{"operation":"document","citation":"CPF 32021059NOPV","title":"DAKOTA MIDSTREAM — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2021-12-30","effective_on":null,"summary":"CLOSED notice of probable violation citing 194.107(c)(1)(ix), 194.117(b)(1), 195.208, 195.264(b)(1)(i), 195.402(c)(13), 195.420(b), 195.428(a), 195.430, 195.436, 195.438, 195.440(c), 195.440(d), 195.573(a)(1), 195.573(e), 195.581(a), 195.61(b).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-32021059nopv.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-32021059nopv.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-32021059nopv","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/32021059NOPV","body":"Notice of Probable Violation involving DAKOTA MIDSTREAM. PHMSA's enforcement data identifies the cited regulations as 194.107(c)(1)(ix),  194.117(b)(1),  195.208,  195.264(b)(1)(i),  195.402(c)(13),  195.420(b),  195.428(a),  195.430,  195.436,  195.438,  195.440(c),  195.440(d),  195.573(a)(1),  195.573(e),  195.581(a),  195.61(b). The case was opened on 2021-12-30 and is reported as closed as of 2023-08-08. Proposed civil penalty: $204,000. Assessed civil penalty: $204,000. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n32021059NOPV_Closure Letter_08082023_(21-200404).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021059NOPV/32021059NOPV_Closure%20Letter_08082023_(21-200404).pdf\n\n32021059NOPV_Closure Letter_08082023_(21-200404)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021059NOPV/32021059NOPV_Closure%20Letter_08082023_(21-200404)_text.pdf\n\n32021059NOPV_Decision on Petition for Reconsideration_12052022_(21-200404).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021059NOPV/32021059NOPV_Decision%20on%20Petition%20for%20Reconsideration_12052022_(21-200404).pdf\n\n32021059NOPV_Decision on Petition for Reconsideration_12052022_(21-200404)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021059NOPV/32021059NOPV_Decision%20on%20Petition%20for%20Reconsideration_12052022_(21-200404)_text.pdf\n\n32021059NOPV_Final Order_08302022_(21-200404).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021059NOPV/32021059NOPV_Final%20Order_08302022_(21-200404).pdf\n\n32021059NOPV_Final Order_08302022_(21-200404)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021059NOPV/32021059NOPV_Final%20Order_08302022_(21-200404)_text.pdf\n\n32021059NOPV_Operator Petition for Reconsideration_09192022_(21-200404).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021059NOPV/32021059NOPV_Operator%20Petition%20for%20Reconsideration_09192022_(21-200404).pdf\n\n32021059NOPV_Operator Response to Notice_01302022_(21-200404).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021059NOPV/32021059NOPV_Operator%20Response%20to%20Notice_01302022_(21-200404).pdf\n\n32021059NOPV_PCP PCO_12302021_(21-200404).pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021059NOPV/32021059NOPV_PCP%20PCO_12302021_(21-200404).pdf\n\n32021059NOPV_PCP PCO_12302021_(21-200404)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/32021059NOPV/32021059NOPV_PCP%20PCO_12302021_(21-200404)_text.pdf\n\n32021059NOPV_Final Order_08302022_(21-200404)_text.pdf\n\nAugust 30, 2022\nVIA ELECTRONIC MAIL TO: heath@dakota-midstream.com and tim@dakota-\nmidstream.com\nMr. Heath Norman & Mr. Tim Reynolds\nCo-Chief Executive Officers\nDakota Midstream, LLC\n708 Main Street, 10th Floor,\nHouston, Texas 77002\nRe: CPF No. 3-2021-059-NOPV\nDear Mr. Norman and Mr. Reynolds:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation, assesses a civil penalty of $204,000, and specifies actions that need to be taken by\nDakota Midstream, LLC to comply with the pipeline safety regulations. The penalty payment\nterms are set forth in the Final Order. When the civil penalty has been paid and the terms of the\ncompliance order completed, as determined by the Director, Central Region, this enforcement\naction will be closed. Service of the Final Order by e-mail is effective upon the date of\ntransmission and acknowledgement 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\nEnclosure\ncc: Mr. Gregory A. Ochs, Director, Central Region, Office of Pipeline Safety, PHMSA\nMr. Kristopher Coe, P.E., Project Manager, Dakota Midstream, LLC,\nkristopher@dakota-midstream.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 )\nDakota Midstream, LLC, ) CPF No. 3-2021-059-NOPV\n)\n)\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nOn March 18, April 8, May 18-20, and May 27, 2021, pursuant to 49 U.S.C. § 60117,\nrepresentatives of the Pipeline and Hazardous Materials Safety Administration (PHMSA), Office\nof Pipeline Safety (OPS), conducted an on-site pipeline safety inspection of the facilities and\nrecords of Dakota Midstream, LLC (Dakota Midstream or Respondent) in Alexander, North\nDakota. Dakota Midstream owns and operates approximately 65 miles of pipeline in the Bakken\nregion.1\nAs a result of the inspection, the Director, Central Region, OPS (Director), issued to Respondent,\nby letter dated December 30, 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 Dakota Midstream had committed sixteen (16) violations of 49 C.F.R.\nParts 194 and 195 and proposed assessing a civil penalty of $204,000 for the alleged violations.\nThe Notice also proposed ordering Respondent to take certain measures to correct the alleged\nviolations.\nDakota Midstream responded to the Notice by letter dated January 30, 2022 (Response) and\nsubmitted additional correspondence on March 4 and March 18, 2022. The company contested\nseveral of the allegations, offered additional information in response to the Notice, and requested\nthat the proposed civil penalty be reduced. Respondent did not request a hearing and therefore\nhas waived its right to one.\nFINDINGS OF VIOLATION\nThe Notice alleged that Respondent violated 49 C.F.R. Parts 194 and 195, as follows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 194.117(b)(1), which states:\n§ 194.117 Training.\n1 Dakota Midstream website, available at http://dakota-midstream.com/about/ (last accessed May 25, 2022).\n\n\n\n(a) . . . .\n(b) Each operator shall maintain a training record for each individual\nthat has been trained as required by this section. These records must be\nmaintained in the following manner as long as the individual is assigned\nduties under the response plan:\n(1) Records for operator personnel must be maintained at the\noperator’s headquarters;\nThe Notice alleged that Respondent violated 49 C.F.R. § 194.117(b)(1) by failing to maintain\ntraining records for each individual assigned duties under the response plan at the operator’s\nheadquarters. Specifically, the Notice alleged that Dakota Midstream failed to maintain training\nrecords for individual qualifications, tabletop drills, and unannounced PREP drills for 2017-\n2020.2\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 194.117(b)(1) by failing to maintain\ntraining records for each individual assigned duties under the response plan at the operator’s\nheadquarters.\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. § 194.107(c)(1)(ix), which states:\n§ 194.107 General response plan requirements.\n(a) . . . .\n(c) Each response plan must include:\n(1) A core plan consisting of –\n(i) . . . .\n(ix) Drill program – an operator will satisfy the requirement for a drill\nprogram by following the National Preparedness for Response Exercise\nProgram (PREP) guidelines. An operator choosing not to follow PREP\nguidelines must have a drill program that is equivalent to PREP. The\noperator must describe the drill program in the response plan and OPS will\ndetermine if the program is equivalent to PREP.\nThe Notice alleged that Respondent violated 49 C.F.R. § 194.107(c)(1)(ix) by failing to have a\nresponse plan that included a drill program following PREP guidelines, or a program that is\nequivalent to PREP. Specifically, the Notice alleged that Dakota Midstream failed to conduct\nequipment deployment PREP drills in 2017, 2018, and 2019.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 194.107(c)(1)(ix) by failing to have\na response plan that included a drill program following PREP guidelines, or a program that is\nequivalent to PREP.\nItem 3: The Notice alleged that Respondent violated 49 C.F.R. § 195.61(b), which states:\n2 Dakota Midstream did, however, have a record of a January 4, 2020 unannounced PREP drill.\n\n\n\n§ 195.61 National Pipeline Mapping System.\n(a) . . . .\n(b) This information must be submitted each year, on or before June\n15, representing assets as of December 31 of the previous year. If no\nchanges have occurred since the previous year's submission, the operator\nmust refer to the information provided in the NPMS Operator Standards\nmanual available at www.npms.phmsa.dot.gov or contact the PHMSA\nGeographic Information Systems Manager at (202) 366-4595.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.61(b) by failing to submit to\nPHMSA geospatial data for its facility each year, on or before June 15, representing assets as of\nDecember 31 of the previous year. Specifically, the Notice alleged that Dakota Midstream failed\nto submit geospatial data for 2018 and 2019, and submitted its 2020 data late.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.61(b) by failing to submit to\nPHMSA geospatial data for its facility each year, on or before June 15, representing assets as of\nDecember 31 of the previous year.\nItem 4: The Notice alleged that Respondent violated 49 C.F.R. § 195.208, which states:\n§ 195.208 Welding of supports and braces.\nSupports or braces may not be welded directly to pipe that will be\noperated at a pressure of more than 100 p.s.i. (689 kPa) gage.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.208 by welding braces or supports\ndirectly to pipe that will be operated at a pressure of more than 100 psi gage (PSIG).\nSpecifically, the Notice alleged that during the inspection, PHMSA observed supports welded\ndirectly to the pipeline, located down the middle of the 10 Spackler tanks and feeding all the\ntanks.\nIn its Response, Dakota Midstream contested the allegation of violation. Specifically,\nRespondent noted that this pipeline at the above-referenced location has a pressure control valve\nset to 75 PSIG and will never operate above 100 PSIG. Response at 3 and Exhibit 1. Pursuant\nto § 195.208, operators may not weld supports to pipe that will be operated at a pressure of more\nthan 100 PSIG. Since Dakota Midstream restricts the pressure on this line to a maximum\npressure of 75 PSIG, and there is nothing in the record to indicate that the pressure control valve\nwas malfunctioning, improperly calibrated, or otherwise not accurately restricting the pressure\non this line, I find that this pipeline is not being operated above 100 PSIG. Since the pipeline\nwill not be operated above 100 PSIG, the requirements set forth in § 195.208 are not applicable.\nAccordingly, after considering all of the evidence, I find that no basis for finding a violation.\nBased upon the foregoing, I hereby order that Item 4 be withdrawn.\nItem 5: The Notice alleged that Respondent violated 49 C.F.R. § 195.264(b)(1)(i), which states:\n\n\n\n§ 195.264 Impoundment, protection against entry, normal/emergency\nventing or pressure/vacuum relief for aboveground breakout tanks.\n(a) . . . .\n(b) After October 2, 2000, compliance with paragraph (a) of this\nsection requires the following for the aboveground breakout tanks\nspecified:\n(1) For tanks built to API Spec 12F, API Std 620, and others (such as\nAPI Std 650 (or its predecessor Standard 12C)), the installation of\nimpoundment must be in accordance with the following sections of\nNFPA-30 (incorporated by reference, see § 195.3);\n(i) Impoundment around a breakout tank must be installed in\naccordance with section 22.11.2;\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.264(b)(1)(i) by failing to install the\nimpoundment around its aboveground breakout tank in accordance with Section 22.11.2 of\nNFPA-30. Specifically, the Notice alleged that Dakota Midstream failed to establish a one\npercent slope away from the tanks at both the Wheatland and Spackler tank farms, despite the\nrequirements of Section 22.11.2.1 requiring a one percent or greater slope the first 50 feet away\nfrom the tank or to the dike base, whichever is less.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.264(b)(1)(i) by failing to install\nthe impoundment around its aboveground breakout tank in accordance with Section 22.11.2 of\nNFPA-30.\nItem 6: The Notice alleged that Respondent violated 49 C.F.R. § 195.402(c)(13), which states:\n§ 195.402 Procedural manual for operations, maintenance, and\nemergencies.\n(a) . . .\n(c) Maintenance and normal operations. The manual required by\nparagraph (a) of this section must include procedures for the following to\nprovide safety during maintenance and normal operations:\n(1) . . .\n(13) Periodically reviewing the work done by operator personnel to\ndetermine the effectiveness of the procedures used in normal operation\nand maintenance and taking corrective action where deficiencies are\nfound.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.402(c)(13) by failing to have and\nfollow a manual to provide safety during maintenance and normal operations that included\nperiodically reviewing the work done by operator personnel to determine the effectiveness of the\nprocedures and taking corrective action where deficiencies are found. Specifically, the Notice\nalleged that Dakota Midstream failed to produce records during the inspection evidencing\ncompletion of effectiveness reviews for 2019 and 2020.\n\n\n\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.402(c)(13) by failing to have\nand follow a manual to provide safety during maintenance and normal operations that included\nperiodically reviewing the work done by operator personnel to determine the effectiveness of the\nprocedures and taking corrective action where deficiencies are found.\nItem 7: The Notice alleged that Respondent violated 49 C.F.R. § 195.420(b), which states:\n§ 195.420 Valve maintenance.\n(a) . . . .\n(b) Each operator shall, at intervals not exceeding 7 1/2 months, but at\nleast twice each calendar year, inspect each mainline valve to determine\nthat it is functioning properly.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.420(b) by failing to inspect each\nmainline valve to determine that it is functioning properly at intervals not exceeding 7 ½ months\nbut at least twice each calendar year. Specifically, the Notice alleged that Dakota Midstream\nfailed to conduct inspections on each mainline block valve on the Low Rider pipeline at the\nrequired intervals for calendar years 2019 and 2020, resulting in eleven missed inspections.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.420(b) by failing to inspect each\nmainline valve to determine that it is functioning properly at intervals not exceeding 7 ½ months\nbut at least twice each calendar year.\nItem 8: The Notice alleged that Respondent violated 49 C.F.R. § 195.428(a), which states:\n§ 195.428 Overpressure safety devices and overfill protection systems.\n(a) Except as provided in paragraph (b) of this section, each operator\nshall, at intervals not exceeding 15 months, but at least once each calendar\nyear, or in the case of pipelines used to carry highly volatile liquids, at\nintervals not to exceed 7 1/2 months, but at least twice each calendar year,\ninspect and test each pressure limiting device, relief valve, pressure\nregulator, or other item of pressure control equipment to determine that it\nis functioning properly, is in good mechanical condition, and is adequate\nfrom the standpoint of capacity and reliability of operation for the service\nin which it is used.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.428(a) by failing to inspect and test\neach pressure limiting device, relief valve, pressure regulator, or other item of pressure control\nequipment to determine that it is functioning properly, is in good mechanical condition, and is\nadequate from the standpoint of capacity and reliability of operation for the service in which it is\nused at intervals not exceeding 15 months, but at least once each calendar year. Specifically, the\nNotice alleged that Dakota Midstream failed to conduct inspections and tests on overpressure\nprotection devices located on the Low Rider pipeline, the Spackler and Wheatland tank farms,\nand Spackler Pump Station for calendar years 2019 and 2020. During the inspection, PHMSA\nreviewed certain records, but ultimately could not determine compliance because they failed to\n\n\n\ninclude critical safety information, including “as found” pressures and “as left” pressures, to\ndetermine if the devices were functioning properly, in good mechanical condition, and adequate\nfrom the standpoint of capacity and reliability of operation for the service in which it is used.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.428(a) by failing to inspect and\ntest each pressure limiting device, relief valve, pressure regulator, or other item of pressure\ncontrol equipment to determine that it is functioning properly, is in good mechanical condition,\nand is adequate from the standpoint of capacity and reliability of operation for the service in\nwhich it is used at intervals not exceeding 15 months, but at least once each calendar year.\nItem 9: The Notice alleged that Respondent violated 49 C.F.R. § 195.430, which states:\n§ 195.430 Firefighting equipment.\nEach operator shall maintain adequate firefighting equipment at each\npump station and breakout tank area. The equipment must be -\n(a) In proper operating condition at all times;\n(b) Plainly marked so that its identity as firefighting equipment is\nclear; and\n(c) Located so that it is easily accessible during a fire.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.430 by failing to maintain adequate\nfirefighting equipment at each pump station and breakout tank area. Specifically, the Notice\nalleged that Dakota Midstream failed to have adequate firefighting equipment at the Wheatland\ntank farm.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.430 by failing to maintain\nadequate firefighting equipment at each pump station and breakout tank area.\nItem 10: The Notice alleged that Respondent violated 49 C.F.R. § 195.436, which states:\n§ 195.436 Security of facilities.\nEach operator shall provide protection for each pumping station and\nbreakout tank area and other exposed facility (such as scraper traps) from\nvandalism and unauthorized entry.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.436 by failing to provide protection\nfor each pumping station and breakout tank and other exposed facility from vandalism and\nunauthorized entry. Specifically, the Notice alleged that Dakota Midstream failed to have a\nfence or other protection from unauthorized entry.3\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.436 by failing to provide\nprotection for each pumping station and breakout tank and other exposed facility from vandalism\n3 The Notice also alleged that Dakota Midstream failed to lock valves.\n\n\n\nand unauthorized entry.\nItem 11: The Notice alleged that Respondent violated 49 C.F.R. § 195.438, which states:\n§ 195.438 Smoking or open flames.\nEach operator shall prohibit smoking and open flames in each pump\nstation area and each breakout tank area where there is a possibility of the\nleakage of a flammable hazardous liquid or of the presence of flammable\nvapors.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.438 by failing to prohibit smoking\nand open flames in each pump station area and each breakout tank area where there is a\npossibility of the leakage of a flammable hazardous liquid or of the presence of flammable\nvapors. Specifically, the Notice alleged that Dakota Midstream failed to have a “No Smoking”\nsign at the Wheatland tank farm, or otherwise have identifiable prohibitions on smoking at this\nlocation.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.438 by failing to prohibit\nsmoking and open flames in each pump station area and each breakout tank area where there is a\npossibility of the leakage of a flammable hazardous liquid or of the presence of flammable\nvapors.\nItem 12: The Notice alleged that Respondent violated 49 C.F.R. § 195.440(d), which states:\n§ 195.440 Public awareness.\n(a) . . . .\n(d) The operator’s program must specifically include provisions to\neducate the public, appropriate government organizations, and persons\nengaged in excavation related activities on:\n(1) Use of a one-call notification system prior to excavation and other\ndamage prevention activities;\n(2) Possible hazards associated with unintended releases from a\nhazardous liquid or carbon dioxide pipeline facility;\n(3) Physical indications that such a release may have occurred;\n(4) Steps that should be taken for public safety in the event of a\nhazardous liquid or carbon dioxide pipeline release; and\n(5) Procedures to report such an event.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.440(d) by failing to have a public\nawareness program that specifically included provisions to educate the public, appropriate\ngovernment organizations, and persons engaged in excavation activities on the matters set forth\nin § 195.440(d)(1)-(5). Specifically, the Notice alleged that Dakota Midstream’s public\nawareness program in 2018, 2019 and 2020 failed to educate all the appropriate parties, and\nfailed to include all the requisite information.\n4\n4 See Notice at 6 (listing out each deficiency).\n\n\n\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.440(d) by failing to have a\npublic awareness program that specifically included provisions to educate the public, appropriate\ngovernment organizations, and persons engaged in excavation activities on the matters set forth\nin § 195.440(d)(1)-(5).\nItem 13: 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\nto why compliance with all or certain provisions of the recommended\npractice is 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, unless the operator provides justification in its program or procedural manual as to why\ncompliance with all or certain provisions of the recommended practice is not practicable and not\nnecessary for safety. Specifically, the Notice alleged that Dakota Midstream failed to follow API\nRP 1162 Section 8.4, which requires an effectiveness evaluation of all four audiences every four\nyears. During the inspection, Dakota Midstream did not produce any records demonstrating that\nit completed an effectiveness review pursuant to API RP 1162, Section 8.4.5\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find 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.\nItem 14: The Notice alleged that Respondent violated 49 C.F.R. § 195.573(a)(1), which states:\n§ 195.573 What must I do to monitor external corrosion control?\n(a) Protected pipelines. You must do the following to determine\nwhether cathodic protection required by this subpart complies with §\n195.571:\n(1) Conduct tests on the protected pipeline at least once each calendar\nyear, but with intervals not exceeding 15 months. However, if tests at\nthose intervals are impractical for separately protected short sections of\nbare or ineffectively coated pipelines, testing may be done at least once\nevery 3 calendar years, but with intervals not exceeding 39 months.\n5 Dakota Midstream did not otherwise provide justification in its public awareness program or procedural manual as\nto why compliance with API RP 1162 Section 8.4 is not practicable and not necessary for safety.\n\n\n\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.573(a)(1) by failing to conduct\ntests on protected pipeline at least once each calendar year, but with intervals not exceeding 15\nmonths, to determine whether cathodic protection required by Subpart H complies with\n§ 195.571. Specifically, the Notice alleged that Dakota Midstream failed to conduct the annual\ncathodic protection survey on the Wheatland tanks during the December 8, 2018 survey.\nRespondent contested this allegation of violation. Specifically, Dakota Midstream stated that\ncathodic protection readings could not be taken during the December 8, 2018 survey because it\nwas determined that the ground was too frozen to achieve effective measurements. Response at\n9. In April 2019, when ground conditions improved, a cathodic protection survey was\ncompleted at the Wheatland breakout tanks. Id.\nThe requirements set forth in § 195.573(a)(1) clearly state that these tests must be completed at\nleast once each calendar year, but with intervals not exceeding 15 months. By failing to perform\nthe cathodic protection survey in December 2018, Dakota Midstream failed to conduct the\nrequisite testing for calendar year 2018. Performing the next annual cathodic protection survey\nin 2019 does not negate the company’s failure to conduct testing in calendar year 2018.\nAccordingly, based upon a review of all of the evidence, I find that Respondent violated 49\nC.F.R. § 195.573(a)(1) by failing to conduct tests on protected pipeline at least once each\ncalendar year, but with intervals not exceeding 15 months, to determine whether cathodic\nprotection required by Subpart H complies with § 195.571.\nItem 15: 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 its corrosion control as required by § 195.401(b).\n6 Specifically, the\nNotice alleged that on December 8, 2018, Dakota Midstream learned that cathodic protection on\nits Spackler tanks was inadequate, but failed to correct the deficiency by the next inspection\ncycle on April 17, 2019. Further, on April 17, 2019, Dakota Midstream learned that cathodic\nprotection on both Wheatland tanks was inadequate, but failed to correct it by the next inspection\ncycle on June 27, 2020.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.573(e) by failing to correct\n6 49 C.F.R. § 195.401(b)(1) requires that, “[w]henever an operator discovers any condition that could adversely\naffect the safe operation of its pipeline system, it must correct the condition within a reasonable time. However, if\nthe condition is of such a nature that it presents an immediate hazard to persons or property, the operator may not\noperate the affected part of the system until it has corrected the unsafe condition.”\n\n\n\nidentified deficiencies in its corrosion control as required by § 195.401(b).\nItem 16: The Notice alleged that Respondent violated 49 C.F.R. § 195.581(a), which states:\n§ 195.581 Which pipelines must I protect against atmospheric\ncorrosion and what coating material may I use?\n(a) You must clean and coat each pipeline or portion of pipeline that is\nexposed to the atmosphere, except pipelines under paragraph (c) of this\nsection.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.581(a) by failing to clean and coat\neach pipeline or portion of pipeline that is exposed to the atmosphere. Specifically, the Notice\nalleged that during the inspection, PHMSA observed large portions of insufficiently coated pipe\nat the Spackler pump station.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.581(a) by failing to clean and\ncoat each pipeline or portion of pipeline that is exposed to the atmosphere.\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.7\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.\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 $204,000 for the violations cited above.\nItem 1: The Notice proposed a civil penalty of $24,100 for Respondent’s violation of 49 C.F.R.\n§ 194.117(b)(1) for failing to maintain training records for each individual assigned duties under\nthe response plan at the operator’s headquarters. The Notice included the instruction that, “[i]f\nyou are a small business and would like PHMSA to consider your classification as such in this\nenforcement action including, under appropriate circumstances, a potential penalty reduction or\nwaiver under Section 223 of the Small Business Regulatory Enforcement Fairness Act\n7 These amounts are adjusted annually for inflation. See 49 C.F.R. § 190.223.\n\n\n\n(SBREFA), please respond with the relevant information you wish to be considered. Refer to 13\nCFR Part 121 for more information about small business size eligibility provisions and\nstandards.” Notice at Response Options for Pipeline Operators in Enforcement Proceedings.\nIn its Response, Dakota Midstream requested a reduction of the proposed civil penalty amount\nbecause it will have an overly punitive effect on its ability to operate as a Small Business, as\nclassified by the US Small Business Administration. Response at 11. On March 4, 2022, Dakota\nMidstream clarified to PHMSA that it would be financially able to pay the proposed civil\npenalty, but the penalty amount should be lowered due to the fact that it was a small business and\nthe penalty amount would disproportionately affect it as compared to other larger operators\n(Letter). Letter at 1. On March 18, 2022, upon request from OPS, Dakota Midstream provided\nan income statement for December 2020 to November 2021.\nUnder Section 223 of SBREFA, “[u]nder appropriate circumstances, an agency may consider\nability to pay in determining penalty assessments on small entities.” Pursuant to § 190.225(a)(5),\nin determining the amount of a civil penalty, I must consider “[t]he effect on the respondent’s\nability to continue in business.” In its Letter, Dakota Midstream informed PHMSA that it could\npay the penalty amount, and did not provide any information on how the proposed penalty would\naffect its ability to continue in business. Respondent’s income statement also does not provide\nsufficient information on its ability to continue in business. Therefore, I find no reason to reduce\nthe civil penalty based on Dakota Midstream’s ability to continue in business.\nIn regard to the remaining civil penalty assessment factors for Item 1, I see no reason to reduce\nthe penalty amount. This was a record-keeping violation that was discovered by PHMSA.\nAlthough pipeline safety was minimally affected, Dakota Midstream failed to comply with an\napplicable requirement and did not provide a reasonable justification for its noncompliance.\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a civil penalty of $24,100 for violation of 49 C.F.R. § 194.117(b)(1).\nItem 2: The Notice proposed a civil penalty of $27,600 for Respondent’s violation of 49 C.F.R.\n§ 194.107(c)(1)(ix) for failing to have a response plan that included a drill program following\nPREP guidelines, or a program that is equivalent to PREP. For the reasons set forth above, I do\nnot believe a penalty reduction for Dakota Midstream’s ability to continue in business is\nwarranted.\nIn regard to the remaining civil penalty assessment factors for Item 2, I see no reason to reduce\nthe penalty amount. This was an activities violation that was discovered by PHMSA. Although\npipeline safety was minimally affected, Dakota Midstream failed to comply with an applicable\nrequirement and did not provide a reasonable justification for its noncompliance. Accordingly,\nhaving reviewed the record and considered the assessment criteria, I assess Respondent a civil\npenalty of $27,600 for violation of 49 C.F.R. § 194.107(c)(1)(ix).\nItem 3: The Notice proposed a civil penalty of $28,300 for Respondent’s violation of 49 C.F.R.\n§ 195.61(b) for failing to submit to PHMSA geospatial data for its facility each year, on or\nbefore June 15, representing assets as of December 31 of the previous year. For the reasons set\nforth above, I do not believe a penalty reduction for Dakota Midstream’s ability to continue in\nbusiness is warranted.\n\n\n\nIn regard to the remaining civil penalty assessment factors for Item 3, I see no reason to reduce\nthe penalty amount. In its Response, Dakota Midstream requested a further reduction due to the\ntechnical nature of the violations, and the fact that the company corrected the 2019 error\npromptly. The Violation Report accurately notes that this is an activities violation, even though\nRespondent considered it merely a “technical” violation. Violation Report at 22. Further, the\ncompany did not promptly remedy the 2019 violation. It waited approximately six months\nbefore submitting the requisite data to PHMSA. Accordingly, having reviewed the record and\nconsidered the assessment criteria, I assess Respondent a civil penalty of $28,300 for violation of\n49 C.F.R. § 195.61(b).\nItem 7: The Notice proposed a civil penalty of $31,100 for Respondent’s violation of 49 C.F.R.\n§ 195.420(b) for failing to inspect each mainline valve to determine that it is functioning\nproperly at intervals not exceeding 7 ½ months but at least twice each calendar year. For the\nreasons set forth above, I do not believe a penalty reduction for Dakota Midstream’s ability to\ncontinue in business is warranted.\nIn regard to the remaining civil penalty assessment factors for Item 7, I see no reason to reduce\nthe penalty amount. This was an activities violation that was discovered by PHMSA. Although\npipeline safety was minimally affected, Dakota Midstream failed to comply with an applicable\nrequirement and did not provide a reasonable justification for its noncompliance. Accordingly,\nhaving reviewed the record and considered the assessment criteria, I assess Respondent a civil\npenalty of $31,100 for violation of 49 C.F.R. § 195.420(b).\nItem 8: The Notice proposed a civil penalty of $14,600 for Respondent’s violation of 49 C.F.R.\n§ 195.428(a) for failing to inspect and test each pressure limiting device, relief valve, pressure\nregulator, or other item of pressure control equipment to determine that it is functioning properly,\nis in good mechanical condition, and is adequate from the standpoint of capacity and reliability\nof operation for the service in which it is used at intervals not exceeding 15 months, but at least\nonce each calendar year. For the reasons set forth above, I do not believe a penalty reduction for\nDakota Midstream’s ability to continue in business is warranted.\nIn regard to the remaining civil penalty assessment factors for Item 8, I see no reason to reduce\nthe penalty amount. This was a record-keeping violation that was discovered by PHMSA.\nAlthough pipeline safety was minimally affected, Dakota Midstream failed to comply with an\napplicable requirement. The company received a good faith credit, however, because it provided\na reasonable justification for its noncompliance. Accordingly, having reviewed the record and\nconsidered the assessment criteria, I assess Respondent a civil penalty of $14,600 for violation of\n49 C.F.R. § 195.428(a).\nItem 14: The Notice proposed a civil penalty of $10,300 for Respondent’s violation of 49\nC.F.R. § 195.573(a)(1) for failing to conduct tests on protected pipeline at least once each\ncalendar year, but with intervals not exceeding 15 months, to determine whether cathodic\nprotection required by Subpart H complies with § 195.571. For the reasons set forth above, I\ndo not believe a penalty reduction for Dakota Midstream’s ability to continue in business is\nwarranted.\n\n\n\nIn its Response, Dakota Midstream requested a further reduction because it corrected the\nnoncompliance as soon as weather conditions permitted. This information was already factored\ninto the proposed penalty amount. Violation Report at 73. I see no reason to further reduce the\npenalty. Accordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a civil penalty of $10,300 for violation of 49 C.F.R. § 195.573(a)(1).\nItem 15: The Notice proposed a civil penalty of $40,400 for Respondent’s violation of 49\nC.F.R. § 195.573(e) for failing to correct identified deficiencies in its corrosion control as\nrequired by § 195.401(b). For the reasons set forth above, I do not believe a penalty reduction\nfor Dakota Midstream’s ability to continue in business is warranted.\nIn regard to the remaining civil penalty assessment factors for Item 15, I see no reason to reduce\nthe penalty amount. This was an activities violation that was discovered by PHMSA. The\nviolations occurred not within a high consequence area (HCA), or “could affect” HCA. Dakota\nMidstream failed to comply with an applicable requirement, and did not provide a reasonable\njustification for its noncompliance. Accordingly, having reviewed the record and considered the\nassessment criteria, I assess Respondent a civil penalty of $40,400 for violation of 49 C.F.R.\n§ 195.573(e).\nItem 16: The Notice proposed a civil penalty of $27,600 for Respondent’s viol","truncated":true,"body_characters":63078}