{"operation":"document","citation":"CPF 32021030WL","title":"KOCH FERTILIZER, LLC. — Warning Letter","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2021-04-22","effective_on":null,"summary":"CLOSED warning letter citing 195.234(e)(5), 195.310(a), 195.310(b), 195.403(b), 195.422(b).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-32021030wl.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-32021030wl.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-32021030wl","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/32021030WL","body":"Warning Letter involving KOCH FERTILIZER, LLC.. PHMSA's enforcement data identifies the cited regulations as 195.234(e)(5),  195.310(a),  195.310(b),  195.403(b),  195.422(b). The case was opened on 2021-04-22 and is reported as closed as of 2021-04-22. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n32021030WL_Warning Letter_04222021_(21-210589).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021030WL/32021030WL_Warning%20Letter_04222021_(21-210589).pdf\n\n32021030WL_Warning Letter_04222021_(21-210589)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021030WL/32021030WL_Warning%20Letter_04222021_(21-210589)_text.pdf\n\n32021030WL_Warning Letter_04222021_(21-210589)_text.pdf\n\nWARNING LETTER\nVIA ELECTRONIC MAIL TO: mark.luetters@kochind.com, shawn.kimberly@kochind.com\nApril 22, 2021\nMr. Mark Luetters\nPresident, Koch Ag & Energy Solutions\nH2D\n4111 East 37th Street North\nWichita, KS 67220\nCPF 3-2021-030-WL\nDear Mr. Luetters:\nFrom April 1, 2019 through September 5, 2019, representatives of the Pipeline and Hazardous\nMaterials Safety Administration (PHMSA), Office of Pipeline Safety (OPS), Central Region,\npursuant to Chapter 601 of 49 United States Code (U.S.C.) inspected your Koch NH3 pipeline\nsystem of Koch Fertilizer, LLC (Koch Fertilizer), a subsidiary of Koch Ag & Energy Solutions,\nLLC (KAES), including procedures, facilities, and records and located near Garner, Iowa.\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). PHMSA notes that\nafter the inspection, on or about January 31, 2020, Koch Fertilizer requested to deactivate the\nKoch NH3 assets (OPID 31982) as the facility and associated piping will not be used as a\nbreakout tank jurisdictional to PHMSA. The items inspected and the probable violations are:\n\n\n\n1. § 195.234 Welds: Nondestructive testing.\n(a) . . .\n(e) All girth welds installed each day in the following locations must be\nnondestructively tested over their entire circumference, except that when\nnondestructive testing is impracticable for a girth weld, it need not be tested if\nthe number of girth welds for which testing is impracticable does not exceed 10\npercent of the girth welds installed that day:\n(5) Within populated areas, including, but not limited to, residential\nsubdivisions, shopping centers, schools, designated commercial areas,\nindustrial facilities, public institutions, and places of public assembly.\nKoch Fertilizer failed to nondestructively test all girth welds installed each day associated\nwith the GAR-14-007 pipeline repair project in 2014 and therefore failed to comply with\nthe requirements of § 195.234(e)(5). The Garner facility is an industrial facility.\nProject records for GAR-14-007 indicate that only two welds were nondestructively\ntested even though records and schematics indicate that ten girth welds were associated\nwith the project. This left eight welds that were not nondestructively tested. The records\ndo not clearly indicate which girth welds were non-destructively tested for the project. In\naddition, the operator failed to provide documentation that indicated nondestructive\ntesting (NDT) was impracticable for any portion of this repair project.\nFurther, the NDT records associated with the GAR-14-007 pipe repair project indicate\nthat the NDT was performed under ASME B31.3, not in accordance with API 1104\n(incorporated by reference). ASME B31.3 is not referenced in either 49 CFR Part 195 or\nKoch Fertilizer’s procedure P-195.214.\n2. § 195.310 Records.\n(a) A record must be made of each pressure test required by this subpart, and the\nrecord of the latest test must be retained as long as the facility tested is in use.\n(b) The record required by paragraph (a) of this section must include:\n(1) The pressure recording charts;\n(2) Test instrument calibration data;\n(3) The name of the operator, the name of the person responsible for making\nthe test, and the name of the test company used, if any;\n(4) The date and time of the test;\n(5) The minimum test pressure;\n(6) The test medium;\n2\n\n\n\n(7) A description of the facility tested and the test apparatus;\n(8) An explanation of any pressure discontinuities, including test failures,\nthat appear on the pressure recording charts;\n(9) Where elevation differences in the section under test exceed 100 feet (30\nmeters), a profile of the pipeline that shows the elevation and test sites\nover the entire length of the test section; and\n(10) Temperature of the test medium or pipe during the test period.\nKoch Fertilizer’s pressure test records associated with the December, 2017, pressure tests\nat Garner Terminal failed to comply with the requirements of § 195.310(b). The test\nmedium used to perform pressure tests associated with the 150#, 300#, and 600# test\nsegments was not consistently recorded for each pressure test. In addition, the test\nmedium used to perform pressure tests was not recorded as required in the operator’s\nLiquid Operations & Maintenance Manual procedure, P-195.300 Pressure Test (dated\nDecember 2015).\nThe Hydratight Daily Activity Report records from December 11, 2017, recorded\nbetween 15:00 and 16:30 hours that the test lost pressure and was bled down to check for\nleaks. However, a description of the particular facility being tested at this time was not\nidentified in the records.\nThe 600# system pressure and test log (identified in the file, “Hydro Info.pdf”) with the\ndate of December 13, 2017, recorded a 100 psig pressure drop between 10:00 and 17:45\nwith only a 5-degree Fahrenheit drop in temperature. The Hydratight Daily Activity\nReport for this pressure test indicated at 18:00, “600# fail, depressure to allow contractor\nto retorq everything.” On December 14, 2017, the Hydratight Daily Activity Report\nindicates that a subsequent pressure test for the 600# system was performed, but no\npressure and temperature logs were provided relevant to the 600# system. In addition,\nthe pressure test charts provided for the 600# system did not indicate the date the tests\nwere performed.\n3. §195.403 Emergency response training.\n(a) . . .\n(b) At the intervals not exceeding 15 months, but at least once each calendar year,\neach operator shall:\n(1) Review with personnel their performance in meeting the objectives of the\nemergency response training program set forth in paragraph (a) of this\nsection; and\n(2) Make appropriate changes to the emergency response training program as\nnecessary to ensure that it is effective.\n3\n\n\n\nKoch Fertilizer’s emergency response training records were inadequate and failed to\ncomply with the requirements of § 195.403(b). Records did not indicate that the operator\nreviewed with personnel their performance in meeting the objectives of the emergency\nresponse training program. Further, the records did not document appropriate changes\nwere made as necessary to ensure that the emergency response training program is\neffective.\nSpecifically, records did not exist to substantiate that supervisor or employee training had\noccurred for the following Garner Terminal Emergency Response Plan, Section 12.11\nprocedures:\n12.11. Emergency Operating Procedures\nEOP GARN 07 01 001 Handling Small and Large Ammonia Releases\nEOP GARN 07 01 002 Handling Callouts\nEOP GARN 07 01 003 Handling Chemical Spills\nEOP GARN 07 01 004 Emergency Operation Due to Flare Failure\nEOP GARN 07 01 005 Emergency Operation Due to Loss of SCADA\nEOP GARN 07 01 006 Emergency Operation Due to Electric Power Failure\nEOP GARN 07 01 007 Using a Generator During a Power Failure\nESP GARN 07 01 001 Terminal Emergency Shutdown\nESP GARN 07 01 002 Utility Fuel Gas Small/Major Leak or Fire\nSUP GARN 07 01 003 Startup After a Terminal ESD\nSUP GARN 07 01 001 Startup After a Power Failure\nESP GARN 07 82 001 Truck Loading Bay Emergency Stop\nESP GARN 07 85 001 Reinjection Emergency Shutdown\n4. §195.422 Pipeline repairs.\n(a) . . .\n(b) No operator may use any pipe, valve, or fitting, for replacement in repairing\npipeline facilities, unless it is designed and constructed as required by this part.\nKoch Fertilizer failed to ensure that pipe, valve, or fitting, for replacement in repairing\npipeline facilities was installed as required by § 195.422(b). The pressure test performed\non March 27, 2014, and the associated records for the MOC GAR-14-007 repair project\nwere inadequate.\nSpecifically, the pressure test performed on March 27, 2014, had a duration of only 31\nminutes. This pressure test began at 8:40 a.m. and ended at 9:11 a.m. In addition, the\npressure test records did not record the temperature throughout the test period or the test\n4\n\n\n\nmedium used. Koch Fertilizer continued to operate the piping associated with the 2014\npressure test without proper pressure test documentation between 2014 and 2017.\nUnder 49 U.S.C. § 60122 and 49 CFR § 190.223, you are subject to a civil penalty not to exceed\n$222,504 per violation per day the violation persists, up to a maximum of $2,225,034 for a\nrelated series of violations. For violation occurring on or after July 31, 2019 and before January\n11, 2021, the maximum penalty may not exceed $218,647 per violation per day the violation\npersists, up to a maximum of $2,186,465 for a related series of violations. For violation\noccurring on or after November 27, 2018 and before July 31, 2019, the maximum penalty may\nnot exceed $213,268 per violation per day, with a maximum penalty not to exceed $2,132,679.\nFor violation occurring on or after November 2, 2015 and before November 27, 2018, the\nmaximum penalty may not exceed $209,002 per violation per day, with a maximum penalty not\nto exceed $2,090,022.\nWe have reviewed the circumstances and supporting documents involved in this case, and have\ndecided not to conduct additional enforcement action or penalty assessment proceedings at this\ntime. We advise you to correct the items identified in this letter. Failure to do so will result in\nKoch Fertilizer being subject to additional enforcement action if the facility is reactivated as a\nbreakout tank jurisdictional to PHMSA.\nNo reply to this letter is required. If you choose to reply, in your correspondence please refer to\nCPF 3-2021-30-WL. Be advised that all material you submit in response to this enforcement\naction is subject to being made publicly available. If you believe that any portion of your\nresponsive material qualifies for confidential treatment under 5 U.S.C. 552(b), along with the\ncomplete original document you must provide a second copy of the document with the portions\nyou believe qualify for confidential treatment redacted and an explanation of why you believe\nthe redacted information qualifies for confidential treatment under 5 U.S.C. 552(b).\nSincerely,\nGregory A. Ochs\nDirector, Central Region, OPS\nPipeline and Hazardous Materials Safety Administration\ncc: Shawn Kimberly, VP Operations, shawn.kimberly@kochind.com\n5","truncated":false,"body_characters":10989}