{"operation":"document","citation":"CPF 32021051NOPV","title":"BOE MIDSTREAM — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2021-11-10","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.440(c), 195.440(g), 195.452(h)(4)(iii)(E), 195.452(l)(1)(ii), 195.573(e), 195.581(b).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-32021051nopv.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-32021051nopv.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-32021051nopv","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/32021051NOPV","body":"Notice of Probable Violation involving BOE MIDSTREAM. PHMSA's enforcement data identifies the cited regulations as 195.440(c),  195.440(g),  195.452(h)(4)(iii)(E),  195.452(l)(1)(ii),  195.573(e),  195.581(b). The case was opened on 2021-11-10 and is reported as closed as of 2022-09-15. Proposed civil penalty: $61,700. Assessed civil penalty: $42,100. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n32021051NOPV_Closure Letter_09152022_(21-200403).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021051NOPV/32021051NOPV_Closure%20Letter_09152022_(21-200403).pdf\n\n32021051NOPV_Closure Letter_09152022_(21-200403)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021051NOPV/32021051NOPV_Closure%20Letter_09152022_(21-200403)_text.pdf\n\n32021051NOPV_Final Order_08182022_(21-200403).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021051NOPV/32021051NOPV_Final%20Order_08182022_(21-200403).pdf\n\n32021051NOPV_Final Order_08182022_(21-200403)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021051NOPV/32021051NOPV_Final%20Order_08182022_(21-200403)_text.pdf\n\n32021051NOPV_Operator Response to Notice_02042022_(21-200403).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021051NOPV/32021051NOPV_Operator%20Response%20to%20Notice_02042022_(21-200403).pdf\n\n32021051NOPV_Operator Response to Notice_12102021_(21-200403).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021051NOPV/32021051NOPV_Operator%20Response%20to%20Notice_12102021_(21-200403).pdf\n\n32021051NOPV_PCP PCO_11102021_(21-200403).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021051NOPV/32021051NOPV_PCP%20PCO_11102021_(21-200403).pdf\n\n32021051NOPV_PCP PCO_11102021_(21-200403)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021051NOPV/32021051NOPV_PCP%20PCO_11102021_(21-200403)_text.pdf\n\n32021051NOPV_Closure Letter_09152022_(21-200403)_text.pdf\n\nVIA ELECTRONIC MAIL TO: mos@everdesk.com; BMcDowell@BOEMidstream.com\nSepetmber 15, 2022\nMr. Michael O’Shaughnessy\nPresident/CEO\nBOE Midstream\n8301 E. 21st Street North, Suite 420\nWichita, KS 67206\nRe: CPF 3-2021-051-NOPV\nDear Mr. O’Shaughnessy:\nOn August 18, 2022, the Pipeline and Hazardous Materials Safety Administration (PHMSA)\nissued to BOE Midstream, LLC a Final Order in the above-referenced case. This Order included\na Compliance Order and Civil Penalty assessment. Based on our review of the documentation\nyou provided and confirmation of payment of the civil penalty, it has been determined that BOE\nMidstream, LLC has 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 A. Ochs\nDirector, Central Region, OPS\nPipeline and Hazardous Materials Safety Administration\ncc: Brandon McDowell, Director – ND Operations & Regulatory Compliance,\nBMcDowell@BOEMidstream.com\n\n32021051NOPV_Final Order_08182022_(21-200403)_text.pdf\n\nAugust 18, 2022\nVIA ELECTRONIC MAIL TO: mos@everdesk.com\nMr. Michael O’Shaughnessy\nPresident\nBOE Midstream, LLC\n8301 East 21st Street North, Suite 420\nWichita, Kansas 67206\nRe: CPF No. 3-2021-051-NOPV\nDear Mr. O’Shaughnessy:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation and assesses a reduced civil penalty of $42,100. It further finds that BOE Midstream,\nLLC, has completed the actions specified in the Notice to comply with the pipeline safety\nregulations. When the civil penalty has been paid, this enforcement action will be closed.\nService of the Final Order by e-mail is effective upon the date of transmission and\nacknowledgement of receipt as 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\nEnclosures (Final Order)\ncc: Mr. Gregory Ochs, Director, Central Region, Office of Pipeline Safety, PHMSA\nMr. John Wadsworth, Chief Operating Officer, BOE Midstream, LLC,\njwadsworth@boemidstream.com\n\n\n\nMr. Brandon McDowell, Director, ND Operations & Regulatory Compliance, BOE\nMidstream, LLC, bmcdowell@boemidstream.com\nMr. Levent Kilic, General Manager, BOE Pipelines and LL Terminals, BOE Midstream,\nLLC, lkilic@boemidstream.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 )\nBOE Midstream, LLC, ) CPF No. 3-2021-051-NOPV\n)\n)\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nOn January 26, March 10-12, March 29-31, April 6, and April 21-22, 2021, pursuant to 49\nU.S.C. § 60117, a representative of the Pipeline and Hazardous Materials Safety Administration\n(PHMSA), Office of Pipeline Safety (OPS), conducted an on-site and virtual pipeline safety\ninspection of the facilities and records of BOE Midstream, LLC (BOE or Respondent) in\nDickinson and Killdeer, North Dakota. BOE operates pipelines with a nominal diameter of 16\ninches and 20 inches that transport crude oil from numerous sources in a two-county area. The\ncrude oil pipeline originates at a pump station near Killdeer, North Dakota and terminates at a\nrail terminal near Dickinson, North Dakota. BOE’s pipeline system is 38.3 miles long from\nKilldeer to Dickinson.1\nAs a result of the inspection, the Director, Central Region, OPS (Director), issued to Respondent,\nby letter dated November 10, 2021, 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 BOE had violated the pipeline safety regulations in 49 C.F.R. Part 195 and\nproposed assessing a civil penalty of $61,700 for the alleged violations. The Notice also\nproposed ordering Respondent to take certain measures to correct the alleged violations.\nBOE responded to the Notice by letter dated December 10, 2021, and supplemented this\nresponse on February 4 and February 22, 2022 (Responses). BOE contested several of the\nallegations, offered additional information in response to the Notice, and requested that the\nproposed civil penalty be reduced or eliminated. Respondent did not request a hearing and\ntherefore has waived its right to one.\nFINDINGS OF VIOLATION\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.440(c), which states:\n§ 195.440 Public awareness.\n1 Pipeline Safety Violation Report (Violation Report), (November 10, 2021) (on file with PHMSA), at 1.\n\n\n\n(a) . . . .\n(c) The operator must follow the general program recommendations,\nincluding baseline and supplemental requirements of API RP 1162, unless\nthe operator provides justification in its program or procedural manual as to\nwhy compliance with all or certain provisions of the recommended practice\nis not practicable and not necessary for safety.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.440(c) by failing to follow the\ngeneral program recommendations, including baseline and supplemental requirements of API RP\n1162. Specifically, the Notice alleged that BOE failed to include each of the required\nstakeholder audiences in the 2019 four-year effectiveness review as required by section 8.4 of\nAPI RP 1162.\nRespondent did not contest this allegation of violation. Accordingly, based on a review of the\nevidence, I find that Respondent violated 49 C.F.R. § 195.440(c) by failing to follow the general\nprogram recommendations, including baseline and supplemental requirements of API RP 1162.\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. § 195.440(c), which states:\n§ 195.440 Public awareness.\n(a) . . . .\n(c) The operator must follow the general program recommendations,\nincluding baseline and supplemental requirements of API RP 1162, unless\nthe operator provides justification in its program or procedural manual as to\nwhy compliance with all or certain provisions of the recommended practice\nis not practicable and not necessary for safety.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.440(c) by failing to follow the\ngeneral program recommendations, including baseline and supplemental requirements of API RP\n1162. Specifically, the Notice alleged that BOE failed to follow section 8.4.4 of API RP 1162\nwhich requires operators to determine if the implementation of the Public Awareness Program is\nimpacting bottom-line results (such as a reduction in the number of incidents caused by third-\nparty damage).\nIn its Responses, BOE stated that it tracks the number of incidents and consequences caused by\nthird-party excavators. It further stated that there were no third-party incidents on the pipeline\nsince it took over the pipeline in 2017. Therefore, BOE asserted, there were no related leaks,\ndamage, or pipeline failures to document, or subsequent data to compare to segment statistics.\nBOE also suggested that it has the discretion to follow the recommendations in API 1162 section\n8.4.4, such as whether to consider the affected public’s perception of the safety of its pipelines.\n2\nSection 195.440(c) states that “operator[s] must follow the general program recommendations,\nincluding baseline and supplemental requirements of API RP 1162.” Thus, it is incorrect for\nRespondent to suggest that it is not required to comply with the recommendations in API 1162\nsection 8.4.4. All recommendations in API 1162 must be followed by operators, unless proper\n2 Section 8.4.4 of API 1162 states that “[o]ne other measure that operators may consider is the affected public’s\nperception of the safety of pipelines.”\n\n\n\njustification is provided. Further, even if there were no third-party incidents on the pipeline\nsince BOE began operation, Respondent must, at a minimum, use that information to determine\nif implementation of the Public Awareness Program is impacting bottom-line results.\nAccordingly, based on a review of the evidence, I find that Respondent violated 49 C.F.R.\n§ 195.440(c) by failing to follow the general program recommendations, including baseline and\nsupplemental requirements of API RP 1162.\nItem 3: The Notice alleged that Respondent violated 49 C.F.R. § 195.440(g), which states:\n§ 195.440 Public awareness.\n(a) . . . .\n(g) The program must be conducted in English and in other languages\ncommonly understood by a significant number and concentration of the\nnon-English speaking population in the operator’s area.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.440(g) by failing to follow its\nwritten public awareness plan that requires a language survey every five years to identify\nlanguages commonly understood by a significant number and concentration of the non-English\nspeaking population in the operator’s area. Specifically, the Notice alleged that BOE failed to\nconduct the required language survey due in 2019. The Notice also alleged that BOE admitted it\nfailed to conduct the required language survey.\nRespondent did not contest this allegation of violation. Accordingly, based on a review of the\nevidence, I find that Respondent violated 49 C.F.R. § 195.440(g) by failing to follow its written\npublic awareness plan that requires a language survey every five years.\nItem 4: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(l)(1)(ii), which states:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . . .\n(l) What records must an operator keep to demonstrate compliance?\n(1) An operator must maintain, for the useful life of the pipeline, records\nthat demonstrate compliance with the requirements of this subpart. At a\nminimum, an operator must maintain the following records for review\nduring an inspection:\n(i) . . . .\n(ii) Documents to support the decisions and analyses, including any\nmodifications, justifications, deviations and determinations made,\nvariances, and actions taken, to implement and evaluate each element of the\nintegrity management program listed in paragraph (f) of this section.\n\n\n\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.452(l)(1)(ii) by failing to maintain\nrecords that indicate it implemented and followed its Integrity Management Program (IMP)\nrequirements for annual calculation of specified performance measures. Specifically, the Notice\nalleged that BOE failed to maintain records of the performance measures as required by Element\n7 of its IMP for 2017, 2018, 2019, and 2020. The Notice included a table of each missing record\nfor 2017 through 2020.\nIn its Responses, Respondent provided additional documentation regarding some of the missing\nrecords. This information is considered below as it relates to the amount of the proposed civil\npenalty. Otherwise, Respondent did not contest this allegation of violation. Accordingly, based\non a review of the evidence, I find that Respondent violated 49 C.F.R. § 195.452(l)(1)(ii) by\nfailing to maintain records that indicate it implemented and followed its IMP requirements for\nannual calculation of specified performance measures.\nItem 5: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(h)(4)(iii)(E), which\nstates:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . . .\n(h) What actions must an operator take to address integrity issues? -\n(1) . . . .\n(4) Special requirements for scheduling remediation -\n(i) . . . .\n(iii) 180-day conditions. Except for conditions listed in paragraph\n(h)(4)(i) or (ii) of this section, an operator must schedule evaluation and\nremediation of the following within 180 days of discovery of the condition:\n(A) . . . .\n(E) An area of general corrosion with a predicted metal loss greater than\n50% of nominal wall.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.452(h)(4)(iii)(E) by failing to\nschedule and remediate a 180-day condition within 180 days of discovery of the condition.\nSpecifically, the Notice alleged that data from a January 22, 2020 in-line inspection (ILI) run on\nBOE’s 16-inch segment of its pipeline revealed a 55.18% metal loss feature (Feature 218)\nlocated on bore pipe in the 1:00 position. BOE discovered this condition on March 26, 2020.\nThis feature qualifies as a 180-day condition under § 195.452(h)(4)(iii)(E). As of May 7, 2021,\nthis feature had not been remediated. The Notice further alleged that BOE explained that the\nremediation had not occurred within the required 180-day time period because that segment of\npipe is buried 26-feet deep and requires an engineering analysis on how to remediate the\nidentified feature. In addition, the Notice alleged that BOE failed to notify PHMSA that it was\nunable to meet the 180-day remediation requirement for Feature 218 as required by\n§ 195.452(h)(3).3\nRespondent did not contest this allegation of violation. Accordingly, based on a review of the\n3 Section 195.452(h)(3) states that “[i]f an operator cannot meet the schedule for any condition, the operator must\nexplain the reasons why it cannot meet the schedule and how the changed schedule will not jeopardize public safety\nor environmental protection.” In addition, § 195.452(h)(1)(i) provides that “[a]n operator must notify PHMSA . . . if\nthe operator cannot meet the schedule for evaluation and remediation required under paragraph (h)(3) . . . .”\n\n\n\nevidence, I find that Respondent violated 49 C.F.R. § 195.452(h)(4)(iii)(E) by failing to schedule\nand remediate a 180-day condition within 180 days of discovery of the condition.\nItem 6: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(l)(1)(ii), which states:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . . .\n(l) What records must an operator keep to demonstrate compliance?\n(1) An operator must maintain, for the useful life of the pipeline, records\nthat demonstrate compliance with the requirements of this subpart. At a\nminimum, an operator must maintain the following records for review\nduring an inspection:\n(i) . . . .\n(ii) Documents to support the decisions and analyses, including any\nmodifications, justifications, deviations and determinations made,\nvariances, and actions taken, to implement and evaluate each element of the\nintegrity management program listed in paragraph (f) of this section.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.452(l)(1)(ii) by failing to maintain\nrecords that demonstrate compliance with § 195.452(f). Specifically, the Notice alleged that\nBOE failed to maintain records documenting (a) the basis of its decision for a reassessment\ninterval of five years; (b) the consideration of facility threats and facility preventative and\nmitigative measures in its joint risk analysis of line pine and facilities; and (c) its emergency flow\nrestricting devices (EFRD) determination.\nRespondent did not contest this allegation of violation as to parts (b) and (c) of this Item and\nprovided additional documentation with regard to part (a). In a written recommendation for final\naction, submitted pursuant to § 190.209(b)(7), the Region Director recommended withdrawing\nthe allegation of violation set forth in part (a). Accordingly, based on a review of the evidence, I\nfind that Respondent violated 49 C.F.R. § 195.452(l)(1)(ii) by failing to maintain records that\ndemonstrate compliance with § 195.452(f) as set forth in parts (b) and (c) of this Item. The\nallegation of violation in part (a) is withdrawn.\nItem 7: The Notice alleged that Respondent violated 49 C.F.R. § 195.573(e), which states:\n§ 195.573 What must I do to monitor external corrosion control?\n(a) . . . .\n(e) Corrective action. You must correct any identified deficiency in\ncorrosion control as required by § 195.401(b). However, if the deficiency\ninvolves a pipeline in an integrity management program under § 195.452,\nyou must correct the deficiency as required by § 195.452(h).\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.573(e) by failing to correct\nidentified deficiencies in corrosion control as required by § 195.401(b). Specifically, the Notice\nalleged that BOE failed to repair inoperable test stations (cathodic protection test leads connected\nto the pipe and held above ground in a stand) 965 and 1729 within a reasonable time. The Notice\nfurther alleged that BOE failed to repair the inoperable test stations, discovered on December 3,\n\n\n\n2017, during the annual cathodic protection survey, until May 7, 2019, which was 520 days (17\nmonths) after discovery of the condition.\nRespondent did not contest this allegation of violation. Accordingly, based on a review of the\nevidence, I find that Respondent violated 49 C.F.R. § 195.573(e) by failing to repair inoperable\ntest stations 965 and 1729 within a reasonable time.\nItem 8: The Notice alleged that Respondent violated 49 C.F.R. § 195.581(b), which states:\n§ 195.581 Which pipelines must I protect against atmospheric\ncorrosion and what coating material may I use?\n(a) . . . .\n(b) Coating material must be suitable for the prevention of atmospheric\ncorrosion.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.581(b) by failing to use a coating\nmaterial suitable for the prevention of atmospheric corrosion on its pipeline. Specifically, the\nNotice alleged that BOE used Polyguard RD-6 as transition zone wraps (corrosion protection at\nsoil-air interfaces) at various locations on its pipeline, but failed to coat the wraps with an\nultraviolet light protection paint to protect it from ultraviolet light deterioration, which is\nidentified in the manufacturer’s installation recommendation on the Polyguard RD-6 product\ndata sheet. In addition, the Notice alleged that BOE failed to coat the transition zones at the\ndischarge of both the main and booster pump stations at Killdeer with a coating suitable for\ntransition zones.\nRespondent did not contest this allegation of violation. Accordingly, based on a review of the\nevidence, I find that Respondent violated 49 C.F.R. § 195.581(b) by failing to use a coating\nmaterial suitable for the prevention of atmospheric corrosion on its pipeline.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nASSESSMENT OF PENALTY\nUnder 49 U.S.C. § 60122, Respondent is subject to an administrative civil penalty not to exceed\n$200,000 per violation for each day of the violation, up to a maximum of $2,000,000 for any\nrelated series of violations.4\nIn determining the amount of a civil penalty under 49 U.S.C. § 60122 and 49 C.F.R. § 190.225, I\nmust consider the following criteria: the nature, circumstances, and gravity of the violation,\nincluding adverse impact on the environment; the degree of Respondent’s culpability; the history\nof Respondent’s prior offenses; any effect that the penalty may have on its ability to continue\ndoing business; the good faith of Respondent in attempting to comply with the pipeline safety\nregulations; and self-disclosure or actions to correct a violation prior to discovery by PHMSA.\n4 These amounts are adjusted annually for inflation. See 49 C.F.R. § 190.223.\n\n\n\nIn addition, I may consider the economic benefit gained from the violation without any reduction\nbecause of subsequent damages, and such other matters as justice may require. The Notice\nproposed a total civil penalty of $61,700 for the violations cited above.\nItem 2: The Notice proposed a civil penalty of $19,000 for Respondent's violation of 49 C.F.R.\n§ 195.440(c), for failing to follow the general program recommendations, including baseline and\nsupplemental requirements of API RP 1162. Respondent asserted that the civil penalty should be\nreduced or withdrawn because it is excessive in light of its pipeline never having third-party\nincidents. Having considered Respondent's argument, I find that it does not warrant a reduction\nto the penalty. The proposed penalty was already based on the violation minimally affecting\npipeline safety and I find the other penalty assessment criteria appropriate reflect the facts\npresented. S\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a civil penalty of $19,000 for violation of 49 C.F.R. § 195.440(c).\nItem 4: The Notice proposed a civil penalty of $16,500 for Respondent's violation of 49 C.F.R.\n§ 195.452(1)(1)(11), for failing to maintain records that indicate it implemented and followed its\nIntegrity Management Program (IMP) requirements for annual calculation of specified\nperformance measures. The proposed civil penalty was based, in part, on four instances of\nviolation reflecting the four years in which records were missing from 2017-2020. Respondent\nargued that the civil penalty should be reduced because it provided documentation for some of\nthe missing IMP performance measures.\nWith respect to the number of instances of the violation, BOE stated it reviewed the IMP\nperformance measures for 2020 and that measures 10, 11, 12, and 15, as identified in the Notice,\nwere not applicable for 2020. It further stated that for measure 5, as identified in the Notice, it\nwould document a 2020 analysis. BOE also stated that it completed another review of its\nperformance measures for 2017 to 2020; that for measures 10, 11, 12 and 15 there were no\nreportable leaks or non-reportable leaks on the pipelines in question since 2017; and that all these\nmeasures would be \"0\" for 2017 to 2020. BOE further stated that for measure 5, the Root Cause\nFailure Analysis program is only activated in the event of failure as described in section 7.7 of its\nIMP, and that, as there were no failures, the Root Cause Analysis Failure program was not\nactivated from 2017-2020; therefore, this measure would also be 0 for those years.\nThe following table reflects the updated information, in bold, provided by BOE in its Responses.\n#\nMeasure and Goal Description\n2017\n2018\n2019\n2020\nMeasure number of IM program activities with\ngoal to ensure processes are monitored.\nMissing\nCompleted\nMissing\nCompleted\ncompleted and IM program improvements are\nimplemented. (meetings and completed IMP\n2\naction items)\neasure the effectiveness of the PA program\nvith the goal of zero (0) leaks due the third\nMissing\nCompleted\nMissing\nCompleted\nparty damage.\n5 Violation Report at 11-15.\n\n\n\n3 Measure number of action items from internal\naudits with goal to ensure processes are\nmonitored, completed and IM program\nimprovements are implemented.\n4 Measure number of action items from external\naudits with goal to ensure processes are\nmonitored, completed and IM program\nimprovements are implemented.\n5 Measure root cause failure analysis program for\nsystematic problems to ensure processes are\nmonitored, completed, and IM program\nimprovements are implemented.\n6 Measure number of annual CP surveys\nreadings below 850 mV criteria to ensure\nprocesses are monitored, completed, and IM\nprogram improvements are implemented.\n7 Measure pipeline patrol reports with no \"One\nCall\" notifications to ensure processes are\nmonitored, completed, and IM program\nimprovements are implemented.\n8 Measure number of exposed pipe reports to\nensure processes are monitored, completed,\nand IM program improvements are\nimplemented.\n9 Measure number of hydro test leaks to ensure\nprocesses are monitored, completed, and IM\nprogram improvements are implemented.\nMissing Missing Missing Completed\nMissing Missing Missing Completed\nProvided Provided Provided Provided\nMissing Missing Missing Completed\nMissing Missing Missing Completed\nMissing Missing Missing Completed\nMissing Missing Missing Completed\n10 11 12 13 14 15 Measure number of reportable leaks (i.e., leaks\ngreater than 5 bbl to land) to ensure processes\nare monitored, completed, and IM program\nimprovements are implemented.\nMeasure number of leaks due to corrosion to\nensure processes are monitored, completed,\nand IM program improvements are\nimplemented.\nMeasure number of leaks due to third party\ndamage to ensure processes are monitored,\ncompleted, and IM program improvements are\nimplemented.\nMeasure number of miles of pipeline assessed\nto ensure processes are monitored, completed,\nand IM program improvements are\nimplemented.\nNumber of anomalies found requiring repair or\nmitigation to ensure processes are monitored,\ncompleted, and IM program improvements are\nimplemented.\nLeaks due to equipment failure. Provided Provided Provided Provided\nProvided Provided Provided Provided\nProvided Provided Provided Provided\nMissing Missing Missing Completed\nMissing Missing Missing Completed\nProvided Provided Provided Provided\nAs evident from the table, BOE did not provide documentation for numerous measures. For\n2017, it is missing measures 1, 2, 3, 4, 6, 7, 8, 9, 13, and 14. For 2018, it is missing measures 3,\n4, 6, 7, 8, 9, 13, and 14. For 2019, it is missing measures 1, 2, 3, 4, 6, 7, 8, 9, 13, and 14. BOE\ncompleted all measures for 2020. Accordingly, I find a reduction in the instances of allegation\nfrom four to three is warranted because BOE provided the missing documentation for 2020.\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a reduced civil penalty of $16,200 for violation of 49 C.F.R. § 195.452(l)(1)(ii).\nItem 5: The Notice proposed a civil penalty of $6,900 for Respondent’s violation of 49 C.F.R.\n\n\n\n§ 195.452(h)(4)(iii)(E), for failing to schedule and remediate a 180-day condition within 180\ndays of discovery of the condition. Respondent requested reduction of the civil penalty for two\nreasons.\nWith respect to circumstances, Respondent asserted the civil penalty should be reduced because\nit self-reported the violation. However, Respondent already received credit for self-reporting this\nviolation in the initial proposed civil penalty calculation. Therefore, no further reduction is\nwarranted for Respondent’s self-reporting.\nWith respect to good faith, Respondent asserted the civil penalty should be reduced because it\nwas unable to remediate the condition within 180 days. Respondent contended that it discovered\nthe condition during winter and needed to conduct an engineering dig. This is not a reasonable\njustification for non-compliance. An operator must complete remediation of a condition\naccording to the specified schedule and § 195.452(h)(1)(i) and (h)(3) require an operator notify\nPHMSA if it is unable to remediate a 180-day condition within the required time. Respondent\nfailed to notify PHMSA it was unable to remediate this deficiency and provided no reasonable\njustification for its failure to do so. Therefore, I do not find reason to reduce the penalty under\nthe good faith factor.\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a civil penalty of $6,900 for violation of 49 C.F.R. § 195.452(h)(4)(iii)(E).\nItem 7: The Notice proposed a civil penalty of $19,300 for Respondent’s violation of 49 C.F.R.\n§ 195.573(e), for failing to correct identified deficiencies in corrosion control within a reasonable\ntime as required by § 195.401(b). Respondent requested a reduction of the civil penalty.\nWith respect to culpability, Respondent asserted the civil penalty should be reduced because it\nidentified and corrected the violation in March 2019 before PHMSA’s inspection. I find that the\nViolation Report was incorrectly marked with respect to culpability. It should have been marked\n“After the operator found the non-compliance, the operator took documented action to address\nthe cause of the non-compliance, and corrected the non-compliance before PHMSA learned of\nthe violation. (Does not apply to operator post-accident/incident enforcement actions.).”6\nAccordingly, having reviewed the record and considered the updated assessment criteria, I\nreduce the proposed civil penalty to $0 for violation of 49 C.F.R. § 195.573(e).\n7\nIn summary, having reviewed the record and considered the assessment criteria for each of the\nItems cited above, I assess Respondent a total civil penalty of $42,100.\nPayment of the civil penalty must be made within 20 days after receipt of this Final Order.\n6 Violation Report, at 46.\n7 In its written recommendation for final action, the Region Director stated that if the civil penalty is reduced to a de\nminimis amount, the violation should be changed to a warning item. The appropriate disposition, however, is not to\nchange the violation, but to reduce the civil penalty to $0. See, e.g., Flint Hills Resources, CPF No. 3-2020-5021,\n2021 WL 4055259, Item 1 (Aug. 23, 2021); Tallgrass Energy Partners, LP, CPF No. 3-2020-1008, 2021 WL\n4055256, Item 2 (Jul. 2, 2021).\n\n\n\nFederal regulations (49 C.F.R. § 89.21(b)(3)) require such payment to be made by wire transfer\nthrough the Federal Reserve Communications System (Fedwire), to the account of the U.S.\nTreasury. Detailed instructions are contained in the enclosure. Questions concerning wire\ntransfers should be directed to: Financial Operations Division (AMK-325), Federal Aviation\nAdministration, Mike Monroney Aeronautical Center, 6500 S MacArthur Blvd, Oklahoma City,\nOklahoma 79169. The Financial Operations Division telephone number is (405) 954-8845.\nFailure to pay the $42,100 civil penalty will result in accrual of interest at the current annual rate\nin accordance with 31 U.S.C. § 3717, 31 C.F.R. § 901.9 and 49 C.F.R. § 89.23. Pursuant to\nthose same authorities, a late penalty charge of six percent (6%) per annum will be charged if\npayment is not made within 110 days of service. Furthermore, failure to pay the civil penalty\nmay result in referral of the matter to the Attorney General for appropriate action in a district\ncourt of the United States.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Items 1, 2, 3, 4, 6, and 8 in the Notice\nfor violations of 49 C.F.R. §§ 195.440(c), 195.440(c), 195.440(g), 195.452(l)(1)(ii),\n195.452(l)(1)(ii), 195.581(b), respectively. Under 49 U.S.C. § 60118(a), each person who\nengages in the transportation of hazardous liquids or who owns or operates a pipeline facility is\nrequired to comply with the applicable safety standards established under chapter 601. The\nDirector indicates that Respondent has taken the following actions specified in the proposed\ncompliance order:\n1. With respect to the violation of § 195.440(c) (Item 1), Respondent has conducted\nan effectiveness evaluation of the affected public audience in its August 2021 Public\nAwareness Effectiveness Evaluation and provided supporting documentation.\n2. With respect to the violation of § 195.440(c) (Item 2), Respondent has measured\nbottom line results as required by section 8.4.4 of API 1162 and provided supporting\ndocumentation.\n3. With respect to the violation of § 195.440(g) (Item 3), Respondent has conducted\na language survey and provided supporting documentation.\n4. With respect to the violation of § 195.452(l)(1)(ii) (Item 4), Respondent has\ncompleted the 2020 IMP performance measure calculation and provided supporting\ndocumentation.\n5. With respect to the violation of § 195.452(l)(1)(ii) (Item 6), Respondent has\nprovided records documenting (i) the basis of its decision for a reassessment interval\nof five years; (ii) the consideration of facility threats and facility preventative and\nmitigative measures in its joint risk analysis of line pine and facilities; and (iii) the\nsummary, conclusions, and recommendations from the EFRD study.\n6. With respect to the violation of § 195.581(b) (Item 8), Respondent has provided\n\n\n\nrecords indicating it has (i) coated the Polyguard RD-6 used as transition zone wrap\nto protect it from ultraviolet light deterioration as required by the product data sheet;\n(ii) coated the transition zones at the discharge of both the main and booster pumps at\nthe Killdeer station with a wrap suitable for the prevention of atmospheric corrosion;\nand (iii) adequately protected the carrier pipe from contact with the supports at both\nthe Killdeer main and booster pump stations.\nAccordingly, I find that compliance has been achieved with respect to these violations.\nTherefore, the compliance terms proposed in the Notice are not included in this Order.\nUnder 49 C.F.R. § 190.243, Respondent may submit a Petition for Reconsideration of this Final\nOrder to the Associate Administrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey\nAvenue, SE, East Building, 2nd Floor, Washington, DC 20590, with a copy sent to the Office of\nChief Counsel, PHMSA, at the same address. The written petition must be received no later than\n20 days after receipt of the Final Order by Respondent. Any petition submitted must contain a\nbrief statement of the issue(s) and meet all other requirements of 49 C.F.R. § 190.243. The filing\nof a petition automatically stays the payment of any civil penalty assessed. The other terms of\nthe order, including any corrective action, remain in effect unless the Associate Administrator,\nupon request, grants a stay. If Respondent submits payment of the civil penalty, the Final Order\nbecomes the final administrative decision and the right to petition for reconsideration is waived.\nThe terms and conditions of this Final Order are effective upon service in accordance with 49\nC.F.R. § 190.5.\nAugust 18, 2022\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":35377}