NORTENO PIPELINE COMPANY — Notice of Probable Violation

party submissionOfficial PDF420051003_Petition for Reconsideration_03062006.pdf#

case documentOfficial PDFCPF NO 4-2005-1003 ONEOK INC NORTENO PIPELINE CO .pdf#

case documentOfficial PDFCPF_NO_4-2005-1003.pdf#

420051003_final order_02162006_text.pdf, page 1Official PDFU. S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 400 Seventh Street, S. W Washington, D. C. 20590 FE8 l 6:;„; Mr. John W. Gibson President Oneok, Inc. /Norteno Pipeline Company Oneok Plaza 100 W 5tll St Tulsa, OK 74103 Re: CPF No. 4-2005-1003 Dear Mr. Gibson: Enclosed is the Final Order issued by the Associate Administrato the above-referenced case. It makes findings of violation and assess $27, 500. It further finds that you have completed the actions specifi to comply with the pipeline safety regulations. When the civil penalt enforcement action will be closed. Your receipt of the Final Order c 49 C. F. R. g 190. 5. for Pipeline Safety in s a civil penalty of d in the Notice required is paid, this nstitutes service under Sincerely, James Reynolds Pipeline Compliance Re istry Office of Pipeline Safety Enclosure VIA CERTIFIED MAIL — RETURN RECEIPT RE UESTED#

420051003_final order_02162006_text.pdf, page 2DEPARTMENT OF TRANSPORTATI PIPELINE AND HAZARDOUS MATERIALS SAFETY OFFICE OF PIPELINE SAFETY WASHINGTON, DC 20590 N DMINISTRATION In the Matter of ) Norteno Pipeline Company, ) a wholly-owned subsidiary of Oneok, Inc. , ) Respondent CPF No. 4-2 05-1003 FINAL ORDER On July 8 — 10, 2003, pursuant to 49 U. S. C. $ 60117, a representativ Safety (OPS), Research and Special Programs Administration (RS safety inspection of Respondent's facilities and records pertaining systems in El Paso, Texas. ' As a result of the inspection, the Directo issued to Respondent, by letter dated February 14, 2005, a Noti Proposed Civil Penalty, and Proposed Compliance Order (Notice). In $ 190. 207, the Notice alleged Respondent committed violations of proposed assessing a civil penalty of $30, 000 for the alleged viol proposed ordering Respondent to take certain measures to correct the al of the Office of Pipehne A), conducted a pipeline o the Del Norte pipeline Southwest Region, OPS, e of Probable Violation, ceordanee with 49 C F. R. 49 C. F. R. Part 192 and tions. The Notice also eged violations. After requesting and receiving an extension of time to respond, Res Notice by letter dated March 31, 200S. Respondent contested seve provided information concerning corrective action it had taken. Res hearing, and therefore has waived its right to one. ondent responded to the al of the allegations and ondent did not request a FINDINGS OF VIOLATION Item 1B in the Notice alleged Respondent violated 49 C. F. R. $ 192. 491 (c) by failing to maintain a record of each test, survey, or inspection required by 49 C. F. R. g 192. 81 in sufficient detail to demonstrate the adequacy of atmospheric corrosion control measures. he Notice alleged that at the time of the inspection, Respondent was unable to provide docum ntation that Respondent examined exposed pipe for evidence of atmospheric corrosion i The Norman Y Mineta Research and Special Programs Improvement 118 Stat 2423 (2004), created the Pipehne and Hazardous Matenals Safety Ad transferred the authority of RSPA exercised under chapter 601 of title 49, Admimstrator of PHMSA See also 70 Fed Reg. 8299, 8301-8302 (2005) Act, Pub. L. No 108-426, inistration (PHMSA) and nited States Code, to the#

420051003_final order_02162006_text.pdf, page 3Section 192. 491(c) requires Respondent to maintain a record of ea required by subpart I, including inspections required by $ 192. demonstrate the adequacy of corrosion control measures or that a exist. Section 192. 481(a) requires Respondent to inspect each on pipeline that is exposed to the atmosphere for evidence of atmosp every 3 calendar years, with intervals not exceeding 39 months. stated that the Del Norte pipeline system does not have portions of the atmosphere. Respondent also submitted a sample of a pipeline s specific location on the pipeline system (Canutillo WGI) to show th t Del Norte pipeline system since 2001 included inspections for atmos test, survey, or inspection 81, in sufficient detail to orrosive condition does not hore pipeline or portion of eric corrosion at least once n its response, Respondent ipeline that are exposed to fety inspection report for a annual inspections for the heric corrosion. Although Respondent contended that the pipeline system does not pipeline, Respondent submitted a letter to OPS dated August 20, 20 exposed portions of pipeline, such as above-ground regulator stati $$ 192. 481(a) and 192. 491(c), Respondent must inspect each expo every 3 years ior evidence of atmospheric corrosion and maintain a for at least 5 years. The documentation submitted by Respondent sho checked the paint conditions at the Canutillo WGI location betw documentation does not demonstrate compliance with respect to th system at the time of the OPS inspection. Accordingly, I find $$ 192. 491(c) and 192. 481 as alleged in the Notice. have portions of exposed 3 that includes pictures of 4 ns. Accordingly, under ed locations at least once ecord of those inspections s only that it had visually en 2001 and 2005. The entire Del Norte pipeline that Respondent violated Item 2B in the Notice alleged Respondent violated 49 C. F. R. $ 1 documentation to show that a class location study had been perfor population density indicated a change in class location. The Notice 81 inspection, Respondent was unable to provide documentation to s performed a class location study to determine, among other things, th the Del Norte pipeline system. The Notice noted that Respondent's 2 six miles of pipeline in Class 2; but the OPS inspector observed that t six miles of Class 3 and only one mile of either Class 1 or Class 2. 2. 609 by failing to have ed when an increase in ged that at the time of the ow that Respondent had present class location of 02 annual report showed e system was more likely Section 192. 609 requires Respondent to perform a class location stud whenever an increase in population density indicates a change in class location for a segment f the pipeline system. In its response, Respondent submitted documentation that the Del orte pipeline system is approximately five miles of Class 3, approximately one-half mile of C ass 2, and approximately one mile of Class 1. The documentation is dated March 1, 2005, and therefore, does not demonstrate coinpliance at the time of the OPS inspection on July 8— 0, 2003. Accordingly, I find that Respondent violated $ 192. 609 as alleged in the Notice. Item 2C in the Notice alleged Respondent violated 49 C. F. R. $ 19 documentation to show that liaison had been established with appropri public officials. The Notice alleged that at the time of the inspection, of contact with appropriate officials in New Mexico . 615 by failing to have te fire, police, and other espondent had no record Response, p 2 Response Attachment, Tab 1 OPS Gas Pipehne Safety Violation Report, Exhibit 1#

420051003_final order_02162006_text.pdf, page 4Section 192. 615 requires Respondent to establish and maintain h i son with appropriate fire, police, and other public officials to: learn the responsibility and res urces of each government organization that may respond to a gas pipeline emergency; acq aint the officials with the operator's ability in responding to a gas pipeline emergency; identi the types of gas pipeline emergencies of which the operator notifies the officials; and plan ho the operator and officials can engage in mutual assistance to minimize hazards to life or propert . In its response, Respondent submitted documentation of training a conducted with local Texas and New Mexico public safety officials took place on June 17, 2004, approximately one year after the OPS i not demonstrated that it established liaison prior to the OPS inspect find that Respondent violated $ 192. 615 as alleged in the Notice. Item 2D in the Notice alleged Respondent violated 49 C. F. R. $ 1 documentation to show that the pipeline system had been patrolled in The Notice alleged that at the time of the inspection, Respondent di patrolling history for the Del Norte ¹1 pipeline. Section 192. 709 requires Respondent to maintain a record of each patr test required by subparts L and M, including patrols required under $ 1 or until the next patrol, survey, inspection, or test is completed, whi 192. 705 requires Respondent to perform patrols to observe surface co the transmission line right-of-way for indications of leaks, construction affecting safety and operation. Patrols are to be performed at least pursuant to g 192. 705(b). In its response, Respondent submitted patrol records for the Del N through 2004. Respondent stated that these documents existed at the were maintained within other company records. Respondent explai patrol records separate from other company records in the future. documentation demonstrates that the Del Norte ¹1 pipeline was pat 2004, Respondent did not submitted records of patrols prior to 20 ) 192. 709, Respondent must be able to produce records of patrols for the OPS inspection (July 1998). Accordingly, I find that Respondent 192. 705 by failing to maintain for at least 5 years a record of each pa Norte ¹1 pipehne in 1998 through 2001. ASSESSMENT OF PENALTY d liaison that Respondent The training and liaison spection. Respondent has on on July 8 — 10, 2003. I 2. 709 by failing to have ccordance with g 192. 705. not have a record of the 1, survey, inspection, and 2. 705, for at least 5 years hever is longer. Section ditions on and adjacent to activity, and other factors ually, if not more often rte ¹1 pipeline for 2002 me of the inspection, but ed that it will maintain Although Respondent*s oiled in 2002, 2003 and 2. In accordance with t least five years prior to violated $g 192. 709 and ol conducted on the Del Under 49 U. S. C. $ 60122, Respondent is subject to a civil penalty no violation for each day of the violation up to a maximum of $1, 000, 000 violations. The Notice proposed a total civil penalty of $30, 000 for the to exceed $100, 000 per for any related series of iolations. 49 U. S. C. $ 60122 and 49 C. F. R. $ 190. 225 require that, in determinin penalty, I consider the following criteria: nature, circumstances, and the amount of the civil avity of the violation,#

420051003_final order_02162006_text.pdf, page 5degree of Respondent's culpability, history of Respondent's prior o to pay the penalty, good faith by Respondent in attempting to achie Respondent's ability to continue in business, and such other matters fenses, Respondent's abihty e compliance, the effect on s justice may require. Item 1B in the Notice proposed a civil penalty of $5, 000 for violat ng 49 C. F. R. g$ 192. 491(c) and 192. 481. Failure to inspect exposed pipelines for evidence of atmospheric corrosion may lead to corrosive conditions on the pipeline and pipeline failure. Keeping adequate records allows Respondent to review historical conditions on the pipeli e and past practices and procedures. Respondent has not submitted information that would warrant a reduction in the civil penalty amount proposed in the Notice for this violation. Accor ingly, having reviewed the record and considered the assessment criteria, I assess Respondent civil penalty of $5, 000 for the violation of $$ 192 491(c) and 192 481. Item 2B in the Notice proposed a civil penalty of $10, 000 for viol Class 3 and Class 4 areas are more densely populated and includ mu!tistoried buildings, places of public assembly and playgrounds many pipeline safety regulations are more stringent in those areas. location study when an increase in population density indicates jeopardizes public safety. Subsequent to the OPS inspection, Respo with respect to this violation. That action alone, however, does no penalty for the violation because Respondent is under an affirmative d Accordingly, having reviewed the record and considered the ass Respondent a civil penalty of $10, 000 for the violation. ting 49 C. F. R. $ 192. 609 places where residences, ay be prevalent. As such, Failure to perform a class change in class location dent achieved compliance justify reducing the civil ty to achieve compliance. ssment criteria, I assess Item 2C in the Notice proposed a civil penalty of $5, 000 for viola Subsequent to the OPS inspection, Respondent achieved compli violation. That action alone, however, does not justify reducing the ci because Respondent is under an affirmative duty to achieve complia submitted information that would warrant a reduction in the civil penal Notice for this violation. Accordingly, having reviewed the re assessment criteria, I assess Respondent a civil penalty of $5, 000 for th ing 49 C. F. R. $ 192. 615. ce with respect to this il penalty for the violation ce. Respondent has not y amount proposed in the ord and considered the violation. Item 2D in the Notice proposed a civil penalty of $10, 000 for violati and 192. 705 by failing to maintain for at least 5 years a record of eac Del Norte ¹I pipeline. Failure to perform right-of-way patrols on a re hazardous or potentially unsafe condition going undetected, such construction activity in the vicinity of the pipeline. In its response, Re records for the Del Norte ¹1 pipeline for the time period from 2002 Respondent could not demonstrate full compliance with $$ 192. 709 a ability to demonstrate compliance with several years in question reduction to the civil penalty. Accordingly, having reviewed the re assessment criteria, I assess Respondent a reduced civil penalty of $7, 50 g 49 C. F. R. $$ 192. 709 patrol conducted on the ular basis may result in a as a pipeline leak or pondent submitted patrol rough 2004. Although d 192. 705, Respondent's justifies a proportional ord and considered the for the violation. Having reviewed the record and considered the assessment criteria, I civil penalty of $27, 500. I find Respondent has the ability to pay this affecting its ability to continue in business. sess Respondent a total enalty without adversely#

420051003_final order_02162006_text.pdf, page 6Payment of the civil penalty must be made within 20 days of serv ce. Federal regulations (49 C. F. R. $ 89. 21(b)(3)) require this payment be made by wire tr sfer, through the Federal Reserve Communications System (Fedwire), to the account of t e U. S. Treasury. Detailed instructions are contained in the enclosure. Questions concerni g wire transfers should be directed to: Financial Operations Division (AMZ-120), Federal Av ation Administration, Mike Monroney Aeronautical Center, P. O. Box 25082, Oklahoma City, 0 73125; (405) 954-4719. Failure to pay the $27, 500 civil penalty will result in accrual of inter st at the current annual rate in accordance with 31 U. S. C. $ 3717, 31 C. F. R. $ 901. 9 and 49 C. F. R. $ 89. 23. Pursuant to those same authorities, a late penalty charge of six percent (6%) pe annum will be charged if payment is not made within 110 days of service. Furthermore, fail re to pay the civil penalty may result in referral of the matter to the Attorney General for app opriate action in a United States District Court. COMPI IAiYCK GRDKR The Notice proposed a compliance order with respect to Items 2B, 2C ) 60118(a), each person who engages in the transportation of gas o and 2D. Under 49 U. S. C. pipeline facility is required to comply with the applicable safety st who owns or operates a Chapter 601. The Director, Southwest Region, OPS, has reviewed the dards established under Respondent and has indicated that the corrective action has achieved corrective action taken by those violations. Accordingly, since compliance has been achieved, it ompliance with respect to the compliance terms in this order. s not necessary to include WARNING ITEMS The Notice did not propose a civil penalty or corrective action for Ite exposed pipe, and Item 2A, failing to keep records of abnormal operati considered warning items. Respondent is warned that if it does not t correct these items, enforcement action will be taken if a subsequ violation. 1A, faihng to examine ns. Therefore, these are e appropriate action to nt inspection reveals a Under 49 C. F. R. g 190. 215, Respondent has a right to submit a Petiti this Final Order. The petition must be received within 20 days of Res n for Reconsideration of Final Order and must contain a brief statement of the issue(s). T ondent's receipt of this automatically stays the payment of any civil penalty assessed. Howev e filing of the petition r if Respondent submits payment for the civil penalty, the Final Order becomes the final admi istrative action and the right to petition for reconsideration is waived. The terms and conditio effe ' of this Final Order are e on receipt. St ce Ass Ger ard ate Administrator for Pipeline Safety FEH 16 i", '" Date Issued#

420051003_decision on petition for reconsideration_06212006_text.pdf, page 1Official PDFU. S. Department of Transportation Plpellne and Haxardous Materials Safety Admlnhtratlon JUN 21 i00o Mr. John W. Gibsorr President Oneolc, Inc. /Norteno Pipeline Company Oneok Plaza 100 W 5 Street Tulsa, OK 74103 Re: CPF No. 4-2005-1003 Dear Mr. Gibson: Enclosed is a decision on the petition for reconsideration filed in case. The Associate Administrator for Pipeline Safety has denied the the payment of the remaining $27, 500 civil penalty is due immediatel advised that appropriate corrective action regarding the Warning Item Order must also be taken if such action has not already been complet decision constitutes service under 49 C. F. R. $ 190. 5. Sincerely, James Reynolds Pipeline Compliance Regis Office of Pipeline Safety Enclosure Cc: Sue Griffin, Assoc. General Counsel and Asst. Corporate Secre CERTIFIED MAIL — RETURN RECEIPT RK UESTED 400 Seventh Street, S. N. Washtngton, O. C. 20590 above-referenced tition. Accordingly, . In addition, please be specified in the Final . Your receipt of this#

420051003_decision on petition for reconsideration_06212006_text.pdf, page 2DEPARTMENT OF TRANSPORTATIO PIPELINE AND HAZARDOUS MATERIALS SAFETY A OFFICE OF PIPELINE SAFETY WASHINGTON, DC 20590 INISTRATION ) In the Matter of ) ) Norteno Pipeline Company, ) a wholly-owned subsidiary of Oneok, Inc. ) ) Petitioner. ) CPF N J 4-2005-1003 DECISION ON PETITION FOR RECONSIDE ION On February 16, 2006, pursuant to 49 U. S. C. $ 60112, the Associat Pipeline Safety (Associate Administrator) issued a Final Order in th Petitioner had violated the pipeline safety regulations and assessing amount of $27, 500. The Final Order warned Petitioner to take appr action regarding some of Petitioner's practices for examining expos data administrator for j case finding civil penalty in the riate corrective pipe and recording On March 6, 2006, Petitioner filed a petition for reconsideration of petition, Petitioner sought reconsideration of one finding of violatio identified as "Item 1B" for the failure to maintain a record of each te inspection required by 49 C. F. R. f 192. 481 in sufficient detail to de adequacy of atmospheric corrosion control measures. e Final Order. In its in the Final Order, t, survey, or onstrate the Petitioner argues: "Norteno has no exposed 'pipeline or portion of meters/regulators which are annually inspected for atmospheric corr response to Item 1B, Petitioner submitted copies of its "Meter/Regul Safety Inspection Reports" for five meter/regulator stations for the t 1998 to 2005. Petitioner states there are only five meter/regulator s pipeline system, and therefore, those records are the only records req demonstrate the adequacy of its atmospheric corrosion control meas peline', only sion. " In tor Station e period from tions in the ired to es. Section 192. 481 requires each operator to inspect "each pipeline or P rtion of pipeline that is exposed to the atmosphere for evidence of atmosphe "c corrosion. " A pipeline is "all parts of those physical facilities through which gas oves in transportation, including pipe, valves, and other appurtenance attache to pipe, compressor units, metering stations, regulator stations, delivery statio s, holders,#

420051003_decision on petition for reconsideration_06212006_text.pdf, page 3and fabricated assemblies. "' Any pipeline that is above ground is " atmosphere. " All above-ground pipe must be inspected, including intentionally above ground — not only pipe that has become expose causes. Therefore, Petitioner is required to inspect for atmospheric parts of those physical facilities through which gas moves in transp above ground. posed to the i ethatis ough natural rrosion on all iItation and are Section 192. 491 requires each operator to maintain records of the in performed under section 192. 481. Petitioner states it has only five stations and submitted records demonstrating inspection for atmosp of those five regulators/meters. Petitioner indicates that those recor records required to show it performed the inspections required unde 192. 481. actions pter/regulator prie corrosion are the only ection Petitioner's statement that it has no exposed "'pipeline or portion of meters/regulators" is incorrect. Petitioner's pipeline clearly has mor locations where pipe is above ground. Petitioner's "System Protecti Exposed Mains Patrol Checklist" identifies seventeen pages of locat is exposed. Although some document indicates the pipe condition a locations, it does not indicate the condition at others. Petitioner also photos of above ground pipe at locations other than the five regulato 'ipeline', only tliail five p Department $ns where pipe Income ubmitted meter sites. Section 192. 481 requires Petitioner to inspect all of the locations wi for atmospheric corrosion, not just the regulator/meter sites. Petition records of atmospheric corrosion inspections of five regulators/meter exposed pipeline subject to section 192. 481. Petitioner did not prod records for atmospheric corrosion inspections of all pipeline located Of particular note, none of the documents produced by Petitioner rec of the Del Norte ¹1 line. exposed pipe r produced which are , e complete bove ground. rd inspections I The records Petitioner submitted do not demonstrate that it maintaine complete records of its atmospheric corrosion inspections at all locations wher it has exposed pipeline. Relief Denied I have considered Petitioner's request for reconsideration and the add it submitted with its request. Petitioner has failed to demonstrate that complete records of atmospheric corrosion inspections in sufficient d demonstrate the adequacy of atmospheric corrosion control measures all terms of the Final Order remain in effect, including assessment of penalty in the amount of $27, 500. tional records it maintained tail to„ Therefore, e civil Payment of the civil penalty must be made within 20 da s of service. Federal regulations (49 C. F. R. g 89, 21 fb)(3N require this payment be made b wire trans fer. ' 49 C F, R. g 192. 3.#

420051003_decision on petition for reconsideration_06212006_text.pdf, page 4through the Federal Reserve Communications System (Fedwire), to e account of the U. S. Treasury. Questions concerning wire transfers should be d'r cted to: Financial Operations Division (AMZ-120), Federal Aviation Admin' tration, Mike Monroney Aeronautical Center, P. O. Box 25082, Oklahoma City, 0 73125; (405) 954-4719. Failure to pay the civil penalty will result in accrual of interest at the current annual rate in accordance with 31 U. S. C. g 3717, 31 C. F. R. g 901. 9 and 49 . F. R. $ 89. 23. Pursuant to those same authorities, a late penalty charge of six perce (6%) per annum will be charged if payment is not made within 110 days of se ice. Failure to pay the civil penalty may result in referral of the matter to the Att gey General for appropriate action in a United States District Court. This decision on reconsideration is the final administrative action in is proceeding. I I jJUN 21 204) ate Issued e y Gerard s c iate Administrator r Pipeline Safety#