{"operation":"document","citation":"CPF 420145023","title":"PHILLIPS 66 PIPELINE LLC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2014-09-22","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.402(a), 195.432(b), 195.505, 195.505(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-420145023.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-420145023.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-420145023","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/420145023","body":"Notice of Probable Violation involving PHILLIPS 66 PIPELINE LLC. PHMSA's enforcement data identifies the cited regulations as 195.402(a),  195.432(b),  195.505,  195.505(a). The case was opened on 2014-09-22 and is reported as closed as of 2018-05-14. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n420145023_Closure Letter_05142018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420145023/420145023_Closure%20Letter_05142018.pdf\n\n420145023_Closure Letter_05142018_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420145023/420145023_Closure%20Letter_05142018_text.pdf\n\n420145023_Final Order_07242015.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420145023/420145023_Final%20Order_07242015.pdf\n\n420145023_Final Order_07242015_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420145023/420145023_Final%20Order_07242015_text.pdf\n\n420145023_NOPV PCO_09222014.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420145023/420145023_NOPV%20PCO_09222014.pdf\n\n420145023_NOPV PCO_09222014_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420145023/420145023_NOPV%20PCO_09222014_text.pdf\n\n420145023_Operator Response to the Notice_10232014.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420145023/420145023_Operator%20Response%20to%20the%20Notice_10232014.pdf\n\n420145023_Closure Letter_05142018_text.pdf\n\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nMay 14, 2018\nMr. Todd Denton\nPresident\nPhillips 66 Pipeline LLC\n1075 W Sam Houston Pkwy\nN. Suite 200 N812-03\nHouston, TX 77043\nCPF 4-2014-5023\nDear Mr. Denton:\nOn July 24, 2015, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued\nto Phillips 66 Pipeline LLC a Final Order in the above-referenced case. This Order included a\nCompliance Order. Based on our review of the documentation you provided, it has been\ndetermined that you have complied with the terms of this Order.\nAccordingly, this case is now closed and no further action is contemplated with respect to the\nmatters involved in this case. Thank you for your cooperation in this matter.\nSincerely,\nMary L. McDaniel, P.E.\nDirector, Southwest Region\nOffice of Pipeline Safety\nPipeline and Hazardous Materials Safety Administration\n\n420145023_Final Order_07242015_text.pdf\n\nJuly 24, 2015\nMr. Todd Denton\nPresident\nPhillips 66 Pipeline, LLC\n3010 Briarpark Drive\nHouston, TX 77042\nRe: CPF No. 4-2014-5023\nDear Mr. Denton:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation and specifies actions that need to be taken by Phillips 66 Pipeline, LLC, to comply with\nthe pipeline safety regulations. When the terms of the compliance order have been completed, as\ndetermined by the Director, Southwest Region, this enforcement action will be closed. Service\nof the Final Order by certified mail is deemed effective upon the date of mailing, or as otherwise\nprovided 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. Rod Seeley, Southwest Regional Director, PHMSA OPS\nMr. Todd Tullio, Manager, Regulatory Compliance Phillips 66 Pipeline, LLC\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 )\nPhillips 66 Pipeline, LLC, ) CPF No. 4-2014-5023\n)\n)\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nBetween January and May 2014, pursuant to 49 U.S.C. § 60117, a representative of the Pipeline\nand Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),\nconducted on-site pipeline safety inspections of the facilities and records of Phillips 66 Pipeline,\nLLC (Phillips 66 Pipeline or Respondent), in Texas and Louisiana. Phillips 66 Pipeline, a\nwholly-owned subsidiary of Phillips 66, transports raw and finished petroleum products through\nmore than 12,000 miles of pipelines throughout Canada, California, the South and the Midwest.\nPhillips 66 Pipeline also operates multiple finished-product, liquefied petroleum gas and crude\noil terminals.1\nAs a result of the inspection, the Director, Southwest Region, OPS (Director), issued to\nRespondent, by letter dated September 22, 2014, a Notice of Probable Violation and Proposed\nCompliance Order (Notice), which also included warnings pursuant to 49 C.F.R. § 190.205. In\naccordance with 49 C.F.R. § 190.207, the Notice proposed finding that Phillips 66 Pipeline had\ncommitted various violations of 49 C.F.R. Part 195 and proposed ordering Respondent to take\ncertain measures to correct the alleged violations. The warning items required no further action,\nbut warned the operator to correct the probable violation or face possible enforcement action.\nPhillips 66 Pipeline responded to the Notice by letter dated October 23, 2014 (Response). The\ncompany stated that it elected “to not contest the Proposed Compliance Order” and agreed to\nprovide information concerning the corrective actions it intended to take once it received the\nFinal Order.\n2 Respondent did not request a hearing and therefore has waived its right to one.\n1 See www.phillips66pipeline.com. (Current as of April 1, 2015)\n2 Response, at 1.\n\n\n\nCPF No. 4-2014-5023\nPage 2\nFINDINGS OF VIOLATION\nThe Notice alleged that Phillips 66 Pipeline violated 49 C.F.R. Part 195, as follows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.402(a), which states:\n§ 195.402 Procedural manual for operations, maintenance, and\nemergencies.\n(a) General. Each operator shall prepare and follow for each pipeline\nsystem a manual of written procedures for conducting normal operations\nand maintenance activities and handling abnormal operations and\nemergencies. This manual shall be reviewed at intervals not exceeding 15\nmonths, but at least once each calendar year, and appropriate changes\nmade as necessary to insure that the manual is effective. This manual\nshall be prepared before initial operations of a pipeline system commence,\nand appropriate parts shall be kept at locations where operations and\nmaintenance activities are conducted.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.402(a) by failing to follow its own\nwritten procedures for conducting normal operations and maintenance activities. Specifically,\nthe Notice alleged that Phillips 66 Pipeline had a procedure, Annual Tank Inspection Report,\nRev. 4 – Effective Date: 2012-04-02, which required the visual inspection of internal floating\nroofs on tanks. According to the instructions for preparing such reports, if certain portions of the\nreport form did not apply, then the question was to be marked through, indicating that the\nquestion was not applicable. The Notice alleged that company personnel had marked “not\napplicable” on lines 28 (a) through (f) of two September 27, 2013 Annual Tank Inspection\nReports,3 pertaining to the inspection of internal floating roofs. The company had previously\ncompleted such inspections of the same two internal floating roofs on October 15, 2012. The\nNotice further alleged that the company had previously filed DOT Tank Data reports indicating\nthat both tanks had internal floating roofs. Therefore, PHMSA alleged that inspections of these\ntwo internal floating roofs had not been performed by the company in 2013.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.402(a) by failing to follow its\nown written procedures for conducting normal operations and maintenance activities.\nItem 3: The Notice alleged that Respondent violated 49 C.F.R. § 195.432(b), which states:\n§ 195.432 Inspection of in-service breakout tanks.\n(a) . . .\n(b) Each operator must inspect the physical integrity of in-service\natmospheric and low-pressure steel aboveground breakout tanks according\nto API Standard 653 (incorporated by reference, see § 195.3). However, if\nstructural conditions prevent access to the tank bottom, the bottom\n3 Tank 80003 in Pecan Grove and Tank 11 at Clifton Ridge Marine Terminal.\n\n\n\nCPF No. 4-2014-5023\nPage 3\nintegrity may be assessed according to a plan included in the operations\nand maintenance manual under § 195.402(c)(3).\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.432(b) by failing to properly\ninspect the physical integrity of in-service atmospheric and low-pressure steel aboveground\nbreakout tanks in accordance with API Standard 653. Specifically, the Notice alleged that\nPhillips 66 Pipeline failed to inspect the company’s Tank #144 in accordance with Standard 653\nwhen it used a corrosion rate of zero for UPr (i.e., maximum rate of corrosion on the bottom side\nof the tank bottom plate), despite documented instances of underside corrosion found during an\nearlier inspection in 2004. Under Standard 653, an operator may use a soil corrosion rate of zero\nwhen determining future inspection intervals, but not when historic corrosion has taken place.\n5\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.432(b) by failing to properly\ninspect the physical integrity of in-service atmospheric and low-pressure steel aboveground\nbreakout tanks in accordance with Standard 653.\nItem 4: The Notice alleged that Respondent violated 49 C.F.R. § 195.432(b), as quoted above,\nby failing to inspect the physical integrity of in-service aboveground breakout Tank #39\naccording to Standard 653. Specifically, the Notice alleged that Tank #39 at the Clifton Ridge\nMarine Terminal, Lake Charles, Louisiana, was constructed in 1981, and according to interim\ndocumentation should have been inspected no later than May 3, 1999. According to\ndocumentation an inspection was not performed until 2001.\nIn addition, at the time of PHMSA's 2014 inspection, there was insufficient documentation to\nestablish corrosion rates for the tank bottom, either for the top side or the soil side. Based upon\nthis lack of information, Standard 653 considers the corrosion rate to be “unknown,” and\ntherefore the maximum internal inspection interval should be set at 10 years. At the time of the\n2014 inspection, Phillips 66 Pipeline had not performed an internal inspection of Tank #39 and\nhad set the re-inspection interval at the maximum interval of 20 years.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.432(b) by failing to inspect the\nphysical integrity of in-service aboveground breakout Tank #39 according to Standard 653.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nThe Notice proposed a compliance order with respect to Items 1, 3, and 4 in the Notice for\nviolations of 49 C.F.R. §§ 195.402(a), and 195.432(b). Under 49 U.S.C. § 60118(a), each person\nCOMPLIANCE ORDER\n4 Located at the company’s Lake Charles Pipeline Facility in Sulphur, Louisiana.\n5 API 653, Section 6.4.2\n\n\n\nCPF No. 4-2014-5023\nPage 4\nwho engages in the transportation of hazardous liquids or who owns or operates a pipeline\nfacility is required to comply with the applicable safety standards established under chapter 601.\nPursuant to the authority of 49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217, Phillips 66 Pipeline\nis ordered to take the following actions to ensure compliance with the pipeline safety regulations\napplicable to its operations:\n1. With respect to the violation of § 195.402(a) (Item 1), Respondent must follow\nPhillips 66 Pipeline’s written procedures, inspect, and provide documentation to\nindicate that the internal floating roofs on Tank 80003 in Pecan Grove and Tank 11 at\nClifton Ridge Marine Terminal have been inspected.\n2. With respect to the violation of § 195.432(b) (Item 3), Respondent must develop\nprocedures that clearly identify when a corrosion rate of zero can be assumed. The\ncompany must also develop a procedure that clearly identifies if an historic corrosion\nhas occurred, and establish appropriate corrosion rate from the measured data in\naccordance with API 653. After developing procedures, Phillips 66 Pipeline must re-\nevaluate its tank inspection intervals against the revised procedures to ensure that the\ninternal inspection intervals are calculated in accordance with API 653 and that\ninspections occur prior to reaching the minimum plate thickness necessary to ensure\ntank plate integrity.\n3. With respect to the violation of § 195.432(b) (Item 4), Respondent must conduct\nan API 653 internal inspection. If Phillips 66 Pipeline wants to utilize “similar\nservice” to determine the interval between inspections, it must develop procedures\nthat clearly identify when similar service assessments will be performed and how it\nwill be performed. Also, the company shall establish the criteria for the similar\nservice assessment, identify the responsible group, and identify what type of\npersonnel qualifications are needed to perform the similar service assessment.\n4. Provide PHMSA with documentation that verifies completion of numbers 1 – 3\nabove within 30 days following the receipt of the Final Order.\n5. It is requested (not mandated) that Phillips 66 Pipeline maintains documentation of\nthe safety improvement costs associated with fulfilling this Compliance Order and\nsubmit the total to R. M. Seeley, Director, Southwest Region, Pipeline and Hazardous\nMaterials Safety Administration. It is requested that these costs be reported in two\ncategories: 1) total cost associated with preparation/revision of plans, procedures,\nstudies and analyses; and 2) total cost associated with replacements, additions and\nother changes to pipeline infrastructure.\nThe Director may grant an extension of time to comply with any of the required items upon a\nwritten request timely submitted by Respondent and demonstrating good cause for an extension.\nFailure to comply with this Order may result in the administrative assessment of civil penalties\nnot to exceed $200,000 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\nCPF No. 4-2014-5023\nPage 5\nWARNING ITEMS\nWith respect to Items 2 and 5, the Notice alleged probable violations of Part 195 but did not\npropose a civil penalty or compliance order for these items. Therefore, these are considered to\nbe warning items. The warnings were for:\n49 C.F.R. § 195.505 (Item 2) ─ Respondent’s alleged failure to ensure, through\nevaluation, that employees were qualified to perform covered tasks on 16 separate\noccasions; and\n49 C.F.R. § 195.402(a) (Item 5) ─ Respondent’s alleged failure to follow its own\nwritten Personnel Knowledge Verification & Emergency Response Training\nprocedure.\nPhillips 66 Pipeline presented information in its Response showing that it had taken certain\nactions to address the cited items. If OPS finds a violation of any of these items in a subsequent\ninspection, Respondent may be subject to future enforcement action.\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","truncated":false,"body_characters":15570}