{"operation":"document","citation":"CPF 420119001","title":"CHEVRON U.S.A. INC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2011-08-09","effective_on":null,"summary":"CLOSED notice of probable violation citing 192.10, 192.13(a), 192.317, 192.465(b), 192.805, 195.404(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-420119001.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-420119001.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-420119001","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/420119001","body":"Notice of Probable Violation involving CHEVRON U.S.A. INC. PHMSA's enforcement data identifies the cited regulations as 192.10,  192.13(a),  192.317,  192.465(b),  192.805,  195.404(a). The case was opened on 2011-08-09 and is reported as closed as of 2014-04-09. Proposed civil penalty: $93,600. Assessed civil penalty: $93,600. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n420119001_Closure_04092014.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420119001/420119001_Closure_04092014.pdf\n\n420119001_Closure_04092014_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420119001/420119001_Closure_04092014_text.pdf\n\n420119001_Final Order_06142012.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420119001/420119001_Final%20Order_06142012.pdf\n\n420119001_Final Order_06142012_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420119001/420119001_Final%20Order_06142012_text.pdf\n\n420119001_NOPV PCP PCO_08092011.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420119001/420119001_NOPV%20PCP%20PCO_08092011.pdf\n\n420119001_NOPV PCP PCO_08092011_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420119001/420119001_NOPV%20PCP%20PCO_08092011_text.pdf\n\n420119001_Operator Response Notice_09062011.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420119001/420119001_Operator%20Response%20Notice_09062011.pdf\n\n420119001_Closure_04092014_text.pdf\n\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nApril 9, 2014\nMr. Warner Williams\nVice President GOM\nChevron USA Inc.\n100 Northpark Blvd\nCovington, LA 70433\nCPF 4-2011-9001\nDear Mr. Williams:\nOn June 14, 2012, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued a Final\nOrder in the above referenced case. The Final Order made findings of violation, assessed a civil penalty, and\nincluded a Compliance Order that specified actions to be taken by Chevron, USA Inc. to comply with the\npipeline safety regulations. Among other things, the required actions included the development and\nimplementation of written conversion-to-service plans for two specified offshore pipelines in the Bay and\nField in accordance with the applicable provisions of 49 C.F.R. Parts 192 and 195.\nAfter requesting and receiving an extension of time, by letter dated December 19, 2012, Chevron submitted a\nconversion-to-service plan for one of the pipelines, a 6-inch diameter oil pipeline segment designated as ST-\n0164. With respect to the other line, a 6-inch diameter gas pipeline designated as SN-375, Chevron informed\nPHMSA that the line was out of service and undergoing an evaluation of its future utility, and that Chevron\nwas requesting a further extension of time to submit the required conversion-of-service plan for this line. By\nletter dated December 19, 2012, PHMSA granted the requested extension until March 31, 2013.\nBy letter dated March 25, 2013, Chevron informed PHMSA that it was proceeding with the permitting of a\nnew pipeline to replace line SN-375 and requested closure of the Compliance Order. PHMSA understands\nthis to mean that Chevron has completed the process of permanently decommissioning line SN-375 in\naccordance with 49 C.F.R. §192.727 and Chevron’s decommissioning/abandonment procedures. On that\nbasis, Chevron may consider the Compliance Order to be closed. If, however, the decommissioning is not\npermanent and any future operation of line SN-375 is contemplated, Chevron or its successors will remain\nresponsible for satisfying the conversion-to-service requirements prior to such operation.\nThank you for your cooperation in this matter.\nSincerely,\nR. M. Seeley\nDirector, Southwest Region\nPipeline and Hazardous Materials Safety Administration\n\n420119001_Final Order_06142012_text.pdf\n\nJUNE 14, 2012\nMr. Gary Luquette\nPresident\nChevron USA Inc.\n1500 Louisiana Street\nHouston, TX 77002\nRe: CPF No. 4-2011-9001\nDear Mr. Luquette:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation, assesses a civil penalty of $93,600, and specifies actions that need to be taken by\nChevron USA Inc., to comply with the pipeline safety regulations. The penalty payment terms\nare 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, Southwest Region, this\nenforcement action will be closed. Service of the Final Order by certified mail is deemed\neffective upon the date of mailing, or as otherwise provided under 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nJeffrey D. Wiese\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Mr. Warner Williams, Vice-President, Gulf of Mexico, Chevron USA Inc.\n100 Northpark Boulevard, Covington, LA 70433\nMr. Alan Mayberry, Deputy Associate Administrator for Field Operations, OPS\nMr. Rod M. Seeley, Director, Southwest Region, OPS\nCERTIFIED MAIL - RETURN 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 )\nChevron USA Inc., ) CPF No. 4-2011-9001\n)\n)\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nBetween March 2010 and December 2010, pursuant to 49 U.S.C. § 60117, a representative of the\nPipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety\n(OPS), inspected Chevron USA Inc.’s (Chevron or Respondent) records and facilities in\nCovington, Lafayette, Cameron, and LaFourche Parishes, Louisiana. OPS also inspected the\ncompany’s Gulf of Mexico offshore facilities in West Cameron, Bay Marchand, and Grand Isle.\nChevron operates 35 miles of jurisdictional natural gas and crude oil pipelines from its offshore\nproduction facilities.\n1\nAs a result of these inspections, the Director, Southwest Region, OPS (Director), issued to\nRespondent, by letter dated August 9, 2011, a Notice of Probable Violation, Proposed Civil\nPenalty, and Proposed Compliance Order (Notice), which also included a warning pursuant to\n49 C.F.R. § 190.205. In accordance with 49 C.F.R. § 190.207, the Notice proposed finding that\nChevron had committed various violations of 49 C.F.R. Part 192 and 195 and assessing a civil\npenalty of $93,600 for the alleged violations. The warning items required no further action but\nwarned the operator to correct the probable violations or face future potential enforcement\naction.\nUpon requesting and receiving an extension of time to respond, Chevron responded to the Notice\nby letter dated September 6, 2011 (Response). The company did not contest the probable\nviolations but requested a modification of the proposed compliance order. Respondent did not\nrequest a hearing and therefore has waived its right to one.\nFINDINGS OF VIOLATION\nIn its Response, Chevron did not contest the allegation in the Notice that it violated\n49 C.F.R. § Parts 192 and 195, as follows:\n1 OPS Pipeline Safety Violation Report (August 8, 2011), at 1.\n\n\n\n2\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. §§ 192.10 and 195.9, which state,\nin relevant part:\n§ 192.10 Outer continental shelf pipelines.\nOperators of transportation pipelines on the Outer Continental Shelf\n(as defined in the Outer Continental Shelf Lands Act; 43 U.S.C. 1331)\nmust identify on all their respective pipelines the specific points at which\noperating responsibility transfers to a producing operator….\n§ 195.9 Outer continental shelf pipelines.\nOperators of transportation pipelines on the Outer Continental Shelf\nmust identify on all their respective pipelines the specific points at which\noperating responsibility transfers to a producing operator. For those\ninstances in which the transfer points are not identifiable by a durable\nmarking, each operator will have until September 15, 1998 to identify the\ntransfer points. If it is not practicable to durably mark a transfer point and\nthe transfer point is located above water, the operator must depict the\ntransfer point on a schematic maintained near the transfer point. If a\ntransfer point is located subsea, the operator must identify the transfer\npoint on a schematic which must be maintained at the nearest upstream\nfacility and provided to PHMSA upon request. For those cases in which\nadjoining operators have not agreed on a transfer point by September 15,\n1998 the Regional Director and the MMS Regional Supervisor will make\na joint determination of the transfer point.\nThe Notice alleged that Respondent violated 49 C.F.R. §§ 192.10 and 195.9 by failing to identify\nthe demarcation point between production and transportation pipeline facilities in certain areas.\nSpecifically, Chevron did not identify where piping changed from production to transportation\nfor the Grand Isle Block Number 27 platform R, the Bay Marchand Block Number 2 platform\nC&I, and the Bay Marchand Block Number 3 platform K&N. The demarcation points for these\nfacilities could neither be visibly located nor could Chevron provide the required schematic\ndrawings depicting the transfer points.\nIn its Response, Chevron stated that its Piping and Instrumentation Diagrams (P&IDs) were\navailable for review during the OPS inspection but did not contest the allegation of violation.\nChevron stated that it had nevertheless re-marked the demarcation points, provided pictures of\nthe new markings in its Response, and submitted the P&IDs for PHMSA’s review. On account\nof the evidence provided in the Response, Chevron requested that PHMSA remove Item #1 from\nthe proposed compliance order.\nI find that Chevron was not in compliance with the pipeline safety regulations at the time of the\ninspection since the demarcation points were not visible and the OPS inspector was not given a\ncopy of the relevant schematic drawings. Therefore, based upon a review of all of the evidence,\nI find that Respondent violated 49 C.F.R. §§ 192.10 and 195.9 by failing to identify the transfer\npoint from production to transportation on the listed facilities. The terms of the Compliance\nOrder will be addressed in that section of the Final Order below.\n\n\n\n3\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. §§ 192.13 and 195.5, which state,\nin relevant part:\n§ 192.13 What general requirements apply to pipelines regulated\nunder this part?\n(a) No person may operate a segment of pipeline listed in the first\ncolumn that is readied for service after the date in the second column,\nunless:\n(1) The pipeline has been designed, installed, constructed, initially\ninspected, and initially tested in accordance with this part; or\n(2) The pipeline qualifies for use under this part according to the\nrequirements in § 192.14. . . .\n§ 195.5 Conversion to service subject to this part.\n(a) A steel pipeline previously used in service not subject to this part\nqualifies for use under this part if the operator prepares and follows a\nwritten procedure to accomplish the following:\n(1) The design, construction, operation, and maintenance history of\nthe pipeline must be reviewed and, where sufficient historical records are\nnot available, appropriate tests must be performed to determine if the\npipeline is in satisfactory condition for safe operation. If one or more of\nthe variables are necessary to verify the design pressure under § 195.106\nor to perform the testing under paragraph (a)(4) of this section is\nunknown, the design pressure may be verified and the maximum operating\npressure determined by-\n(i) Testing the pipeline in accordance with ASME B31.8, Appendix\nN, to produce a stress equal to the yield strength; and\n(ii) Applying, to not more than 80 percent of the first pressure that\nproduces a yielding, the design factor F in § 195.106(a) and the\nappropriate factors in § 195.106(e).\n(2) The pipeline right-of-way, all aboveground segments of the\npipeline, and appropriately selected underground segments must be\nvisually inspected for physical defects and operating conditions which\nreasonably could be expected to impair the strength or tightness of the\npipeline.\n(3) All known unsafe defects and conditions must be corrected in\naccordance with this part.\n(4) The pipeline must be tested in accordance with subpart E of this\npart to substantiate the maximum operating pressure permitted by\n§ 195.406.\n(b) A pipeline that qualifies for use under this section need not\ncomply with the corrosion control requirements of subpart H of this part\nuntil 12 months after it is placed into service, notwithstanding any\nprevious deadlines for compliance.\n(c) Each operator must keep for the life of the pipeline a record of the\ninvestigations, tests, repairs, replacements, and alterations made under the\nrequirements of paragraph (a) of this section.\n\n\n\n4\nThe Notice alleged that Respondent violated 49 C.F.R. §§ 192.13 and 195.5 by failing to prepare\nand follow written conversion-to-service procedures and to maintain records demonstrating that\nthe applicable conversion-to-service requirements were implemented for certain pipelines now\noperated as ones regulated by U.S. Department of Transportation (DOT). It further alleged that\nChevron’s own procedures required that a written plan and records regarding the conversion to\nservice be developed and maintained. Specifically, there were no records available of a\nconversion-to-service plan for the six-inch gas line between Grand Isle 37R and Bay Marchand\nBlock Number 3 C&I. Chevron began using this line on December 19, 2008, and it was still in\nservice at the time of the OPS inspection when Chevron was unable to produce the records.\nIn regards to the six-inch oil line running from Bay Marchand Block Number 3 platform E to\nBay Marchand Block Number 3 platform C&I, Chevron also could not produce any conversion-\nto-service procedures or records for this line. Chevron began using the line on July 3, 2010, yet\ncould not produce any conversion-to-service records for the line at the time of the OPS\ninspection.\nIn its Response, Chevron did not contest the allegation of violation and agreed to pay the civil\npenalty and comply with the proposed compliance order. Accordingly, based upon a review of\nall of the evidence, I find that Respondent violated 49 C.F.R. §§ 192.13 and 195.5 by failing to\nprepare and follow written conversion-to-service procedures and to maintain proper records\ndemonstrating that the applicable conversion-to-service requirements were implemented for\nthese lines.\nItem 4: The Notice alleged that Respondent violated 49 C.F.R. §§ 192.805 and 195.505, which\nstate, in relevant part:\n§ 192.805 Qualification program.\nEach operator shall have and follow a written qualification program.\nThe program shall include provisions to:\n(a) Identify covered tasks;\n(b) Ensure through evaluation that individuals performing covered\ntasks are qualified;\n(c) Allow individuals that are not qualified pursuant to this subpart to\nperform a covered task if directed and observed by an individual that is\nqualified; ….\n§ 195.505 Qualification program.\nEach operator shall have and follow a written qualification program.\nThe program shall include provisions to:\n(a) Identify covered tasks;\n(b) Ensure through evaluation that individuals performing covered\ntasks are qualified;\n(c) Allow individuals that are not qualified pursuant to this subpart to\nperform a covered task if directed and observed by an individual that is\nqualified; ….\n\n\n\n5\nThe Notice alleged that Respondent violated 49 C.F.R. §§ 192.805 and 192.505 by failing to\nensure, under its operator qualification (OQ) program, that a certain covered task was performed\nby a qualified individual. Specifically, the Notice alleged that according to Chevron’s\nprocedures, inspection of the Sabine Gas Plant rectifier was a covered task and therefore all\ninspections of the rectifier had to be conducted by a qualified individual. It alleged, however,\nthat a qualified individual only inspected the Sabine Gas Plant rectifier once between April 1,\n2008, and February 20, 2010. Non-qualified individuals carried out the other inspections\nconducted during this period.\nIn its Response, Chevron did not contest the allegation of violation and agreed to pay the civil\npenalty and comply with the proposed compliance order. Chevron also stated that it had taken\nsteps to avoid noncompliance in the future. Accordingly, based upon a review of all of the\nevidence, I find that Respondent violated 49 C.F.R. §§ 192.805 and 195.505 by failing to ensure\nthat the covered task of rectifier inspections was performed by a qualified individual.\nItem 6: The Notice alleged that Respondent violated 49 C.F.R. §§ 192.465 and 195.573, which\nstate, in relevant part:\n§ 192.465 External corrosion control: Monitoring.\n(a) . . .\n(b) Each cathodic protection rectifier or other impressed current\npower source must be inspected six times each calendar year, but\nwith intervals not exceeding 2½ months, to insure that it is\noperating.\n§ 195.573 What must I do to monitor external corrosion control?\n(a) . . .\n(c) Rectifiers and other devices. You must electrically check for\nproper performance each device in the first column at the frequency\nstated in the second column.\nDevice Check frequency\nRectifier …………………\nReverse current switch.\nDiode.\nInterference bond whose failure\nWould jeopardize structural\nprotection….\nAt least six times each calendar\nyear, but with intervals not\nexceeding 2½ months.\nThe Notice alleged that Respondent violated 49 C.F.R. §§ 192.465 and 192.573 by failing to\ninspect certain rectifiers for proper performance within the required interval. The Sabine Gas\nPlant rectifier supplies cathodic protection current for both the six-inch oil line and the 18-inch\ngas line. This device is required by both Parts 192 and 195 to be inspected six times per year, at\nintervals not exceeding 2½ months. The Notice alleged that although Chevron had supplied\ndocumentation indicating that readings on the voltmeter and ammeter dials were taken, there was\n\n\n\n6\nno indication that the meters had ever been checked for accuracy. In addition, no documentation\nwas provided for the time period from August 29, 2008, to February 14, 2009.\nIn its Response, Chevron did not contest the allegation of violation and agreed to pay the civil\npenalty. Chevron also stated that it had discovered this non-compliance and taken steps to\naddress it prior to the inspection. This proactive conduct and the evidence supporting it will be\nreviewed in the Assessment of Penalty section below.\nAccordingly, based upon a review of all of the evidence, I find that Respondent violated\n49 C.F.R. §§ 192.465 and 195.573 by failing to perform proper rectifier inspections within the\nrequired interval.\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$100,000 per violation for each day of the violation, up to a maximum of $1,000,000 for any\nrelated series of violations. In determining the amount of a civil penalty under\n49 U.S.C. § 60122 and 49 C.F.R. § 190.225, I must consider the following criteria: the nature,\ncircumstances, and gravity of the violation, including adverse impact on the environment; the\ndegree of Respondent’s culpability; the history of Respondent’s prior offenses; the Respondent’s\nability to pay the penalty and any effect that the penalty may have on its ability to continue doing\nbusiness; and the good faith of Respondent in attempting to comply with the pipeline safety\nregulations. In addition, I may consider the economic benefit gained from the violation without\nany reduction because of subsequent damages, and such other matters as justice may require.\nThe Notice proposed a total civil penalty of $93,600 for the violations cited above.\nItem 2: The Notice proposed a civil penalty of $27,200 for failing to follow written conversion-\nto-service procedures and to maintain records demonstrating that the applicable conversion-to-\nservice requirements were implemented for certain pipelines now operated as DOT pipelines. In\nits Response, Chevron agreed to pay the proposed civil penalty.\nThe civil penalty amount for this Item is based on the civil penalty assessment factors listed in\n49 C.F.R. § 190.225, including, but not limited to, culpability, gravity, duration of the violation,\nand prior enforcement history of the operator. As stated in the Violation Report, the non-\ncompliance posed a significant threat to pipeline safety, even though no accident occurred.\nChevron has not presented any evidence or arguments that would justify a reduction in the\nproposed penalty amount. Having reviewed the penalty factors and the facts of this case, I find\nthat the proposed civil penalty of $27,200 is justified. Accordingly, I assess Respondent a civil\npenalty of $27,200.\nItem 4: The Notice proposed a civil penalty of $33,200 for failing to ensure that a certain\ncovered task was performed by a qualified individual. In its Response, Chevron agreed to pay\nthe proposed civil penalty.\n\n\n\n7\nThe civil penalty amount for this Item is based on the civil penalty assessment factors listed in\n49 C.F.R. § 190.225, including but not limited to, culpability, gravity, duration of the violation,\nand prior enforcement history of the operator. As stated in the Violation Report, the non-\ncompliance posed a significant threat to pipeline safety, even though no accident occurred.\nChevron has not presented any evidence or arguments that would justify a reduction in the\nproposed penalty amount. Having reviewed the penalty factors and the facts of this case, I find\nthat the proposed civil penalty of $33,200 is justified. Accordingly, I assess Respondent a civil\npenalty of $33,200.\nItem 6: The Notice proposed a civil penalty of $33,200 for failing to fully perform certain\nrequired rectifier inspections within the required interval. In its Response, Chevron agreed to\npay the civil penalty amount but noted that it had discovered the non-compliance and taken\nnecessary steps to correct the violation before the OPS inspection.\nThe civil penalty amount for this Item is based on the civil penalty assessment factors listed in\n49 C.F.R. § 190.225, including but not limited to, culpability, gravity, duration of the violation,\nand prior enforcement history of the operator. I would note that the proposed penalty for this\nItem was already reduced in light of the fact that Chevron discovered the violation prior to the\nOPS inspection and took action to address the problem. Accordingly, having reviewed the\npenalty factors and the facts of this case, I find that the proposed civil penalty of $33,200 is\njustified. Accordingly, I assess Respondent a civil penalty of $33,200.\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 $93,600.\nPayment of the civil penalty must be made within 20 days of service. Federal regulations\n(49 C.F.R. § 89.21(b)(3)) require such payment to be made by wire transfer through the Federal\nReserve Communications System (Fedwire), to the account of the U.S. Treasury. Detailed\ninstructions are contained in the enclosure. Questions concerning wire transfers should be\ndirected to: Financial Operations Division (AMZ-341), Federal Aviation Administration, Mike\nMonroney Aeronautical Center, P.O. Box 269039, Oklahoma City, Oklahoma 73125. The\nFinancial Operations Division telephone number is (405) 954-8893.\nFailure to pay the $93,600 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, and 4 in the Notice for\nviolations of 49 C.F.R. §§ 192.10, 195.9, 192.13, 195.5, 192.805, and 195.505, respectively.\nUnder 49 U.S.C. § 60118(a), each person who engages in the transportation of gas or hazardous\nliquids or who owns or operates a pipeline facility is required to comply with the applicable\n\n\n\n8\nsafety standards established under chapter 601. The Director indicates that Respondent has taken\nthe following actions specified in the proposed compliance order:\nWith respect to the violations of § 49 C.F.R. §§ 192.10 and 195.9 (Item 1),\nRespondent has provided pictures of the demarcation points that were re-marked,\ndemonstrating compliance with this item.\nAccordingly, I find that compliance has been achieved with respect to these violations.\nTherefore, the compliance terms proposed in the Notice for Item 1 are not included in this Order.\nPursuant to the authority of 49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217, Respondent is\nordered to take the following actions to ensure compliance with the pipeline safety regulations\napplicable to its operations:\n1. With respect to the violations of §§ 192.13 and 195.5 (Item 2), Respondent must\ndevelop a conversion-to-service plan and perform and document the necessary actions\nto ensure these lines are fit for the service intended for use. Chevron must provide\nPHMSA with the written plan, as well as the records demonstrating compliance with\nthe plan.\n2. With respect to the violations of §§ 192.805 and 195.505 (Item 4), Respondent\nmust ensure that all covered tasks are performed by qualified individuals. If\npersonnel are performing covered tasks but have not been qualified, then Chevron\nmust take the necessary steps to qualify them or ensure that they only perform the\ntasks while observed by qualified individuals. Chevron must complete the rectifier\ninspections by qualified individuals.\n3. Chevron must complete Compliance Items 1 and 2 within 90 days of receipt of the\nFinal Order. Chevron must submit documentation verifying compliance with both\nitems to the Director, Southwest Region, within 30 days of completing the actions.\n4. It is requested (not mandated) that Chevron maintain documentation of the safety\nimprovement costs associated with fulfilling this Compliance Order and submit the\ntotal to the Director.\nThe Director may grant an extension of time to comply with any of the required items upon a\nwritten request timely submitted by the Respondent and demonstrating good cause for an\nextension.\nFailure to comply with this Order may result in the administrative assessment of civil penalties\nnot to exceed $100,000 for each violation for each day the violation continues or in referral to the\nAttorney General for appropriate relief in a district court of the United States.\n\n\n\n9\nWARNING ITEMS\nThe Notice alleged probable violations of Parts 192 and 195 specifically considered to be\nwarning items. The warning were for:\n49 C.F.R. § 192.317 (Item 3) ─ Respondent’s alleged failure to protect\na portion of its system from hazards and potential damage. The OPS\ninspector discovered structural steel and cable debris on the pipeline\nrisers at Bay Marchand Block Number 3 platform C&I. On September\n16, 2010, Chevron indicated that it had removed the structural steel from\nthe risers.\n49 C.F.R. § 195.404 (Item 5) ─ Respondent’s alleged failure to maintain\ncurrent maps and records for its pipeline systems. During the inspection,\nChevron personnel were observed using an old map that lacked the\nrequired attributes and detail. In its Response, Chevron stated that this\nmap was for internal use and was not intended to demonstrate\ncompliance with § 195.404.\nIf OPS finds a violation of these provisions in a subsequent inspection, Respondent may be\nsubject to future enforcement action.\nUnder 49 C.F.R. § 190.215, Respondent has a right to submit a Petition for Reconsideration of\nthis Final Order. The petition must be sent to: Associate Administrator, Office of Pipeline\nSafety, PHMSA, 1200 New Jersey Avenue, SE, East Building, 2nd Floor, Washington, DC\n20590, with a copy sent to the Office of Chief Counsel, PHMSA, at the same address. PHMSA\nwill accept petitions received no later than 20 days after receipt of service of this Final Order by\nthe Respondent, provided they contain a brief statement of the issue(s) and meet all other\nrequirements of 49 C.F.R. § 190.215. The filing of a petition automatically stays the payment of\nany civil penalty assessed. Unless the Associate Administrator, upon request, grants a stay, all\nother terms and conditions of this Final Order are effective upon service in accordance with\n49 C.F.R. § 190.5.\nThe terms and conditions of this Final Order are effective upon service in accordance with\n49 C.F.R. § 190.5.\n___________________________________ __________________________\nJeffrey D. Wiese Date Issued\nAssociate Administrator\nfor Pipeline Safety\n\n420119001_NOPV PCP PCO_08092011_text.pdf\n\nNOTICE OF PROBABLE VIOLATION\nPROPOSED CIVIL PENALTY\nand\nPROPOSED COMPLIANCE ORDER\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nAugust 9, 2011\nMr. Warner Williams\nVice President GOM\nChevron USA Inc.\n100 Northpark Blvd\nCovington, LA 70433\nCPF 4-2011-9001\nDear Mr. Williams:\nDuring the months of March 2010 through May 2010, a representative of the Pipeline and\nHazardous Materials Safety Administration (PHMSA) pursuant to Chapter 601 of 49 United\nStates Code was onsite and inspected your procedures records and facilities in Covington,\nLafayette, Cameron and LaFourche Parish, LA; and the Gulf of Mexico offshore facilities in the\nWest Cameron, Bay Marchand and Grand Isle areas. Subsequent follow up inspection activities\ncontinued until December 2010. Chevron USA operates both natural gas and hazardous liquid\npipelines in this area so an inspection involving both Parts 192 and 195 was performed.\nAs a result of the inspection, it appears that you have committed probable violations of the\nPipeline Safety Regulations, Title 49, Code of Federal Regulations. The items inspected and the\nprobable violation(s) are:\n1. §192.10 Outer continental shelf pipelines.\nOperators of transportation pipelines on the Outer Continental Shelf (as defined in\nthe Outer Continental Shelf Lands Act; 43 U.S.C. 1331) must identify on all their\nrespective pipelines the specific points at which operating responsibility transfers to\na producing operator.\n\n\n\n§195.9 Outer continental shelf pipelines.\nOperators of transportation pipelines on the Outer Continental Shelf must identify\non all their respective pipelines the specific points at which operating responsibility\ntransfers to a producing operator. For those instances in which the transfer points\nare not identifiable by a durable marking, each operator will have until September\n15, 1998 to identify the transfer points. If it is not practicable to durably mark a\ntransfer point and the transfer point is located above water, the operator must\ndepict the transfer point on a schematic maintained near the transfer point. If a\ntransfer point is located subsea, the operator must identify the transfer point on a\nschematic which must be maintained at the nearest upstream facility and provided\nto PHMSA upon request. For those cases in which adjoining operators have not\nagreed on a transfer point by September 15, 1998 the Regional Director and the\nMMS Regional Supervisor will make a joint determination of the transfer point.\nChevron USA did not identify the demarcation between production and transportation pipeline\nfacilities in certain areas. Chevron USA did not identify where the piping changed from\nproduction to transportation on natural gas and oil transportation facilities on platforms:\n• Grand Isle Block Number 37 platform R\n• Bay Marchand Block Number 3 platform C&I\n• Bay Marchand Block Number 3 platform K&N\nWhen these demarcation points could not be visually located during the field portion of the\ninspection, PHMSA requested that Chevron USA provide the schematic that would show these\ndemarcations and identify which piping was subject to DOT requirements and which piping was\nsubject to DOI requirements. Chevron USA did not produce a schematic depicting the transfer\npoint and how it was maintained at the nearest upstream facility.\n2. §192.13 What general requirements apply to pipelines regulated under this part?\n(a) No person may operate a segment of pipeline that is readied for service listed in\nthe first column that is readied for service after the date in the second column,\nunless:\n(1) The pipeline has been designed, installed, constructed; initially inspected,\nand initially tested in accordance with this part; or\n(2) The pipeline qualifies for use under this part according to the requirements\nin §192.14.\n§195.5 Conversion to service subject to this part.\n(a) A steel pipeline previously used in service not subject to this part qualifies for\nuse under this part if the operator prepares and follows a written procedure to\naccomplish the following:\n(1) The design, construction, operation, and maintenance history of the pipeline\nmust be reviewed, and where sufficient historical records are not available,\nappropriate tests must be performed to determine if the pipeline is in\nsatisfactory condition for safe operation. If one or more of the variables are2\n\n\n\nnecessary to verify the design pressure under §195.106 or to perform the testing\nunder paragraph (a) (4) of this section is unknown, the design pressure may be\nverified and the maximum operating pressure determine by-\n(i) Testing the pipeline in accordance with ASME B31.8, Appendix N, to\nproduce a stress equal to the yield strength; and\n(ii) Applying, to not more than 80 percent of the first pressure that\nproduces a yielding, the design factor F in §195.106(a) and the appropriate\nfactors in §195.106(e).\n(2) The pipeline right-of-way, all aboveground segments of the pipeline, and\nappropriately selected underground segments must be visually inspected for\nphysical defects and operating conditions which reasonably could be expected\nto impair the strength or tightness of the pipeline.\n(3) All known unsafe defects and conditions must be corrected in accordance\nwith this part.\n(4) The pipeline must be tested in accordance with the subpart E of this part to\nsubstantiate the maximum operating pressure permitted by §195.406.\n(c) Each operator must keep for the life of the pipeline a record of the\ninvestigations, tests, repairs, replacements, and alterations made under the\nrequirements of paragraph (a) of this section.\nChevron USA failed to follow written conversion to service procedures and maintain records\ndemonstrating that the applicable conversion to service requirements were implemented for\ncertain pipelines being operated as DOT pipelines that were not previously in DOT service.\nChevron USA’s written operating and maintenance procedures (Chevron USA DOT Manual\nsection 170) and 49 CFR Parts 192 and 195 require that a written plan and records regarding the\nconversion to service of pipelines not previously operated under 49 CFR Part 192 and 195 be\ndeveloped and maintained.\nSpecifically, Chevron USA did not demonstrate that a written plan was followed and there were\nno records available regarding the conversion to service to 49 CFR Part 192 for the 6” gas line\nbetween Grand Isle 37R and Bay Marchand Block Number 3 C&I (6” Gas). Chevron began\nusing the 6” Gas line on December 19, 2008 and it was still in service at the time of the audit.\nPrior to this it was operated under DOI requirements. Chevron USA did not demonstrate that\nthe applicable conversion to service requirements were implemented or produce any conversion\nto service records when these materials were requested by PHMSA’s inspector.\nA written plan was not followed and there were no records available regarding the conversion to\nservice to 49 CFR Part 195 for the 6 inch oil line from Bay Marchand Block Number 3 platform\nE to Bay Marchand Block Number 3 platform C&I (6” Oil). Chevron began using the 6” Oil\nline July 3, 2010. Chevron USA did not demonstrate that the applicable conversion to service\nrequirements were implemented or produce any conversion to service records when these\nmaterials were requested by PHMSA’s inspector.\n3\n\n\n\nOne observation during the field portion that indicates that a pipeline condition survey was not\ncompleted per §195.5 is that the incoming riser at Bay Marchand Block Number 3 platform E\nwas unsupported due to pipe supports corroding and had become unattached from the platform.\nThis pipeline was under hydro test at the time of inspection. Subsequent to the inspection Chevron\nUSA indicated via email dated June 14, 2010, that the riser clamp and valve support repairs at\nBay Marchand Block Number 3 platform E had been completed by June 13, 2010.\n3. §192.317 Protection from hazards.\n(a) The operator must take all practicable steps to protect each transmission line or\nmain from washouts, floods, unstable soil, landslides, or other hazards that may\ncause the pipeline to move or to sustain abnormal loads. In addition, the operator\nmust take all practicable steps to protect offshore pipelines from damage by mud\nslides, water currents, hurricanes, ship anchors, and fishing operations\n(b) Each above ground transmission line or main, not located offshore or in inland\nnavigable water areas, must be protected from accidental damage by vehicular\ntraffic or other similar causes, either by being placed at a safe distance from the\ntraffic or by installing barricades.\n(c) Pipelines, including pipe risers, on each platform located offshore or in inland\nnavigable waters must be protected from accidental damage by vessels.\nChevron USA did not take steps to protect a portion of its pipeline system from hazards and\npotential damage. During the field portion of the inspection there was structural steel and cable\ndebris observed to be lying on the pipeline risers at Bay Marchand Block Number 3 Platform\nC&I. Chevron USA indicated via email dated September 16, 2010 that the structural steel had\nbeen removed from the risers.\n4. §192.805 Qualification Program. §195.505 Qualification Program\nEach operator shall have and follow a written qualification program. The program\nshall include provisions to:\n(a) Identify covered tasks;\n(b) Ensure through evaluation that individuals performing covered tasks are\nqualified;\n(c) Allow individuals that are not qualified pursuant to this subpart to perform a\ncovered task if directed and observed by an individual that is qualified;\nChevron USA did not ensure that certain covered tasks, rectifier inspections, were performed by\na qualified individual. The Sabine Gas Plant rectifier was only inspected once between April 1,\n2008 and February 20, 2010 by an OQ qualified individual. While it was checked by non-\nqualified individuals on a more frequent basis, records provided in connection with the audit\nindicate that this OQ qualified individual was actually only qualified to perform covered task\nCT04 (rectifier maintenance and repair).\nThe Sabine Gas Plant rectifier supplies cathodic protection current for both the 6-inch oil line\nand the 18-inch gas line. This device is required by both Parts 192 and 195 to be inspected six\n4\n\n\n\ntimes a year with intervals not exceeding 2 ½ months. Inspecting this rectifier is identified as a\ncovered task per the regulations and Chevron USA’s procedures (Task CT03). All inspections of\nthis covered task must be performed by a qualified person.\n5. §195.404 Maps and Records.\n(a) Each operator shall maintain current maps and records of its pipeline systems\nthat include at least the following information;\n(1) Location and identification of the following pipeline facilities;\n(i) Breakout tanks;\n(ii) Pump stations;\n(iii) Scraper and sphere facilities;\n(iv) Pipeline valves;\n(v) Facilities to which §195.402(c)(9) applies;\n(vi) Rights-of-w","truncated":true,"body_characters":48466}