Midcon system are subject to the jurisdiction of the\nFederal pipeline safety laws, 49 U.S.C. § 60101, et seq., and the regulations and administrative\norders issued thereunder. For purposes of this Agreement, Respondent acknowledges that it\nreceived proper notice of PHMSA's action in this proceeding and that the Notice states claims\nupon which relief may be granted pursuant to 49 U.S.C. 60101, et seq., and the regulations and\norders issued thereunder.\n2. After Sinclair returns this signed Agreement to PHMSA, the Agency’s\nrepresentative will present it to the Associate Administrator for Pipeline Safety, recommending\nthat the Associate Administrator adopt the terms of this Agreement by issuing an administrative\norder (Consent Order) incorporating the terms of this Agreement. The terms of this Agreement\nconstitute an offer of settlement until accepted by the Associate Administrator. Once accepted,\nthe Associate Administrator will issue a Consent Order incorporating the terms of this Agreement\n3. Respondent consents to the issuance of the Consent Order, and hereby waives any\nfurther procedural requirements with respect to its issuance. Respondent waives all rights to\ncontest the adequacy of notice, or the validity of the Consent Order or this Agreement, including\nall rights to administrative or judicial hearings or appeals, except as set forth herein.\n4. This Agreement shall apply to and be binding upon PHMSA and Sinclair, its\nofficers, directors, and employees, and its successors, assigns, or other entities or persons\notherwise bound by law. Respondent agrees to provide a copy of this Agreement and any\nincorporated work plans and schedules to all of Sinclair’s officers, employees, and agents whose\nduties might reasonably include compliance with this Agreement.\n5. This Agreement constitutes the final, complete and exclusive agreement and\nunderstanding between the Parties with respect to the settlement embodied in this Agreement.\nThe Parties acknowledge that there are no representations, agreements or understandings relating\nto settlement other than those expressly contained in this Agreement, except that the terms of this\nAgreement may be construed by reference to the Notice.\n6. Nothing in this Agreement affects or relieves Respondent of its responsibility to\ncomply with all applicable requirements of the Federal pipeline safety laws, 49 U.S.C. § 60101, et\nseq., and the regulations and orders issued thereunder. Nothing in this Agreement alters\nPHMSA's right of access, entry, inspection, and information gathering or PHMSA's authority to\nbring enforcement actions against Sinclair pursuant to the Federal pipeline safety laws, the\nregulations and orders issued thereunder, or any other provision of Federal or State law.\n7. For all transfers of ownership or operating responsibility of Sinclair’s Midcon\npipeline system, Sinclair will provide a copy of this Agreement to the prospective transferee at\nleast 30 days prior to such transfer. Sinclair will provide written notice of the transfer to the\nPHMSA Central Regional Director no later than 60 days after the transfer occurs.\n\n\n\n8. This Agreement does not waive or modify any Federal, State, or local laws or\nregulations that are applicable to Respondent’s pipeline systems. This Agreement is not a permit,\nor a modification of any permit, under any Federal, State, or local laws or regulations. Sinclair\nremains responsible for achieving and maintaining compliance with all applicable Federal, State,\nand local laws, regulations and permits.\n9. This Agreement does not create rights in, or grant any cause of action to, any third\nparty not party to this Agreement. The U.S. Department of Transportation is not liable for any\ninjuries or damages to persons or property arising from acts or omissions of Respondent or its\nofficers, employees, or agents carrying out the work required by this Agreement. Sinclair agrees\nto hold harmless the U.S. Department of Transportation, its officers, employees, agents, and\nrepresentatives from any and all causes of action arising from any acts or omissions of\nRespondent or its contractors in carrying out any work required by this Agreement.\n10. Upon issuance of the Consent Order, the Parties agree to the following terms.\nII. Item 1 of the Notice:\n12. Allegation of Violation - § 195.260(e): With respect to Item 1 of the Notice, the\nDirector, Central Region, has reviewed additional information provided by Sinclair and\ndetermined that this Item should be reduced to a warning item. Sinclair provided PHMSA with an\nEmergency Flow Restricting Device (EFRD) study that supported Sinclair’s contention that the\nlocation of the valves are consistent with the requirements of the regulation. As such, the allegation\nof violation for Item 1 and the related compliance order associated with this Item are withdrawn.\nIII. Item 2 of the Notice:\n13. Allegation of Violation - § 195.412(a): With respect to Item 2 of the Notice, the\nParties agree that Sinclair violated 49 C.F.R. § 195.412(a), as alleged in the Notice, for four of\nthe nine instances of violation alleged and shall be considered by PHMSA as a prior offense in\nany future PHMSA enforcement action taken against Sinclair. In addition, the Director, Central\nRegion has reviewed additional documentation provided by Sinclair and has determined that\nSinclair has completed the corrective action detailed in the Proposed Compliance Order of the\nNotice. Accordingly, the compliance order associated with this Item is withdrawn.\n14. Civil Penalty: With respect to Item 2 of the Notice, the Parties agree that the\nCivil Penalty is reduced from $97,100 to $67,700. The reduction the civil penalty is supported\nby the reduction in instances of violation from nine to four. Sinclair must pay the civil penalty in\nthe amount of $67,700 no later than 30 days from the Effective Date of this Agreement.\nIV. Enforcement\n15. This Agreement is subject to all enforcement authorities available to PHMSA\nunder 49 U.S.C. § 60101, et seq., and 49 C.F.R. Part 190, including administrative civil penalties\nunder 49 U.S.C. § 60122, of up to $200,000 per violation for each day the violation continues and\nreferral of the case to the Attorney General for judicial enforcement, if PHMSA determines that\nRespondent is not complying with the terms of this Agreement in accordance with determinations\n\n\n\nmade by the Director, or if appealed, in accordance with decisions of the Associate Administrator.\nThe maximum civil penalty amounts are adjusted annually for inflation. See, e.g., Pipeline\nSafety: Inflation Adjustment of Maximum Civil Penalties, 82 Fed. Reg. 19325 (April 27, 2017).\nV. Effective Date\n16. The term “Effective Date,” as used herein, is the date on which the Consent Order\nis issued by the Associate Administrator, PHMSA, incorporating the terms of this Agreement.\nVI. Modification\n17. The terms of this Agreement may be modified by mutual agreement of the Parties.\nSuch modifications must be in writing and signed by both parties.\nVIII. Ratification\n19. The Parties’ undersigned representatives certify that they are fully authorized to\nenter into the terms and conditions of this Agreement and to execute and legally bind such party\nto this document.\n20. The Parties hereby agree to all conditions and terms of this Agreement.\nFor Sinclair Transportation Company:\n___________________________________\n________________________\nDate\nFor PHMSA:\n___________________________________\nRegion Director\nJanuary 4, 2021________________\nDate","truncated":false,"body_characters":24127}