# TALLGRASS PONY EXPRESS PIPELINE, LLC — Notice of Probable Violation - **operation:** document - **citation:** CPF 32021046NOPV - **title:** TALLGRASS PONY EXPRESS PIPELINE, LLC — Notice of Probable Violation - **source type:** enforcement - **agency:** Pipeline and Hazardous Materials Safety Administration - **status:** historical - **official:** true - **published on:** 2021-11-23 - **effective on:** Not available - **summary:** CLOSED notice of probable violation citing 195.310(a), 195.402(a), 195.406(b), 195.440(g), 195.452(b)(4)(i), 195.452(f), 195.452(l)(1)(ii), 195.573(a)(1), 195.573(c), 195.577(a). - **machine formats:** - **json:** https://regulus.evalyn.ai/document/phmsa-enforcement-32021046nopv.json - **markdown:** https://regulus.evalyn.ai/document/phmsa-enforcement-32021046nopv.md - **app url:** https://regulus.evalyn.ai/document/phmsa-enforcement-32021046nopv - **source url:** https://primis.phmsa.dot.gov/enforcement-data/case/32021046NOPV **body:** Notice of Probable Violation involving TALLGRASS PONY EXPRESS PIPELINE, LLC. PHMSA's enforcement data identifies the cited regulations as 195.310(a), 195.402(a), 195.406(b), 195.440(g), 195.452(b)(4)(i), 195.452(f), 195.452(l)(1)(ii), 195.573(a)(1), 195.573(c), 195.577(a). The case was opened on 2021-11-23 and is reported as closed as of 2022-11-03. Proposed civil penalty: $437,300. Assessed civil penalty: $385,500. Open the official case record for notices, responses, orders, and the latest status. Official case documents: 32021046NOPV_Closure Letter_11032022_(20-172259).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_Closure%20Letter_11032022_(20-172259).pdf 32021046NOPV_Closure Letter_11032022_(20-172259)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_Closure%20Letter_11032022_(20-172259)_text.pdf 32021046NOPV_Consent Agreement and Order_05102022_(20-172259).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_Consent%20Agreement%20and%20Order_05102022_(20-172259).pdf 32021046NOPV_Consent Agreement and Order_05102022_(20-172259)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_Consent%20Agreement%20and%20Order_05102022_(20-172259)_text.pdf 32021046NOPV_Op Resp to Notice and Req for Hearing and Statement of Issues (Part 1)_01212022_(20-172259).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_Op%20Resp%20to%20Notice%20and%20Req%20for%20Hearing%20and%20Statement%20of%20Issues%20(Part%201)_01212022_(20-172259).pdf 32021046NOPV_Op Resp to Notice and Req for Hearing and Statement of Issues (Part 2)_01212022_(20-172259).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_Op%20Resp%20to%20Notice%20and%20Req%20for%20Hearing%20and%20Statement%20of%20Issues%20(Part%202)_01212022_(20-172259).pdf 32021046NOPV_PCP PCO_11232021_(20-172259).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_PCP%20PCO_11232021_(20-172259).pdf 32021046NOPV_PCP PCO_11232021_(20-172259)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_PCP%20PCO_11232021_(20-172259)_text.pdf 32021046NOPV_PHC Hearing Canceled_06022022_(20-172259).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_PHC%20Hearing%20Canceled_06022022_(20-172259).pdf 32021046NOPV_PHC Hearing Canceled_06022022_(20-172259)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_PHC%20Hearing%20Canceled_06022022_(20-172259)_text.pdf 32021046NOPV_PHC Hearing Scheduled_02072022_(20-172259).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_PHC%20Hearing%20Scheduled_02072022_(20-172259).pdf 32021046NOPV_PHC Hearing Scheduled_02072022_(20-172259)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021046NOPV/32021046NOPV_PHC%20Hearing%20Scheduled_02072022_(20-172259)_text.pdf 32021046NOPV_Closure Letter_11032022_(20-172259)_text.pdf VIA ELECTRONIC MAIL TO: bill.moler@tallgrassenergylp.com; jennifer.eckels@tallgrassenergylp.com; brad.armsbury@tallgrassenergylp.com; crystal.heter@tallgrassenergylp.com; November 3, 2022 William Moler Chief Executive Officer Tallgrass Pony Express Pipeline, LLC 4200 W. 115th St. Suite 350 Leawood, KS 66211 RE: CPF 3-2021-046-NOPV Dear Mr. Moler: On May 10, 2022, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued a Consent Order incorporating the terms of the Consent Agreement between PHMSA and Tallgrass Pony Express Pipeline, LLC (Tallgrass) in the above-referenced case. This Order included a Civil Penalty assessment and Compliance Order requirement for Tallgrass to take corrective actions on its pipeline. Based on our review of the documentation provided by Tallgrass and confirmation of payment of the civil penalty on May 13, 2022, it has been determined that Tallgrass has complied with the terms of this Order. Accordingly, this case is now closed, and no further action is contemplated with respect to the matters involved in this case. Thank you for your cooperation in this matter. Sincerely, Gregory A. Ochs Director, Central Region, OPS Pipeline and Hazardous Materials Safety Administration cc: Jennifer Eckles, Director Compliance, jennifer.eckels@tallgrassenergylp.com Crystal Heter, Chief Operating Officer, crystal.heter@tallgrassenergylp.com 32021046NOPV_Op Resp to Notice and Req for Hearing and Statement of Issues (Part 2)_01212022_(20-172259).pdf U.S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY In the Matter of ) Tallgrass Pony Express Pipeline, LLC, ) CPF No. 3-2021-046-NOPV ) ) Respondent. ) __________________________________________) REQUEST FOR INFORMAL CONFERENCE, REQUEST FOR HEARING AND PRELIMINARY STATEMENT OF ISSUES FOR NOPV ITEMS 5 AND 6 WRITTEN RESPONSE TO NOPV ITEMS 1, 2, 3, 4, 7, 8, 9, AND 10 I. Request for Informal Conference Regarding NOPV Items 5 and 6 Pursuant to 49 U.S.C. § 60117(b)(1)(B), Tallgrass Pony Express Pipeline, LLC (Tallgrass) respectfully requests an informal meeting to discuss the allegations in Items 5 and 6 of the above- referenced Notice of Probable Violation, Proposed Civil Penalty, and Proposed Compliance Order (NOPV). Tallgrass is hopeful that through further discussion of the facts and circumstances around Items 5 and 6 that these portions of the NOPV can be addressed without a hearing. II. Request for Hearing Regarding NOPV Items 5 and 6 Pursuant to 49 C.F.R. §§ 190.208(a)(4) and 190.211(b), Tallgrass respectfully requests an in-person hearing to discuss the alleged violation and proposed civil penalties for Items 5 and 6. If a hearing is held, Tallgrass will be represented by counsel at the hearing. III. Preliminary Statement of Issues Tallgrass respectfully contests the allegations of violation and proposed civil penalties for Items 5 and 6, concerning the Company’s Integrity Management Program. At the hearing, Tallgrass intends to raise the following issues: Tallgrass Pony Express Pipeline, LLC CPF 3-2021-046-NOPV Item 5 – 49 C.F.R. §§ 195.452(b)(4)(i) and 195.452(f)(6) – Identification of Preventive and Mitigative Measures A. Whether, based on the allegation in the Notice and evidence in the record, PHMSA met its burden of proof and persuasion that Tallgrass committed a probable violation of 49 C.F.R. §§ 195.452(b)(4)(i) and 195.452(f)(6). B. Whether Tallgrass can present evidence that it had a process for identifying preventive and mitigative measures to protect its facilities, as well as documentation that that process was implemented. C. Whether the proposed penalty must be withdrawn. Item 6 – 49 C.F.R. § 195.452(l)(1)(ii) – Documentation of Information Analysis A. Whether, based on the allegation in the Notice and evidence in the record, PHMSA met its burden of proof and persuasion that Tallgrass committed a probable violation of 49 C.F.R. §§ 195.452(l)(1)(ii). B. Whether Tallgrass can present evidence that it documented its information analyses under §§ 195.452(g) and 195.452(l)(1)(ii), including the integration of Pipe Evaluation Reports in the information analysis, and also into other aspects of its Integrity Management Program. C. Whether the proposed penalty must be withdrawn. Tallgrass reserves the right to supplement this preliminary statement of issues in response to any additional information or arguments from PHMSA. IV. Written Response to NOPV Items 1, 2, 3, 4, 7, 8, 9, and 10 Pursuant to 49 C.F.R. §§ 190.208(a)(2), 190.208(a)(3) and 190.208(b)(3) Tallgrass provides the following written response to Items 1, 2, 3, 4, 7, 8, 9, and 10 of the NOPV. A. Item 1 – 49 C.F.R. § 195.310(a) Tallgrass respectfully contests this alleged probable violation. Tallgrass has complete documentation of the pressure test for Tank 3400 at the Natoma Kansas station. PHMSA alleged that Tallgrass did not provide records in accordance with 49 C.F.R. § 195.307 and API Std 650, Sections 7.3.5. and 7.3.6. Specifically, PHMSA asserts that Tank 3400 “did not have a record of 2 Tallgrass Pony Express Pipeline, LLC CPF 3-2021-046-NOPV fill level or test duration to confirm the pressure of the hydrotest after construction.” However, Tallgrass does in fact have records of these parameters. Tallgrass is contesting this violation. API 650 Section 7.3.5 Testing of the Shell 7.3.6 Hydrostatic Testing Requirements requires the following criteria for a hydrostatic test of a tank: 7.3.5 Testing of the Shell After the entire tank and roof structure is completed, the shell (except for the shell of tanks designed in accordance with Annex F) shall be strength-tested and the foundation initially loaded by one of the following methods, as specified on the Data Sheet, Line 14: 1. If water is available for testing the shell, the tank shall be filled with water as follows: (1) to the maximum design liquid level, H; …….the tank shall be inspected frequently during the filling operation…….. 7.3.6 Hydrostatic Testing Requirements 7.3.6.5 1. Shell elevation measurements shall be made at equally-spaced intervals around the tank circumference not exceeding 10 m (32 ft). The minimum number of shell measurement points shall be eight. 2. Observed elevations shall be referred to a permanent benchmark. The level instrument shall be set up at least 1 1/2 times tank diameter away from the tank when tank elevation readings are taken. Six sets of settlement readings are required: a. Before start of the hydrostatic test; b. With tank filled to 1/4 test height (±600 mm [2 ft]); c. With tank filled to 1/2 test height (±600 mm [2 ft]); d. With tank filled to 3/4 test height (±600 mm [2 ft]); e. At least 24 hours after the tank has been filled to the maximum test height. This 24-hour period may be increased to duration specified on the data sheet if the Purchaser so requires for conditions such as: i. The tank is the first one in the area, ii. The tank has a larger capacity than any other existing tank in the area, iii. The tank has a higher unit bearing load than any other existing tank in the area, iv. There is a question regarding the rate or magnitude of settlement that will take place; f. After tank has been emptied of test water. 3 Tallgrass Pony Express Pipeline, LLC CPF 3-2021-046-NOPV With respect to the specific inadequacies alleged in the NOPV, Tallgrass provides the following information: Fill Height and Elevation Measurements: During the inspection, Tallgrass provided the document titled Hydrotest Survey Natoma KS 2017-12-21 which indicated that the required elevation measurements were taken at all six (6) fill heights described in API 650 Section 7.3.6.5(b) above, and at a distance around the tank not exceeding 10 m (32 ft.) as required by API 650 Section 7.3.7.5(a). Tallgrass has included Natoma KS 2017- 12-21 in Attachment 1 to this response. Test Duration: During the inspection, Tallgrass provided the tank inspector’s reports from December 1, 2017 through to December 5, 2017, which list the start of the test, the dates and times that the 1/4, 1/2, 3/4 and full levels were reached, when the 24-hour hold began and concluded, when the tank was emptied, and an indication that no leaks were discovered as required by API 650 Section 7.3.6. Tallgrass has included the tank inspector’s reports in Attachment 1 to this response. Test Pressures: PHMSA alleges that Tallgrass failed to confirm the pressure of the hydrotest. However, Natoma Tank 3400 is an atmospheric pressure tank and was therefore hydrostatically tested with a water fill at atmospheric pressure as required by API 650. No pressure measurements are required for an atmospheric tank test. Tallgrass has included a photograph of the tank nameplate in Attachment 1 to this response. This photograph shows that Tank 3400 is an atmospheric pressure tank. Based on the foregoing, and the records included in Attachment 1, Tallgrass respectfully requests that PHMSA withdraw this Item. While this is a warning item, failure to withdraw it would result in a factual error in the public record. This factual error, if allowed to persist, could have harmful effects on Tallgrass in its future dealings with the public, third parties and regulatory agencies. Tallgrass also notes that since the inspection, in the spirit of continual improvement, Tallgrass has created a new form to capture and centralize key information from tank pressure test documentation. B. Items 2 and 10 – 49 C.F.R. §§ 195.402(a) and 195.577(a) Items 2 and 10 are warning items that relate to external corrosion control. With respect to Item 2, Tallgrass offers the clarification that it discovered in a 2019 cathodic protection (CP) system survey that certain decouplers on the NECL were malfunctioning. Tallgrass corrected the issue and CP system potentials were elevated and met criteria within 15-months. With respect to Item 10, Tallgrass wishes to clarify that there is no stray current interference on the NECL pipeline. Instead, the NECL pipeline had a larger CP current requirement to achieve protection. 4 Tallgrass Pony Express Pipeline, LLC CPF 3-2021-046-NOPV C. Item 3 – 49 C.F.R. § 195.406(b) Tallgrass respectfully requests that PHMSA eliminate two instances of the alleged overpressure violation and reduce the civil penalty for a variety of reasons. Each of the instances of violation is set out below, along with additional information and explanation. Following the discussion of each instance, Tallgrass provides explanation in support of a penalty reduction for this Item. 1. 130% MOP on 08-04-18 for NECL North line at the Noble meter skid due to power loss and ESD at Buckingham (ERL 1356, 1357, 1358). Tallgrass respectfully requests that PHMSA remove this instance from the alleged violation. The Emergency Response Line (ERL) notification for this event indicated that this was a pressure exceedance of 130% MOP. ERLs are issued quickly in response to an undesired event, and before any detailed investigation occurs. Upon further investigation Tallgrass determined that an alarm had been set to trip based on an ANSI 150 class system, instead of the actual, higher 450 psig MOP at the Noble meter skid. The Noble meter skid is all ANSI 300 rated and Tallgrass has set MOP to 450 psig based on station hydraulics. The pressure at the Noble meter reached approximately 370 psig, below the 450 psig MOP at this location. As a result, what appeared initially to be an MOP exceedance was not, in fact, an exceedance. Tallgrass has reset the alarm to reflect the correct 450 psig MOP for the Noble meter skid. Please see Attachment 2 for documentation of the 450 psig MOP at the Noble meter skid, and a graph of the pressures during the event that shows the 450 psig MOP was never exceeded. On the basis of these materials, Tallgrass requests that PHMSA remove this instance of violation from Item 3 and reduce the number of instances of violation for this Item for purpose of calculating the civil penalty under the gravity factor. 2. 115% MOP on 07-26-19 during startup on PXP North (ERL 1679). Tallgrass does not contest this instance of the alleged violation. However, Tallgrass requests that PHMSA provide a reduction in the civil penalty related to this allegation to reflect that Tallgrass identified the causes of the problem and corrected them before the start of PHMSA’s inspection in August 2020. Specifically, Tallgrass installed relief at Guernsey station to prevent future overpressure events. Please see Attachment 2 for the point-to-point verification that was conducted on the new safety relief valve (SRV) installed in April of 2020. This documentation demonstrates that Tallgrass corrected the problem before PHMSA’s inspection. On the basis of these materials, Tallgrass requests that PHMSA provide a credit under the gravity assessment criteria, as more fully described below, in the penalty section. 5 Tallgrass Pony Express Pipeline, LLC CPF 3-2021-046-NOPV 3. 114% MOP on 10-10-19 at Pawnee due to shut down of Hereford Ranch Lateral, no surge relief (ERL 1773). Tallgrass does not contest this instance of the alleged violation. However, Tallgrass requests that PHMSA provide a reduction in the civil penalty related to this allegation to reflect that Tallgrass identified the causes of the problem and corrected them before the start of PHMSA’s inspection in August 2020. Specifically, Tallgrass installed a control valve and relief system at the Pawnee station to prevent future overpressure events. Please see Attachment 2 for the point-to-point verification that was conducted on the new relief valve in May of 2020. This documentation demonstrates that Tallgrass corrected the problem before PHMSA’s inspection. On the basis of these materials, Tallgrass requests that PHMSA provide a credit under the gravity factor, as more fully described below, in the penalty section. 4. 113% MOP on 3-18-20 at McPherson Lateral due to control valve failure (ERL 2018). Tallgrass respectfully requests that PHMSA remove this instance from the alleged violation. The ERL notification for this event indicated that this was a pressure exceedance of 113% MOP. ERLs are issued quickly in response to undesired events, and before any detailed investigation occurs. Upon further investigation Tallgrass determined that the MOP exceedance only reached 102%, which is below the 110% MOP limit under § 195.406(b). The actual pressure reached 291 psig, and the MOP at this location is 285 psig. Tallgrass has relief in place at this location to prevent the pressure from exceeding the § 195.406(b) limit. Please see Attachment 2 for a SCADA record that shows that the highest pressure reached during the March 18, 2020, event was 291 psig, in reference to the High and High-High alarms denoted by the red dashed horizontal lines. The High-High is set at 99% MOP, which equates to 282 psig. On the basis of these materials, Tallgrass requests that PHMSA remove this instance of violation from Item 3 and reduce the number of instances of violation for this Item for purpose of calculating the civil penalty under the Gravity factor. 5. 114.5% MOP on 6-25-20 at Hereford Lateral/Pawnee due to unintended closure of control valve (ERL 2180) Tallgrass does not contest this instance of the alleged violation. Tallgrass requests adjustment of the civil penalty related to this instance under the gravity factor, as discussed below. Penalty Reduction for Item 3 Tallgrass respectfully requests that PHMSA reduce the proposed penalty for Item 3 on the basis of the factual information described above and supported in the attached 6 Tallgrass Pony Express Pipeline, LLC CPF 3-2021-046-NOPV documentation. Tallgrass seeks a penalty reduction under the gravity, culpability, and as justice may require factors at 49 C.F.R. §§ 190.225(a)(1), 190.225(a)(2) and 190.225(b)(2), respectively. First, as explained above, Tallgrass undertook further investigation of the 5 events described above. As a result of that investigation, the Company determined that 2 of the 5 events did not in fact result in an exceedance of 110% MOP, and therefore do not constitute violations of § 195.406(b). On that basis, Tallgrass requests that PHMSA reduce the number of instances of violation from 5 to 3 in the gravity section of the Proposed Civil Penalty Worksheet. Based on that reduction, PHMSA should reduce the “additional gravity points for multiple instances of violation” from 13.6 to 6.8. It is evident from other entries in PHMSA’s Proposed Civil Penalty Worksheet that the agency ascribes 6.8 gravity points to a violation involving 3 instances of violation.1 At a point value of $1,728, this instance-based gravity reduction should be $11,750. Second, and also with respect to the gravity factor, PHMSA’s Proposed Civil Penalty Worksheet adds 17 gravity points based on an assertion in the Violation Report that the “violation occurred within an HCA or ‘could affect’ HCA.”2 This assertion appears to be based on a statement from PHMSA’s Violation Report that “all Tallgrass pipelines in the system contain HCA segments. ”3 Tallgrass has evaluated its HCA listings and determined that the facilities where these events took place were not located in, nor could they affect an HCA. Documentation demonstrating the non-HCA status of these facilities is contained in Attachment 3. None of the stations is listed in the attached HCA listings because none are in or could affect an HCA. In addition, regarding PHMSA’s concern that the events at these locations could have resulted in overpressures on connected pipeline segments that are in HCAs, all of the events only affected station piping and none resulted in overpressure of mainline piping. As demonstrated in the table below, the MOPs of the mainlines serving these stations is far above the MOP of the station piping. Station Station Piping MOP (psig) Mainline MOP (psig) Noble Meter (NECL) 450 1440 Guernsey South Terminal (PXP North) 285 1440 Pawnee (Hereford Lateral) 285 1440 McPherson 285 1440 On this basis, Tallgrass requests that PHMSA reduce the gravity points from 17 to 7, which should result in an additional reduction of $17,280. This adjustment is reasonable and appropriate because none of the locations identified are an HCA facility. This adjustment also reflects that no mainline HCA piping experienced an MOP exceedance as a result of the station piping exceedances at these facilities. 1 PHMSA Proposed Civil Penalty Worksheet, Columns for Items 5 and 6, depict 3 instances of violation, each with additional gravity points of 6.8. 2 PHMSA Proposed Civil Penalty Worksheet, gravity section; PHMSA Violation Report at 15. 3 PHMSA Violation Report at 15. 7 Tallgrass Pony Express Pipeline, LLC CPF 3-2021-046-NOPV Third, with respect to the culpability factor, PHMSA provides up to a -15 point credit in circumstances where an operator finds and fixes issues before a PHMSA inspection. 4 Specifically, such a credit is appropriate if “[a]fter the operator found the non-compliance, the operator took documented action to address the cause of the non-compliance, and corrected the non-compliance before PHMSA learned of the violation.”5 As explained above, Tallgrass undertook and completed corrective action with respect to two6 of the three remaining instances of violation before the inspection, and therefore the penalty should be reduced accordingly. Given these efforts, PHMSA should provide a -10 point reduction under the culpability factor. At a $1,728 point value, this results in an additional reduction of $17,280. Finally, PHMSA has assigned 40 additional points under the “as justice may require” factor, due to a repeat offense from a 2016 Final Order. Tallgrass does not contest that this is a repeat offense. However, this 40-point assignment is based on an underlying 17-point gravity score. As discussed above, because none of the overpressure events occurred in an HCA or a could affect area, that gravity score must drop from 17 to 7 points. Based on the point ranges for repeat offenses in PHMSA’s Proposed Civil Penalty Worksheet, the “as justice may require” score should also drop, from 40 to 30 points. This adjustment results in an additional $17,280 reduction in the civil penalty. Based on the various appropriate penalty adjustments described above, the civil penalty for this item should be adjusted from $151,300 to $87,710. Proposed Compliance Order for Item 3 Tallgrass requests that PHMSA clarify the Proposed Compliance Order to reflect that Tallgrass may prevent MOP exceedance using a range of “adequate controls and protective equipment,” pursuant to § 195.406(b), and not only surge relief devices as presently specified in the Proposed Compliance Order. D. Item 4 - 49 C.F.R. § 195.440(g) Tallgrass respectfully requests that PHMSA convert this alleged violation into a Notice of Amendment (NOA). Tallgrass acknowledges that it needs to improve its program for communicating with non-English speakers. The Company intends to update its procedures concerning determination of what is a “significant” non-English speaking population. And reflecting PHMSA’s concerns, Tallgrass will rely on Spanish language mailers, instead of just the Spanish language content on its website. PHMSA has the discretion to change this item to an NOA and given the procedure-focused nature of PHMSA’s concern, doing so would be reasonable. 4 PHMSA Proposed Civil Penalty Worksheet, culpability section. 5 Id. 6 In the second and third instances of violation, 115% MOP on 07-26-19 during startup on PXP North (ERL 1679) and 114% MOP on 10-10-19 at Pawnee due to shut down of Hereford Ranch Lateral, no surge relief (ERL 1773), Tallgrass corrected the issue through installation of equipment and other actions at these locations. And did so before PHMSA began its inspection in August 2020. 8 Tallgrass Pony Express Pipeline, LLC CPF 3-2021-046-NOPV E. Items 7, 8, and 9 – 49 C.F.R. §§ 195.573(a)(1) and 195.573(c) The above-listed Items all relate to Tallgrass’ 2020 self-report of external corrosion control survey and data issues. Tallgrass does not contest these Items. However, Tallgrass respectfully requests that the Final Order in this case reflect the Company’s proactive efforts to resolve the underlying issues and improve its practices and procedures. Those efforts are summarized below. As listed in detail in the Company’s self-report communications, after discovering these issues, Tallgrass took steps to verify that they did not present safety concerns. Specifically, Tallgrass conducted un-planned close interval surveys (CIS) and reads of cathodic protection (CP) test stations, as well as an analysis of In-Line Inspection and other inspection and repair data on affected pipeline segments. The results of these efforts confirmed that there were no immediate corrosion-related safety concerns. Tallgrass then began several remedial actions to prevent recurrence of the corrosion survey and data issues, including additional training, improved corrosion data collection and tracking tools, review and amendment of relevant corrosion procedures, establishment of an annual corrosion program performance review meeting, quarterly data reviews, addition of personnel, and additional CIS and CP system improvements. Tallgrass shares PHMSAs commitment to pipeline safety and appreciates being afforded the opportunity to work with PHMSA to ensure the safe operation of our pipelines. Please do not hesitate to contact me if you have any questions about this response. I will contact you to discuss scheduling an informal conference regarding Items 5 and 6. Respectfully submitted this 21st day of January 2022. Jennifer Eckels Manager - Compliance 370 Van Gordon Street Lakewood, CO 80228 Phone: (303) 763-3486 CC: Tallgrass: Byron Gale, Jay Meyers, Jarid Kling, Nicole Longwell, Crystal Heter PHMSA: Gabe Hodill, AJ McKean Enclosures: Attachment 1: Natoma Terminal Tank 3400 Hydrotest Fill Height and Elevation Measurements Natoma Terminal Tank 3400 Tank Inspector’s Report 12/1/2017 9 Tallgrass Pony Express Pipeline, LLC CPF 3-2021-046-NOPV Natoma Terminal Tank 3400 Tank Inspector’s Report 12/2/2017 Natoma Terminal Tank 3400 Tank Inspector’s Report 12/3/2017 Natoma Terminal Tank 3400 faceplate Attachment 2: SCADA Record of Actual Pressure Reached and Setpoint on 08/04/2018 and Management of Change Notification (Noble Meter) Point-to-Point Record Confirming Installation of Safety Relief Valve (Guernsey) Point-to-Point Record Confirming Installation of Safety Relief Valve (Pawnee) SCADA record of Actual Pressure Reached and Setpoint on 03/18/2020 (McPherson) Attachment 3: 2019 & 2020 Facility Equipment Maintenance Plans (listing HCA facilities) 10 32021046NOPV_PHC Hearing Scheduled_02072022_(20-172259)_text.pdf February 7, 2022 VIA ELECTRONIC MAIL TO: jennifer.eckels@tallgrassenergylp.com and gregory.ochs@dot.gov Ms. Jennifer Eckels Manager – Compliance Tallgrass Energy, LP 370 Van Gordon Street Lakewood, CO 80228 Mr. Gregory Ochs Director, Central Region Pipeline and Hazardous Materials Safety Administration 901 Locust Street, Suite 480 Kansas City, MO 64106-2641 Re: Notice of Hearing, Tallgrass Pony Express Pipeline, LLC CPF No. 3-2021-046-NOPV Dear Ms. Eckels and Mr. Ochs: In accordance with 49 C.F.R. § 190.211, an informal hearing will be held regarding the Notice of Probable Violation, Proposed Civil Penalty, and Proposed Compliance Order issued by the Pipeline and Hazardous Materials Safety Administration in the above-referenced case. The hearing will take place on May 4, 2022, beginning at 8:30 a.m. Central Time. The hearing will be held via videoconference. I will provide the videoconference information prior to the hearing. At least 10 calendar days prior to the hearing (or by April 25, 2022), both parties must submit and exchange any additional written materials they intend to present at the hearing and the name and email address of each attendee. This information should be provided electronically. Materials not submitted by this date may be excluded. If you have any questions, please do not hesitate to contact me. Sincerely, Larry White Presiding Official cc: Mr. William Moler, Chief Executive Officer, Tallgrass Pony Express Pipeline, LLC, bill.moler@tallgrassenergylp.com Mr. Joseph Hainline, Counsel, Central Region, Office of Pipeline Safety, joseph.hainline@dot.gov 32021046NOPV_Consent Agreement and Order_05102022_(20-172259)_text.pdf May 10, 2022 VIA ELECTRONIC MAIL TO: bill.moler@tallgrassenergylp.com Mr. William Moler Chief Executive Officer Tallgrass Pony Express Pipeline, LLC 4200 W. 115th Street, Suite 350 Leawood, Kansas 66211 CPF No. 3-2021-046-NOPV Dear Mr. Moler: Enclosed please find a Consent Order incorporating the terms of the Consent Agreement between the Pipeline and Hazardous Materials Safety Administration (PHMSA) and Tallgrass Pony Express Pipeline, LLC (Tallgrass), which was executed on May 10, 2022. Service of the Consent Order and Consent Agreement by electronic mail is deemed effective upon the date of transmission and acknowledgement of receipt, or as otherwise provided under 49 C.F.R. § 190.5. Sincerely, Alan K Mayberry Associate Administrator for Pipeline Safety Enclosures: Consent Agreement and Consent Order Cc: Mr. Gregory Ochs, Director, Central Region, Office of Pipeline Safety, PHMSA Ms. Catherine Little, outside counsel for Tallgrass, catherine.little@troutman.com Ms. Jennifer Eckels, Compliance Manager, Tallgrass, jennifer.eckels@tallgrass.com CONFIRMATION OF 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 ) Tallgrass Pony Express Pipeline, LLC, ) CPF No. 3-2021-046-NOPV ) ) ) Respondent. ) ____________________________________) CONSENT ORDER By letter dated November 23, 2021, the Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety (PHMSA), issued a Notice of Probable Violation, Proposed Civil Penalty, and Proposed Compliance Order (Notice) to Tallgrass Pony Express Pipeline, LLC (Tallgrass or Respondent). In response to the Notice, Respondent contested the underlying allegations for Items 1, 5, and 6; offered additional information regarding the facts underlying Items 2 and 10; requested a reduction of the instances of violation for Item 3 along with a corresponding reduction to the proposed civil penalty, and modification of the proposed compliance order; requested conversion of Item 4 to a Notice of Amendment; and requested additional language be added to the Final Order for Items 7, 8, and 9 reflecting Respondent’s efforts to improve its practices and procedures (Response). Respondent also requested a hearing and asked for the opportunity to meet informally with PHMSA to discuss Items 5 and 6. Respondent and PHMSA (the Parties) subsequently met to discuss the issues raised in the Response. As a result of those discussions PHMSA has agreed to withdraw the warning in Item 1, and Respondent has agreed to withdraw its hearing request and accept the findings of violation alleged in the Notice, subject to the clarifications as set forth in the Consent Agreement, pay a reduced civil penalty in the amount of $385,500 for Items 3, 5, 6, 7, 8, and 9, and to undertake certain corrective measures. Accordingly, the Consent Agreement is hereby approved and incorporated by reference into this Order. Tallgrass is hereby ordered to comply with the terms of the Consent Agreement, effective immediately. Pursuant to 49 U.S.C. 60101, et seq., failure to comply with this Consent Order may result in the assessment of civil penalties as set forth in 49 C.F.R. § 190.223. The terms and conditions of this Consent Order are effective upon service in accordance with 49 C.F.R. § 190.5. May 10, 2022 ___________________________________ __________________________ Alan K. Mayberry Date Issued Associate Administrator for Pipeline Safety 2U.S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY WASHINGTON, D.C. 20590 ) In the Matter of ) ) Tallgrass Pony Express Pipeline, LLC, ) ) ) CPF No. 3-2021-046-NOPV Respondent. ) ____________________________________) CONSENT AGREEMENT From August 2, 2020, to October 23, 2020, 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 (U.S.C.), inspected Tallgrass Pony Express Pipeline, LLC’s (Tallgrass or Respondent) records and facilities in Lakewood, Colorado. As a result of the inspection, the Director, Central Region, OPS (Director), issued to Respondent, by letter dated November 23, 2021, a Notice of Probable Violation, Proposed Civil Penalty and Proposed Compliance Order (Notice). In accordance with 49 C.F.R. § 190.207, the Notice alleged that Respondent committed probable violations of seven provisions of 49 C.F.R. part 195 (Items 3, 4, 5, 6, 7, 8, and 9), proposed ordering Respondent to take certain measures to correct the alleged violations, and proposed a civil penalty in the amount of $437,300 associated with those items. Three other probable violations (Items 1, 2, and 10) were brought as warnings, advising Respondent to correct them or be subject to potential future enforcement action. In response to the Notice, Respondent contested the underlying allegations for Items 1, 5, and 6; offered additional information regarding the facts underlying Items 2 and 10; requested a reduction of the instances of violation for Item 3 along with a corresponding reduction to the proposed civil penalty, and modification of the proposed compliance order; requested conversion of Item 4 to a Notice of Amendment; and requested additional language be added to the Final Order for Items 7, 8, and 9 reflecting Respondent’s efforts to improve its practices and procedures (Response). Respondent also requested a hearing and asked for the opportunity to meet informally with PHMSA to discuss Items 5 and 6. PHMSA and Respondent (the Parties) subsequently met to discuss the issues raised in the Response. As a result of those discussions, as explained in more detail below, PHMSA has agreed to withdraw the warning in Item 1, and Respondent has agreed to withdraw its hearing request and accept the findings of violation alleged in the Notice, subject to the clarifications as set forth below, pay a reduced civil penalty in the amount of $385,500 for Items 3, 5, 6, 7, 8, and 9, and to undertake certain corrective measures. Having agreed that settlement of this enforcement action will avoid further administrative proceedings or litigation and will serve the public interest by promoting safety and protection of the environment, pursuant to 49 C.F.R. part 190, and upon consent and agreement of Respondent and PHMSA, the Parties hereby agree as follows: I. General Provisions: 1. Respondent acknowledges that as the operator of the pipeline facilities subject to the Notice, Respondent and its referenced hazardous liquid pipeline facilities are subject to the jurisdiction of the Federal pipeline safety laws, 49 U.S.C. § 60101, et seq., and the regulations and administrative orders issued thereunder. For purposes of this Agreement, Respondent acknowledges that it received proper notice of PHMSA’s action in this proceeding and that the Notice states claims upon which relief may be granted pursuant to 49 U.S.C. § 60101, et seq., and the regulations and orders issued thereunder. 2. After Respondent returns this signed Agreement to PHMSA, the Agency’s representative will present it to the Associate Administrator for Pipeline Safety, recommending that the Associate Administrator adopt the terms of this Agreement by issuing an administrative order (Consent Order) incorporating the terms of this Agreement. The terms of this Agreement constitute an offer of settlement until accepted by the Associate Administrator. Once accepted, the Associate Administrator will issue a Consent Order incorporating the terms of this Agreement. 3. Respondent consents to the issuance of the Consent Order, and hereby waives any further procedural requirements with respect to its issuance. Respondent waives all rights to contest the adequacy of notice, or the validity of the Consent Order or this Agreement, including all rights to administrative or judicial hearings or appeals, except as set forth herein. 4. This Agreement shall apply to and be binding upon PHMSA and Respondent, its officers, directors, and employees, and its successors, assigns, or other entities or persons otherwise bound by law. Respondent agrees to provide a copy of this Agreement and any incorporated work plans and schedules to all of Respondent’s officers, employees, and agents whose duties might reasonably include compliance with this Agreement. 5. This Agreement constitutes the final, complete and exclusive agreement and understanding between the Parties with respect to the settlement embodied in this Agreement. The Parties acknowledge that there are no representations, agreements or understandings relating to settlement other than those expressly contained in this Agreement, except that the terms of this Agreement may be construed by reference to the Notice. 6. Nothing in this Agreement affects or relieves Respondent of its responsibility to comply with all applicable requirements of the Federal pipeline safety laws, 49 U.S.C. § 60101, et seq., and the regulations and orders issued thereunder. Nothing in this Agreement alters PHMSA’s right of access, entry, inspection, and information gathering or PHMSA’s authority to bring enforcement actions against Respondent pursuant to the Federal pipeline safety laws, the regulations and orders issued thereunder, or any other provision of Federal or State law. 7. For all transfers of ownership or operating responsibility of Respondent’s pipeline system referenced herein, Respondent will provide a copy of this Agreement to the prospective transferee at least 30 days prior to such transfer. Respondent will provide written notice of the transfer to the PHMSA Central Regional Director no later than 60 days after the transfer occurs. 8. This Agreement does not waive or modify any Federal, State, or local laws or regulations that are applicable to Respondent’s pipeline systems. This Agreement is not a permit, or a modification of any permit, under any Federal, State, or local laws or regulations. Respondent remains responsible for achieving and maintaining compliance with all applicable Federal, State, and local laws, regulations and permits. 9. This Agreement does not create rights in, or grant any cause of action to, any third party not party to this - **truncated:** true - **body characters:** 59949