# MOBIL  PIPE  LINE COMPANY — Notice of Probable Violation

- **operation:** document
- **citation:** CPF 420135027
- **title:** MOBIL  PIPE  LINE COMPANY — Notice of Probable Violation
- **source type:** enforcement
- **agency:** Pipeline and Hazardous Materials Safety Administration
- **status:** historical
- **official:** true
- **published on:** 2013-11-06
- **effective on:** Not available
- **summary:** CLOSED notice of probable violation citing 195.452(b)(5), 195.452(e)(1), 195.452(h)(1), 195.452(h)(2), 195.452(j)(3).
- **machine formats:** - **json:** https://regulus.evalyn.ai/document/phmsa-enforcement-420135027.json
- **markdown:** https://regulus.evalyn.ai/document/phmsa-enforcement-420135027.md
- **app url:** https://regulus.evalyn.ai/document/phmsa-enforcement-420135027
- **source url:** https://primis.phmsa.dot.gov/enforcement-data/case/420135027
**body:**

Notice of Probable Violation involving MOBIL  PIPE  LINE COMPANY. PHMSA's enforcement data identifies the cited regulations as 195.452(b)(5),  195.452(e)(1),  195.452(h)(1),  195.452(h)(2),  195.452(j)(3). The case was opened on 2013-11-06 and is reported as closed as of 2019-08-29. Proposed civil penalty: $2,659,200. Assessed civil penalty: $274,900. Open the official case record for notices, responses, orders, and the latest status.

Official case documents:

420135027_Closure Letter_08292019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Closure%20Letter_08292019.pdf

420135027_Closure Letter_08292019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Closure%20Letter_08292019_text.pdf

420135027_Decision on the Petition for Reconsideration_04012016.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Decision%20on%20the%20Petition%20for%20Reconsideration_04012016.pdf

420135027_Decision on the Petition for Reconsideration_04012016_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Decision%20on%20the%20Petition%20for%20Reconsideration_04012016_text.pdf

420135027_Final Order_10012015.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Final%20Order_10012015.pdf

420135027_Final Order_10012015_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Final%20Order_10012015_text.pdf

420135027_HQ Grants Extended Stay of Compliance Order_02042016.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_HQ%20Grants%20Extended%20Stay%20of%20Compliance%20Order_02042016.pdf

420135027_HQ Grants Extended Stay of Compliance Order_02042016_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_HQ%20Grants%20Extended%20Stay%20of%20Compliance%20Order_02042016_text.pdf

420135027_HQ Stay of Compliance Order_11042015.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_HQ%20Stay%20of%20Compliance%20Order_11042015.pdf

420135027_HQ Stay of Compliance Order_11042015_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_HQ%20Stay%20of%20Compliance%20Order_11042015_text.pdf

420135027_NOPV PCP PCO_11062013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_NOPV%20PCP%20PCO_11062013.pdf

420135027_NOPV PCP PCO_11062013_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_NOPV%20PCP%20PCO_11062013_text.pdf

420135027_Operator Petition for Reconsideration Replaces the Original Affidavit at Tab 82 with new Supplemental Affidavit_10272015.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Operator%20Petition%20for%20Reconsideration%20Replaces%20the%20Original%20Affidavit%20at%20Tab%2082%20with%20new%20Supplemental%20Affidavit_10272015.pdf

420135027_Operator Petition for Reconsideration_10212015.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Operator%20Petition%20for%20Reconsideration_10212015.pdf

420135027_Operator_Response_and_Request_for_Hearing_12052013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Operator_Response_and_Request_for_Hearing_12052013.pdf

420135027_Order on Remand_08072018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Order%20on%20Remand_08072018.pdf

420135027_Order on Remand_08072018_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420135027/420135027_Order%20on%20Remand_08072018_text.pdf

420135027_HQ Stay of Compliance Order_11042015_text.pdf

Robert Hogfoss, Esq.
Hunton & Williams LLP
Bank of America Plaza, Ste 4100
600 Peachtree St. NE
Atlanta, GA 30308
Re: ExxonMobil Pipeline Company
CPF No. 4-2013-5027
Dear Mr. Hogfoss:
I am in receipt of the Petition for Reconsideration filed by ExxonMobil Pipeline Company
(EMPCo) on October 21, 2015. Pursuant to 49 C.F.R. § 190.243, EMPCo has exercised its right
to request that PHMSA reconsider the Final Order that was issued on October 1, 2015. As you
are aware, the Final Order found nine violations in connection with the 2013 pipeline accident
near Mayflower, Arkansas. The Agency assessed a civil penalty of $2,630,400, and ordered
corrective action set forth in a Compliance Order.
PHMSA is currently reviewing the Petition and intends to issue a decision after considering your
position on the matter. In the meantime, the filing of the Petition automatically stays payment of
the civil penalty pursuant to § 190.243(c). You have also requested that PHMSA stay the terms
of the Compliance Order until a decision is rendered on the Petition.
The terms of the Compliance Order require EMPCo to modify its integrity management program
and related processes, including those related to electric-resistance welded pipe, integrity
assessment, and management of change. After reviewing the terms of the Compliance Order,
PHMSA has determined that staying the conditions for 90 days while the Agency reviews your
Petition will not compromise safety, particularly since the pipeline remains out of service.
Accordingly, PHMSA is staying the Compliance Order until 90 days from the date of this letter.
Please note, this stay does not waive compliance with any applicable pipeline safety standards,
nor does it affect any other administrative order that concerns facilities operated by EMPCo. In
the event your Petition for Reconsideration is denied, EMPCo will be required to comply with
the terms of the Compliance Order as set forth in the Final Order.
Thank you for your cooperation in this matter.
Sincerely,
Jeffrey D. Wiese
Associate Administrator
for Pipeline Safety



cc: Mr. Rod Seeley, Director, Southwest Region, PHMSA
Ms. Catherine Little, Hunton & Williams LLP
Bank of America Plaza, Ste 4100, 600 Peachtree St. NE, Atlanta, GA 30308
VIA CERTIFIED MAIL – RETURN RECEIPT REQUESTED

420135027_Closure Letter_08292019_text.pdf

CERTIFIED MAIL - RETURN RECEIPT REQUESTED
August 29, 2019
Caroline B. Henderson
Safety, Security, Health and Environmental Manager
ExxonMobil Pipeline Company
22777 Springwoods Village Parkway
Spring, Texas 77389
CPF 4-2013-5027
Dear Ms. Henderson:
On October 1, 2015, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued to
ExxonMobil Pipeline Company (EMPCo) a Final Order in the above reference case. EMPCo challenged
the Final Order through a Petition for Reconsideration and a filing to the Fifth Circuit Court of Appeals.
On August 14, 2017, the Court issued its findings.
The Fifth Circuit ruling of the Court vacated alleged violations 1-4 and 7, and remanded violation 8. The
remaining violations 5, 6, and 9, with the associated Compliance Order Items remained. In November
2017, EMPCo met with representatives of the Southwest Region to discuss the actions taken to comply
with the remaining Compliance Order Items. The discussion included actions taken by EMPCo to resolve
the five remaining Compliance Order Items labeled as Items 3-7 in the original Final Order issued by
PHMSA.
PHMSA has reviewed the submissions by EMPCo and confirmed the payment of penalties as required.
This case is now closed.
PHMSA emphasizes the importance of EMPCo establishing and maintaining appropriate procedures for
performing in-line assessments as well as procedures for processing and reacting to any condition identified
during and following the assessment. Thank you for your cooperation in this matter.
Sincerely,
Mary L. McDaniel, P.E.
Director, Southwest Region
Pipeline and Hazardous Materials Safety Administration

420135027_Order on Remand_08072018_text.pdf

August 7, 2018
Mr. Richard E. Byrne
General Counsel
ExxonMobil Pipeline Company
22777 Springwoods Village Parkway
Energy 3, 5A.491
Spring, Texas 77389
Re: In the Matter of ExxonMobil Pipeline Company, CPF No. 4-2013-5027
Dear Mr. Byrne:
Enclosed please find the Order on Remand issued in the above-referenced case. It assesses a
reduced civil penalty of $61,900 for the violation in Item 8 of the Final Order that was originally
issued by PHMSA on October 1, 2015, and remanded by the U.S. Court of Appeals for the Fifth
Circuit on August 14, 2017. Pursuant to the terms of this order, and because the penalties for
Items 1–4 and 7 of the Final Order were vacated by the court, PHMSA is refunding Exxon civil
penalties of $2,355,500 that were already paid. When the remaining terms of the compliance
order are completed, as determined by the Director, Southwest Region, this enforcement action
will be closed. Service of this order by certified mail is effective upon the date of mailing as
provided under 49 C.F.R. § 190.5.
Thank you for your cooperation in this matter.
Sincerely,
Alan K. Mayberry
Associate Administrator
for Pipeline Safety
Enclosure
cc: Ms. Mary McDaniel, Director, Southwest Region, Office of Pipeline Safety, PHMSA
Mr. Johnnie R. Randolph, Jr., Counsel, Exxon Mobil Corporation
Mr. Reagan Simpson, YetterColeman, LLP
Mr. Robert Hogfoss, Ms. Catherine Little, Ms. Annie Cook, Troutman Sanders, LLP
CERTIFIED MAIL - RETURN RECEIPT REQUESTED



U.S. DEPARTMENT OF TRANSPORTATION
PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION
OFFICE OF PIPELINE SAFETY
WASHINGTON, D.C. 20590
___________________________________
In the Matter of )
ExxonMobil Pipeline Company, ) CPF No. 4-2013-5027
)
)
)
Respondent. )
___________________________________ )
ORDER ON REMAND
On October 1, 2015, pursuant to 49 C.F.R. § 190.213, PHMSA issued a Final Order to
ExxonMobil Pipeline Company (Exxon) as a result of an investigation into the Pegasus Pipeline
failure that occurred near the town of Mayflower, Arkansas in March 2013 (Failure).1 The Final
Order found that Exxon had committed nine violations of the pipeline safety regulations in
connection with the Failure (Items 1–9), assessed a civil penalty of $2,630,400 for the violations,
and ordered Exxon to complete certain corrective actions. In accordance with 49 C.F.R. §
190.243, PHMSA affirmed the Final Order in a Decision on Petition for Reconsideration issued
April 1, 2016.2
Thereafter, Exxon filed a Petition for Review with the U.S. Court of Appeals for the Fifth
Circuit, challenging the agency’s Final Order and Decision. On August 14, 2017, the court
issued a decision vacating Items 1–4 and 7, affirming the violation in Item 8, and remanding that
item to PHMSA with instructions to reevaluate the basis for the penalty associated with Item 8.
The court left undisturbed Items 5, 6, and 9.
On remand, PHMSA has reevaluated the civil penalty for Item 8 consistent with the court’s
conclusion that the violation did not cause or contribute to the Failure. For the reasons set forth
below, PHMSA is assessing a reduced civil penalty of $61,900 for Item 8.
1 The pipeline failure occurred on March 29, 2013, in a residential area and resulted in the release of
approximately 5,000 barrels of crude oil, the evacuation of 22 households, and estimated property damage
over $57 million. ExxonMobil Pipeline Co., CPF No. 4-2013-5027, 2015 WL 7175715 (Oct. 1, 2015).
2 ExxonMobil Pipeline Co., CPF No. 4-2013-5027, 2016 WL 2753318 (April 1, 2016). Enforcement
decisions can also be viewed on PHMSA’s website at http://www.phmsa.dot.gov/pipeline/enforcement
(follow links for Enforcement Information for Specific Operators).



CPF No. 4-2013-5027
Page 3
ASSESSMENT OF REDUCED PENALTY
In determining the amount of a civil penalty, pursuant to 49 U.S.C. § 60122 and 49 C.F.R.
§ 190.225, PHMSA must consider the following criteria: the nature, circumstances and gravity of
the violation, including adverse impact on the environment; the degree of Respondent’s
culpability; the history of Respondent’s prior offenses; the good faith of Respondent in
attempting to comply with the pipeline safety regulations; and the effect on Respondent’s ability
to continue in business.
Item 8 of the Final Order found that Exxon violated 49 C.F.R. § 195.452(b)(5) by failing to
follow its written procedures for implementing its integrity management program. The Final
Order assessed a civil penalty of $783,300 for the violation.
With regard to the nature, circumstances and gravity of the violation, the Final Order concluded
the highest level of gravity was implicated because the violation was a causal factor in the
Failure. Specifically, Exxon’s procedures required the operator to follow certain procedures in
implementing its integrity management program that involved assessing risk by answering
questions about the condition of the Pegasus Pipeline. One of the questions asked whether or not
an integrity assessment had been performed on the pipeline to evaluate seam integrity and to
identify conditions requiring repair. While using the program, Exxon answered “yes” to this
question, even though the company had not performed an integrity assessment. Exxon had
planned to perform an integrity assessment in the near future and therefore answered this
question incorrectly to reflect the future tool run. However, the tool run was not actually
performed when planned and eventually was postponed another several years.
The Failure that occurred in March 2013 resulted from a failure of the pipeline’s longitudinal
seam—the very threat that the operator’s risk assessment was supposed to address. In the Final
Order, PHMSA found that the failure to follow the risk assessment program procedures had the
highest level of gravity because the violation was a causal factor in the Failure. The Fifth Circuit
concluded, however, that PHMSA erred in finding Item 8 had the highest level of gravity—
finding the violation was not a causal factor in the accident. The court reasoned that even though
Exxon answered “yes” and failed to run an inline inspection tool for several years, once the
company ran the tool, it did not detect the anomaly that eventually failed. The court reasoned
that even if the tool had been timely run, the accident would not have been prevented. The court
remanded to PHMSA to reevaluate what would be an appropriate penalty for Item 8 in light of
this determination.
On remand, PHMSA finds the highest levels of gravity are not appropriate for this violation in
light of the court’s determination. Having reviewed the record, PHMSA finds that the
appropriate gravity level is that pipeline safety or integrity had been compromised in a high
consequence area (HCA). Exxon’s failure to follow procedures for assessing the integrity of its
pipeline created unnecessary risk to safety, even if an accident did not directly result from the
error. Misapplying the risk assessment program produced an inaccurate evaluation of the
pipeline’s safety condition and avoided documenting the need to perform additional integrity
assessments. It also allowed unknown conditions on the pipeline to go unidentified or evaluated
for several years until an inline inspection was finally performed. Further, the violation occurred



CPF No. 4-2013-5027
Page 4
in a residential area that meets the definition of an HCA. Because the violation compromised
safety in an HCA, but did not cause or contribute to the Failure, the civil penalty must be
reduced.
PHMSA also reviewed the record with regard to the other assessment factors and found no
reason to depart from the findings in the Final Order. Accordingly, having reviewed the record
and considered the assessment criteria, PHMSA assesses a reduced penalty of $61,900 for the
violation of § 195.452(b)(5) in Item 8.
Disposition of penalties already paid. On April 21, 2016, twenty days following PHMSA’s
Decision on Petition for Reconsideration, Exxon paid the total assessed civil penalty of
$2,630,400 by wire transfer. Because the penalties for Items 1–4 and 7, totaling $1,634,100,
were vacated and the penalty for Item 8 is now reduced by $721,400, Exxon must be refunded
$2,355,500. The penalties paid for Items 5, 6, and 9, totaling $213,000, are not affected.
PHMSA will therefore initiate a refund of $2,355,500 upon issuance of this Order.
Disposition of compliance order. The Final Order contained a Compliance Order that required
Exxon to complete certain corrective actions to address the violations in Items 1, 2, 5, 6, and 8.
Items 1 and 2 have been vacated and therefore the terms of the compliance order associated with
those items are vacated. The remaining terms of the compliance order, including those
associated with Items 5, 6, and 8, are not otherwise affected by this Order and must be completed
by Respondent.
This Order is issued pursuant to 49 C.F.R. § 190.213. Under § 190.243, Respondent may submit
a petition for reconsideration of this Order to the Associate Administrator for Pipeline Safety,
PHMSA, 1200 New Jersey Avenue SE, East Building, 2nd Floor, Washington, D.C. 20590, no
later than 20 days after receipt of the Order by Respondent. A petition must contain a statement
of the issue(s) and meet all other requirements of 49 C.F.R. § 190.243.
The terms and conditions of this Order are effective upon service in accordance with 49 C.F.R.
§ 190.5.
August 7, 2018
___________________________________ __________________________
Alan K. Mayberry Date Issued
Associate Administrator
for Pipeline Safety

420135027_HQ Grants Extended Stay of Compliance Order_02042016_text.pdf

February 04, 2016
Robert E. Hogfoss, Esq.
Hunton & Williams LLP
Bank of America Plaza, Suite 4100
600 Peachtree St. NE
Atlanta, GA 30308
Re: ExxonMobil Pipeline Company
CPF No. 4-2013-5027
Dear Mr. Hogfoss:
I am in receipt of the January 26, 2016, Motion to Extend Stay of Compliance Order filed by
ExxonMobil Pipeline Company (EMPCo), which concerns the Final Order in the above-
referenced case. The Final Order that was issued on October 1, 2015, found nine violations
related to a 2013 pipeline accident near Mayflower, Arkansas, assessed a civil penalty of
$2,630,400, and ordered corrective action set forth in a Compliance Order.
EMPCo filed a Petition for Reconsideration on October 21, 2015. Pursuant to 49 C.F.R.
§ 190.243, the filing of the Petition automatically stayed payment of the civil penalty. By letter
dated November 4, 2015, PHMSA granted your request to stay the Compliance Order while the
Agency reviewed the Petition. The stay will expire February 2, 2016.
PHMSA has determined that extending the stay for an additional 60 days while the pipeline
remains out of service will not compromise safety. Accordingly, in response to your request, the
stay is extended for 60 days from the date of this letter, unless a final decision on the Petition is
issued before then.
This stay does not waive compliance with any applicable pipeline safety standards, nor does it
affect any other administrative proceeding that may concern facilities operated by EMPCo.
Thank you for your cooperation in this matter.
Sincerely,
Jeffrey D. Wiese
Associate Administrator
for Pipeline Safety
cc: Mr. Rod Seeley, Director, Southwest Region, PHMSA
Ms. Catherine Little, Hunton & Williams LLP
Bank of America Plaza, Ste 4100, 600 Peachtree St. NE, Atlanta, GA 30308
VIA CERTIFIED MAIL – RETURN RECEIPT REQUESTED

420135027_NOPV PCP PCO_11062013_text.pdf

NOTICE OF PROBABLE VIOLATION
and
PROPOSED COMPLIANCE ORDER
CERTIFIED MAIL - RETURN RECEIPT REQUESTED
November 6, 2013
Mr. Gary W. Pruessing
President
ExxonMobil Pipeline Company, LP
800 Bell Street
Room 3180H
Houston, TX 77002
Dear Mr. Pruessing: CPF No. 4-2013-5027
On March 29, 2013, the Pegasus Pipeline ruptured near the town of Mayflower, Arkansas
releasing an estimated 5,000 barrels of crude oil in a high consequence area (HCA)1. As a result
of this accident and pursuant to Chapter 601 of 49 United States Code, representatives of the
Pipeline and Hazardous Materials Safety Administration (PHMSA) investigated the accident and
inspected operation and maintenance records and procedures related to the Pegasus Pipeline,
which is operated by ExxonMobil Pipeline Company (EMPCo)2
. From this point, reference to
“the operator” will refer to the assets involved in this release identified as Mobil Pipeline
operated by ExxonMobil Pipeline Company.
As a result of the investigation and subsequent inspection, it appears that you have committed
probable violations of the Pipeline Safety Regulations, Title 49, Code of Federal Regulations.
The probable violation(s) are:
1. § 195.452 Pipeline integrity management in high consequence areas.
(e) What are the risk factors for establishing an assessment schedule (for both the
baseline and continual integrity assessments)?
1 This estimate may increase when the pipeline is restarted and an actual measurement of the spill volume can be
calculated.
2 The Pegasus Pipeline is owned by Mobil Pipeline Company and operated by EMPCO.



Mr. Gary Pruessing
Mobil Pipe Line Company
CPF 4-2013-5027
(1) An operator must establish an integrity assessment schedule that prioritizes
pipeline segments for assessment (see paragraphs (d)(1) and (j)(3) of this
section). An operator must base the assessment schedule on all risk factors that
reflect the risk conditions on the pipeline segment. The factors an operator must
consider include, but are not limited to:
(i) Results of the previous integrity assessment, defect type and size that the
assessment method can detect, and defect growth rate;
(ii) Pipe size, material, manufacturing information, coating type and condition,
and seam type;
(iii) Leak history, repair history and cathodic protection history;
(iv) Product transported;
(v) Operating stress level;
(vi) Existing or projected activities in the area;
(vii) Local environmental factors that could affect the pipeline (e.g., corrosivity
of soil, subsidence, climatic);
(viii) geo-technical hazards; and
(ix) Physical support of the segment such as by a cable suspension bridge.
The integrity assessment schedule established by the operator did not include consideration of
certain manufacturing information in their determination of risk factors as required. Specifically,
the operator failed to include the susceptibility of its Youngstown, pre-1970 low frequency
electric-resistance welded (ERW) pipe seam to failures as a risk factor for the Pegasus Pipeline
System in the implementation of its integrity management program.
The operator experienced multiple hydrostatic test failures on the Pegasus Pipeline as a result of
ERW long seam failures in 1991 hydrotesting and subsequent 2005–2006 hydrotesting. The pipe
manufacturing information, fracture toughness, and hydrostatic testing failure history of the
Youngstown pre-1970 low frequency ERW pipe in the Patoka to Corsicana segments of the
Pegasus Pipeline provided more than adequate information for the pipe to be considered
susceptible to seam failure. Further, the operator did not present an acceptable engineering
analysis to PHMSA to demonstrate that the pre-1970 ERW pipe in the Pegasus Pipeline was not
susceptible to seam failure.
2. §195.452 Pipeline integrity management in high consequence areas.
(j) What is a continual process of evaluation and assessment to maintain a
pipeline's integrity?
(3) Assessment intervals. An operator must establish five-year intervals, not to
exceed 68 months, for continually assessing the line pipe's integrity. An
operator must base the assessment intervals on the risk the line pipe poses to
the high consequence area to determine the priority for assessing the pipeline
segments. An operator must establish the assessment intervals based on the
2 | P a g e



Mr. Gary Pruessing
Mobil Pipe Line Company
CPF 4-2013-5027
factors specified in paragraph (e) of this section, the analysis of the results
from the last integrity assessment, and the information analysis required by
paragraph (g) of this section.
The operator failed to establish a five-year re-assessment interval for the Patoka to Corsicana
segment of the Pegasus Pipeline after the hydrostatic test of 2005 and 2006 identified a
susceptibility to seam failures. The operator failed to consider all risk factors for establishing an
assessment schedule for continual integrity assessments when they did not consider the
pipeline’s manufacture and results of the previous integrity assessments to conclude that the
pipeline was susceptible to seam failures. The next assessment was performed in 2012 and 2013
using a TFI tool.
The operator performed an inspection using a TFI tool in a series of four tool runs that began in
July 2012 and was completed on February 6, 2013, on the Conway to Corsicana portion of the
system. The baseline assessments (hydrostatic tests) were performed in 2005 and 2006.
Therefore, this re-assessment was more than 68 months after the baseline assessments were
performed, and exceeded the maximum re-assessment intervals required by 195.452(j)(3).
3. §195.452 Pipeline integrity management in high consequence areas.
(b) What program and practices must operators use to manage pipeline integrity?
Each operator of a pipeline covered by this section must:
(5) Implement and follow the program.
(j) What is a continual process of evaluation and assessment to maintain a
pipeline’s integrity?
(4) Variance from the 5-year intervals in limited situations-
(i) Engineering basis. An operator may be able to justify an engineering
basis for a longer assessment interval on a segment of line pipe. The justification
must be supported by a reliable engineering evaluation combined with the use of
other technology, such as external monitoring technology, that provides an
understanding of the condition of the line pipe equivalent to that which can be
obtained from the assessment methods allowed in paragraph (j)(5) of this section.
An operator must notify OPS 270 days before the end of the five-year (or less)
interval of the justification for a longer interval, and propose an alternative interval.
An operator must send the notice to the address specified in paragraph (m) of this
section.
The operator failed to follow its procedure 5.1 (4) (Continual Evaluation and Assessment
Process) for a variance from the five year interval to extend the time frame for conducting its
continual assessment of the Conway to Corsicana segment of the Pegasus Pipeline and failed to
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Mr. Gary Pruessing
Mobil Pipe Line Company
CPF 4-2013-5027
notify PHMSA. The operator extended the inspection timing from “prior to 12/31/2011” to
“prior to 12/31/2012,” and again from 12/31/2012 to 2/6/2013 without providing notice to
PHMSA at least 270 days prior to the end of the five year period which expired in 2011, five-
years (NTE 68 months) from the date of the baseline hydrotest.
The operator’s procedures for Continual Evaluation and Assessment Process are included in the
IMP. Section 5 of the procedures includes the rule requirements for establishing assessment
intervals in accordance with §195.452(j)(3). The procedures included the requirements for a
variance from the 5-year intervals in limited situations. Variance from the five-year
reassessment interval was allowed when the operator was able to justify an engineering basis for
a longer assessment interval on a segment of line pipe. The operator’s procedure required
notification to PHMSA 270 days before the end of the five-year (or less) interval of the
justification for a longer interval and propose an alternative interval.
PHMSA did not receive a notice, or a request for extension from the operator to extend the
interval beyond five years for the Conway to Corsicana segment of the Pegasus Pipeline
assessment with a method capable of assessing seams in ERW pipe.
4. §195.452 Pipeline integrity management in high consequence areas.
(e) What are the risk factors for establishing an assessment schedule (for both the
baseline and continual integrity assessments)? (1) An operator must establish an
integrity assessment schedule that prioritizes pipeline segments for assessment
(see paragraphs (d)(1) and (j)(3) of this section. An operator must base the
assessment schedule on all risk factors that reflect the risk conditions on the
pipeline segment.
(j) What is a continual process of evaluation and assessment to maintain a pipeline’s
integrity?
(3) Assessment intervals. An operator must establish five-year intervals, not to exceed 68
months, for continually assessing the line pipe’s integrity. An operator must base the
assessment intervals on the risk the line pipe poses to the high consequence area to
determine the priority for assessing the pipeline segments. An operator must establish the
assessment intervals based on the factors specified in paragraph (e) of this section, the
analysis of the results from the last integrity assessment, and the information analysis
required by paragraph (g) of this section.
The operator’s integrity assessment schedule failed to prioritize pipeline segments to re-assess
the pipe that posed the highest risk to the high consequence areas before re-assessing lower risk
segments. The operator failed to prioritize the Corsicana to Conway segment higher than the
Patoka to Conway segment of the Pegasus Pipeline for reassessment related to manufacturing
flaws, and seam failure susceptibility.
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Mr. Gary Pruessing
Mobil Pipe Line Company
CPF 4-2013-5027
The Corsicana to Conway segment had more hydrotest failures in 2006 than the Conway to
Patoka segment, including the test failures that were at lower pressures than previous test levels.
This segment had all of the seam failures during the 1991 hydrotesting. This segment
experienced an in-service ERW seam leak, and had more miles of Youngstown ERW pipe. The
Conway to Foreman segment had the most actionable anomalies after the baseline assessment in
1999. The operator’s fatigue analyses resulted in the shortest required reinspection interval on
the Conway to Corsicana segment at 7.4 years, and the shortest reinspection interval on the
Patoka to Conway segment was more than 9 years.
Additionally, there were more sensitive receptors in the Corsicana to Conway segment of the
pipeline, including the Lake Maumelle Watershed. However, the operator’s decision to perform
the TFI Tool inspection on the Patoka to Conway segment first was not documented, and was not
based upon appropriate risk considerations that would indicate the TFI run should have been
performed on the Conway to Corsicana segment first.
5. §195.452 Pipeline integrity management in high consequence areas.
(h) What actions must an operator take to address integrity issues? (1) General
requirements. An operator must take prompt action to address all anomalous
conditions the operator discovers through the integrity assessment or information
analysis. In addressing all conditions, an operator must evaluate all anomalous
conditions and remediate those that could reduce a pipeline’s integrity. An operator
must be able to demonstrate that the remediation of the conditions will ensure the
condition is unlikely to pose a threat to the long-term integrity of the pipeline. An
operator must comply with §195.422 when making a repair.
The operator failed to take prompt action to address all anomalous conditions on their pipeline.
The operator failed to declare discovery of immediate repair conditions from information
received in preliminary reports from the in-line inspection (ILI) vendor, and as a result, the
operator treated “Immediate Conditions” as “Validation Digs” or “Confirmation Digs” and did
not take appropriate actions for “Immediate Conditions.”
Two examples of this are MP 164.051 and MP 142.394. Both sites were identified as immediate
repairs from the preliminary report received from the vendor on August 9, 2010; however the
operator did not identify them as immediate repairs until the sites were excavated and as a result,
the operator’s anomalous condition discovery process was carried out in a manner that was
inconsistent with the regulatory requirement. For MP 164.051, the date of identification from the
operator was identified 19 days after the vendor report on August 28, 2010, and for MP 142.394
several months after the report on January 6, 2011.
6. §195.452 Pipeline integrity management in high consequence areas.
(h) What actions must an operator take to address integrity issues?
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Mr. Gary Pruessing
Mobil Pipe Line Company
CPF 4-2013-5027
(2) Discovery of condition. Discovery of a condition occurs when an operator
has adequate information about the condition to determine that the condition
presents a potential threat to the integrity of the pipeline. An operator must
promptly, but no later than 180 days after an integrity assessment, obtain
sufficient information about a condition to make that determination, unless
the operator can demonstrate that the 180-day period is impracticable.
The operator failed to declare discovery within 180 days in four separate instances on the
Pegasus Pipeline Patoka to Corsicana segments (2010, 2011, and 2013) despite the availability of
adequate information in the vendor reports to make such determinations.
The following Table summarizes the relevant dates for the subject segments:
Patoka to Conway (2 Testable Segments)
Date of Actual
Action Date 180 Day Deadline
Discovery
MFL-Combo Run 6/10/2010 12/7/2010 3/4/2011
TFI Tool Run 8/15/2010 2/11/2011 3/4/2011
Preliminary Report 7/10/2010
Conway to Corsicana (2 Testable Segments)
Date of Actual
Action Date 180 Day Deadline
Discovery
MFL-Combo Run 7/21/2010 1/17/2011 3/15/2011
TFI Tool Run 2/6/2013 8/5/2013 8/30/2013
Preliminary Report 8/23/2010
7. §195.452 Pipeline integrity management in high consequence areas.
(b) What program and practices must operators use to manage pipeline integrity?
Each operator of a pipeline covered by this section must:
(5) Implement and follow the program.
(j) What is a continual process of evaluation and assessment to maintain a pipeline’s
integrity?
(1) General. After completing the baseline integrity assessment, an operator must
continue to assess the line pipe at specified intervals and periodically evaluate the
integrity of each pipeline segment that could affect a high consequence area.
(2) Evaluation. An operator must conduct a periodic evaluation as frequently as needed
to assure pipeline integrity. An operator must base the frequency of evaluation on risk
factors specific to its pipeline, including the factors specified in paragraph (e) of this
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Mr. Gary Pruessing
Mobil Pipe Line Company
CPF 4-2013-5027
section. The evaluation must consider the results of the baseline and periodic integrity
assessments, information analysis (paragraph (g) of this section), and decisions about
remediation, and preventive and mitigative actions (paragraphs (h) and (i) of this section).
The operator failed to follow its procedure, IMP Section 5.4, which requires risk assessments to
be updated as changes occur, which includes potential threat changes. The operator did not
follow their procedure when they extended the inspection timing of the Conway to Corsicana
segment of the Pegasus Pipeline from “prior to 12/31/2011” to “prior to 12/31/2012,” and again
from 12/31/2012 to 2/6/2013 without revising the risk analyses that relied upon the inspection
having been performed in the Summer of 2011, even though the inspection was not performed
until February 6, 2013.
The operator’s Operations Integrity Management Systems (OIMS) Element 2, Risk Assessment
& Management requires in 2.4 that “Risk assessments are updated at specified intervals and as
changes occur.” Further, the operator’s Integrity Management Program Section 5.4 requires
annual review to determine if an updated risk assessment is required. Items that must be
considered in the review include potential threat changes.
As a result of not updating the risk assessment, there were no Identified Threats on the Conway
to Foreman Segment, as demonstrated by the two analyses that were performed in March 2011.
The failure to identify an “Identified Threat” caused the integrity decisions to rely upon incorrect
bases for the analyses that were carried out that rely upon identification of threats for EFRD
analyses, additional preventive and Mitigative measures, and other risk reduction activities that
may be deemed necessary to bring the risk to an acceptable level.
8. §195.402 Procedural manual for operations, maintenance, and emergencies.
(a) General. Each operator shall prepare and follow for each pipeline system
a manual of written procedures for conducting normal operations and
maintenance activities and handling abnormal operations and emergencies.
The operator failed to follow its Operations and Maintenance procedures by selectively using
results of its Threat Identification and Risk Assessment Manual (TIARA) process in 2011 which
resulted in the failure to properly characterize the risk of a release to the Lake Maumelle
Watershed, and other HCAs in the Conway to Foreman segment of the pipeline. This resulted in
the failure to determine an “Identified Threat” related to Manufacturing existed on the segment,
and failed to elevate the threat as required by OIMS and the TIARA processes for appropriate
risk reduction activities in multiple integrity processes that rely upon the TIARA results as inputs
to the processes for risk reduction activities.
9. §195.452 Pipeline integrity management in high consequence areas.
(b) What program and practices must operators use to manage pipeline integrity?
Each operator of a pipeline covered by this section must:
(5) Implement and follow the program.
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Mr. Gary Pruessing
Mobil Pipe Line Company
CPF 4-2013-5027
(i) What is a continual process of evaluation and assessment to maintain a pipeline's
integrity?
(1) General. After completing the baseline integrity assessment, an operator must
continue to assess the line pipe at specified intervals and periodically evaluate the
integrity of each pipeline segment that could affect a high consequence area.
The operator failed to follow its procedures for creating a Management of Change document for
the merging of testable segments for their Pegasus Pipeline. The operator combined the
previously identified four segments for the Patoka to Corsicana segment to two testable
segments.
The operator's procedures, OIMS Element 7.2 Corporate Expectation to perform an
analysis of Operations Integrity Implications, required a Management of Change document to be
created for a significant change as completed in this case to ensure undervaluation of the
consequences of a change in its risk management program does not occur.
As a result of the change, the longer Testable Segments negatively impacted the TIARA risk
assessments by masking higher threat intermediate segments (such as the Lake Maumelle
Watershed and Mayflower populated areas) with the dilution of the risk scores that resulted from
the increased length of the Testable Segment.
Proposed Civil Penalty
Under 49 United States Code, § 60122, you are subject to a civil penalty not to exceed $200,000
per violation per day the violation persists up to a maximum of $2,000,000 for a related series of
violations. For violations occurring prior to January 3, 2012, the maximum penalty may not
exceed $100,000 per violation per day, with a maximum penalty not to exceed $1,000,000 for a
related series of violations. The Compliance Officer has reviewed the circumstances and
supporting documentation involved in the above probable violations and has recommended that
you be preliminarily assessed a civil penalty of $2,659,200 as follows:
Item number
PENALTY
1
$737,200
2
$737,200
3
$ 56,100
4
$ 47,500
5
$ 56,100
6
$102,200
7
$ 70,500
8
$783,300
9
$ 69,100
Proposed Compliance Order
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Mr. Gary Pruessing
Mobil Pipe Line Company
CPF 4-2013-5027
With respect to items 1, 2, 5, 6, and 8 pursuant to 49 United States Code § 60118, the Pipeline
and Hazardous Materials Safety Administration proposes to issue a Compliance Order to the
operator. Please refer to the Proposed Compliance Order, which is enclosed and made a part of
this Notice.
Response to this Not
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