{"operation":"document","citation":"CPF 420165033","title":"PERMIAN EXPRESS TERMINAL LLC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2016-10-04","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.402(a), 195.402(c)(3), 195.402(c)(7).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-420165033.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-420165033.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-420165033","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/420165033","body":"Notice of Probable Violation involving PERMIAN EXPRESS TERMINAL LLC. PHMSA's enforcement data identifies the cited regulations as 195.402(a),  195.402(c)(3),  195.402(c)(7). The case was opened on 2016-10-04 and is reported as closed as of 2020-01-06. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n420165033_Closure Letter_01062020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420165033/420165033_Closure%20Letter_01062020.pdf\n\n420165033_Closure Letter_01062020_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420165033/420165033_Closure%20Letter_01062020_text.pdf\n\n420165033_Final Order_11202019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420165033/420165033_Final%20Order_11202019.pdf\n\n420165033_Final Order_11202019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420165033/420165033_Final%20Order_11202019_text.pdf\n\n420165033_NOPV PCO_10042016.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420165033/420165033_NOPV%20PCO_10042016.pdf\n\n420165033_NOPV PCO_10042016_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420165033/420165033_NOPV%20PCO_10042016_text.pdf\n\n420165033_Operator Response to Notice_11102016.pdf: https://primis.phmsa.dot.gov/enforcement-documents/420165033/420165033_Operator%20Response%20to%20Notice_11102016.pdf\n\n420165033_Closure Letter_01062020_text.pdf\n\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nJanuary 6, 2020\nGreg McIlwain\nSenior Vice President, Operations\nPermian Express Terminal, LLC\n1300 Main Street\nHouston, Texas 77002\nCPF 4-2016-5033\nDear Mr. McIlwain:\nOn November 20, 2019, the Pipeline and Hazardous Materials Safety Administration (PHMSA)\nissued to Permian Express Terminal a Final Order in the above-referenced case. This Order\nincluded a Compliance Order requirement to amend your procedures. Based on our review of the\ndocumentation you provided, it has been determined that you have complied with the terms of this\nOrder.\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\nPipeline and Hazardous Materials Safety Administration\n\n420165033_Final Order_11202019_text.pdf\n\nNovember 20, 2019\nMr. Kelcy Warren\nChief Executive Officer\nEnergy Transfer, LP\n8111 Westchester Drive\nDallas, Texas 75225\nRe: CPF No. 4-2016-5033\nDear Mr. Warren:\nEnclosed please find the Final Order issued in the above-referenced case. It makes a finding of\nviolation and specifies actions that need to be taken by your subsidiary, SunVit Pipeline, LLC, to\ncomply with the pipeline safety regulations. When the terms of the compliance order have been\ncompleted, as determined by the Director, Southwest Region, this enforcement action will be\nclosed. Service of the Final Order by certified mail is effective upon the date of mailing, as\nprovided under 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nAlan K. Mayberry\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Ms. Mary McDaniel, Director, Southwest Region, Office of Pipeline Safety, PHMSA\nMr. David Chalson, Senior Vice President, Operations, Energy Transfer, LP, 8111\nWestchester Drive, Dallas, Texas 75225\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 )\n)\n)\nSunVit Pipeline, LLC, )\na subsidiary of Energy Transfer, LP, )\nRespondent. )\n____________________________________)\n) CPF No. 4-2016-5033\nFINAL ORDER\nFrom April 20, 2015, through July 17, 2015, pursuant to 49 U.S.C. § 60117, a representative of\nthe Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety\n(OPS), conducted an on-site pipeline safety inspection of the facilities and records of SunVit\nPipeline, LLC (SunVit), in Midland, Texas. The SunVit pipeline is a 27-mile, 20-inch diameter\npipeline that connects a 2-million-barrel crude oil terminal in Midland to the Sunoco Logistics1\nPermian Express 2 pipeline.2 SunVit pipeline and facilities are operated by Sunoco Pipeline, LP\n(SPLP or Respondent).3\nAs a result of the inspection, the Director, Southwest Region, OPS (Director), issued to\nRespondent, by letter dated October 4, 2016, a Notice of Probable Violation and Proposed\nCompliance Order (Notice). In accordance with 49 C.F.R. § 190.207, the Notice proposed\nfinding that SunVit had violated 49 C.F.R. § 195.402 and proposed ordering Respondent to take\ncertain measures to correct the alleged violation.\nSPLP responded to the Notice by letter dated November 10, 2016 (Response). The company\ncontested the allegation, offered additional information in response to the Notice, and requested\nthat the allegation of violation and associated compliance order be withdrawn. Respondent did\nnot request a hearing and therefore has waived its right to one.\n1 Sunoco Logistics is also a subsidiary of Energy Transfer, LP.\n2 Vitol sells West Texas crude assets for $720M, Houston Business Journal, available at\nhttps://www.bizjournals.com/houston/news/2016/09/27/vitol-sells-west-texas-crude-assets-for-720m.html (last\naccessed October 31, 2019). See also, Pipeline Violation Report, at 1, on file with PHMSA.\n3 SPLP Response, page 1, “The SunVit pipeline and facilities are operated by SPLP.”\n\n\n\nCPF 4-2016-5003\nPage 2\nFINDING OF VIOLATION\nThe Notice alleged that Respondent violated 49 C.F.R. Part 195, as follows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.402, which states in\nrelevant part:\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 made\nas necessary to insure that the manual is effective. This manual shall be\nprepared before initial operations of a pipeline system commence, and\nappropriate parts shall be kept at locations where operations and\nmaintenance activities are conducted.\n(b)….\n(c) The manual required by paragraph (a) of this section must include\nprocedures for the following to provide safety during maintenance and\nnormal operations:\n(1)….\n(3) Operating, maintaining, and repairing the pipeline system in\naccordance with each of the requirements of this subpart and subpart H of\nthis part.\n(4)….\n(7) Starting up and shutting down any part of the pipeline system in a\nmanner designed to assure operations within the limits prescribed by\n§ 195.406, consider the hazardous liquid or carbon dioxide in\ntransportation, variations in altitude along the pipeline, and pressure\nmonitoring and control devices.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.402(c)(3)(7) by failing to prepare\nand follow a manual of written procedures that includes procedures for starting operations of a\npipeline facility. Specifically, the Notice alleged that SunVit failed to have written procedures\nfor filling operations during the commissioning of Tank 7112 on June 10-14, 2015. The Notice\nalso alleged that the lack of written procedures was identified in internal company\ncommunications prior to the filling of the breakout tank. The Notice acknowledged that\nRespondent had a work plan for the filling of Tank 7112, but alleged that the work plan was not\na manual of written procedures that met the requirements of § 195.402, noting that the work plan\nexplicitly directed the reader to “Reference the written procedure for all guidelines.”\nIn its Response, SPLP argued that it prepared a work plan to address the commissioning\nactivities for Tank 7112, and that such a work plan satisfied the regulatory requirement for a\nprocedure. Specifically, SPLP raised three arguments. First, SPLP claimed that in a prior\n\n\n\nCPF 4-2016-5003\nPage 3\nenforcement action, CPF 4-2015-5005H, PHMSA directed SPLP to implement a work planning\nprocess and requirements to define the appropriate level of preparation, review, and approval to\nensure safe performance of activities if the scope of work is not in an existing O&M procedure.4\nSPLP argued that in the case of filling Tank 7112, that objective was achieved. Second, SPLP\nargued the work plan developed for the filling of Tank 7112 fully accounted for the specifics of\nthe operation and the requirements to fill the tank without incident, and that having a specific\nwork plan is appropriate for tank fillings. Lastly, SPLP argued that the work plan’s reference to\nwritten procedures does not inherently indicate that a separate procedure exists. Rather, SPLP\nargued that it directs the author(s) of the work plan to include reference to any applicable\nprocedures so that they can be consulted during the task set forth in the work plan.\nAnalysis\nSection 195.402 requires each pipeline operator to prepare and follow a manual of written\nprocedures for conducting normal operations and maintenance activities. The manual must\ninclude procedures to provide safety during, among other things, starting up any part of the\npipeline system.\nIn response to the allegation that Respondent failed to have a manual of written procedures for\nstarting up its pipeline facility by conducting filling operations, Respondent did not claim to have\na manual of written procedures, but instead asserted that it had a “work plan” that met the\nregulatory requirement.\nThe term “work plan” does not appear in the hazardous liquids pipeline safety regulations, but is\ncommonly used in the industry to refer to a plan developed by an operator to guide a discrete or\nparticular project. For example, following an accident, an operator may develop a work plan to\nverify the integrity of its pipeline by taking into consideration the particular factors involved in\nthat specific accident.5 A work plan developed for a one-time project is different than a manual\nof written procedures required by § 195.402, which by definition provides procedures of general\napplicability that define the methods used by the operator when conducting all operations and\nmaintenance functions on the pipeline facility. An operator’s manual of written procedures may\nestablish circumstances in which the operator prepares a project-specific work plan. For\nexample, in a prior enforcement matter PHMSA found Respondent’s manual of written\nprocedures required a work plan to be prepared for a particular repair project.6\nHaving considered these general differences between a project-specific work plan and a manual\nof written procedures required by § 195.402, I will evaluate the evidence to determine if\nRespondent met the requirements of § 195.402. Firstly, Respondent’s work plan was not\nidentified as a written procedure and was not contained in Respondent’s manual of written\n4 SPLP Response, page 2. See also, In the Matter of West Texas Gulf Pipe Line Company, Consent Agreement,\nCPF 4-2015-5005H, at 5, available at https://primis.phmsa.dot.gov/comm/reports/enforce/documents/420155005H/\n420155005H Consent%20Agreement 10032016 text.pdf (Last accessed October 31, 2019).\n5 E.g., Sunoco Logistics Partners, LP, CPF 4-2016-5030H, Item 8, 2016 WL 8199632 (Sept. 14, 2016).\n6 Sunoco Logistics Partners, LP, CPF 4-2010-5010, Item 3, 2012 WL 4846347 (Aug. 1, 2012).\n\n\n\nCPF 4-2016-5003\nPage 4\nprocedures for normal operations and maintenance activities. Respondent’s work plan did not\ninclude procedures of general applicability for Respondent’s pipeline system. The work plan\nwas developed for one-time use during the filling of Tank 7112. As Respondent acknowledged,\nthe work plan would need to be significantly altered were it to be applied to a different tank.7\nFinally, during the inspection, Respondent’s Compliance Officer stated he was not aware of any\nwritten procedures for filling tanks and a separate company email dated prior to the filling\nactivity indicated Respondent did not have a written procedure for the activity. For these\nreasons, I find Respondent’s work plan did not meet the requirements of § 195.402.\nNotwithstanding, I will address Respondent’s three additional arguments in turn. SPLP’s first\nargument is that it relied on statements PHMSA made in a prior enforcement action, CPF 4-\n2015-5005H, which directed SPLP to implement a work planning process when it did not have\nan existing O&M procedure for a particular task. PHMSA issued CPF 4-2015-5005H, a\ncorrective action order (CAO), to West Texas Gulf Pipe Line Company (West Texas), a\nsubsidiary of SPLP, following a pipeline accident that occurred on February 25, 2015. The\nfailure resulted in the release of approximate 30 barrels of crude oil. Following the February 25,\n2015 failure, there were several events, including a second West Texas leak on June 7, 2015, that\nraised additional concerns about the overall safety of the West Texas pipeline system. PHMSA\nissued an amended CAO on September 4, 2015, to address events that occurred after the Original\nCAO was issued. To resolve the safety concerns raised by the Original and Amended CAO,\nPHMSA and SPLP entered into a consent agreement. The consent agreement and order was also\ncaptioned CPF 4-2015-5005H (Consent Agreement).\nThe Consent Agreement directed SPLP to hire a third-party pipeline expert in safety\nmanagement systems and to submit a comprehensive plan on how it will address any deficiencies\nor risks identified by the third party. The Consent Agreement directed SPLP to include in its\ncomprehensive plan, “[W]ork planning process and requirements to define the appropriate level\nof preparation, review, and approval to ensure safe performance of activities if the scope of work\nis not in an existing O&M procedure.”8\nRespondent’s argument that this provision of the Consent Agreement validates the operator’s\nconduct related to the allegations in this case cannot be sustained for several reasons. The\nConsent Agreement addressed specific safety issues found on the West Texas pipeline system\nand the scope of the Consent Agreement was limited to those issues and that pipeline system.9\nThe SunVit pipeline is not a part of the West Texas pipeline system and the Consent Agreement\n7 SPLP Response, page 2, “SPLP does not disagree with the PHMSA contention that if this Work Plan was to be\ntaken and applied to a different tank, it would need to be significantly altered to add the correct valve lineup, tank\nsize, product, and account for other variables.”\n8 In the Matter of West Texas Gulf Pipe Line Company, Consent Agreement, CPF 4-2015-5005H, at 5, available at\nhttps://primis.phmsa.dot.gov/comm/reports/enforce/documents/420155005H/420155005H Consent%20Agreement\n10032016 text.pdf (Last accessed October 31, 2019).\n9 Id., at 4, Part II, Item 12: “Regarding the entire West Texas Gulf Pipe Line System, its operation, and the\nOperating, Maintenance and Construction policies and procedures under which it operates, including all aspects for\nwhich the regulations in 49 C.F.R. §195 apply to the pipeline system and its operator, Respondent must:”\n\n\n\nCPF 4-2016-5003\nPage 5\ndid not involve the filling of tanks. The terms of the Consent Agreement did not grant SPLP\npermission to start operations on a pipeline facility without a procedure and did not otherwise\nwaive compliance with § 195.402. In fact, the Consent Agreement specifically stated that it did\nnot “waive or modify any Federal, State, or local laws or regulations that are applicable to\nRespondent's pipeline systems.” Since the Consent Agreement did not waive compliance with\n§ 195.402 and otherwise did not concern the pipeline facility or safety issues at issue here, I find\nSPLP’s argument that the prior Consent Agreement validates the operator’s conduct in this\nmatter to be without merit.\nSPLP’s second argument proclaimed the benefits and appropriateness of the work plan for filling\nTank 7112. While PHMSA recognizes that Respondent will determine when development of a\nwork plan is appropriate, I have already determined that the work plan in this case did not satisfy\nthe requirements of § 195.402. Therefore, I find the discussion on the benefits of a work plan to\nbe irrelevant to the allegation of violation.\nLastly, SPLP argued that the note in the work plan to “Reference the written procedure for all\nguidelines” was not dispositive of a procedure’s existence. Ultimately, I find the reference in the\nwork plan to the possible existence of a procedure is immaterial since I have already determined\nthat Respondent did not have a written procedure and thus failed to comply with the regulatory\nrequirement of § 195.402.\nAccordingly, after considering all of the evidence and arguments, I find that Respondent violated\n49 C.F.R. § 195.402(c)(3)(7) by failing to prepare and follow a manual of written procedures that\nincludes procedures for starting operations of a pipeline facility.\nThis finding of violation will be considered a prior offense in any subsequent enforcement action\ntaken against Respondent.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Item 1 in the Notice for violation of 49\nC.F.R. § 195.402(c)(3)(7). Under 49 U.S.C. § 60118(a), each person who engages in the\ntransportation of hazardous liquids or who owns or operates a pipeline facility is required to\ncomply with the applicable safety standards established under chapter 601. Pursuant to the\nauthority of 49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217, Respondent is ordered to take the\nfollowing actions to ensure compliance with the pipeline safety regulations applicable to its\noperations:\n1. With respect to the violation of § 195.402(c)(3)(7) (Item 1), Respondent must\ndevelop and utilize a comprehensive and detailed procedure which specifically\naddresses the considerations and actions to be taken in the filling of breakout tanks.\n2. The procedure required above must be submitted to PHMSA and implemented\nwithin 30 days after receipt of the final order.\n\n\n\nCPF 4-2016-5003\nPage 6\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.\nIt is requested (not mandated) that Respondent maintain documentation of the safety\nimprovement costs associated with fulfilling this Compliance Order and submit the total to the\nDirector. It is requested that these costs be reported in two categories: (1) total cost associated\nwith preparation/revision of plans, procedures, studies and analyses; and (2) total cost associated\nwith replacements, additions and other changes to pipeline infrastructure.\nFailure to comply with this Order may result in the administrative assessment of civil penalties\nnot to exceed $200,000, as adjusted for inflation (49 C.F.R. § 190.223), for each violation for\neach day the violation continues or in referral to the Attorney General for appropriate relief in a\ndistrict court of the United States.\nUnder 49 C.F.R. § 190.243, Respondent may submit a Petition for Reconsideration of this Final\nOrder to the Associate Administrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey\nAvenue, SE, East Building, 2nd Floor, Washington, DC 20590, with a copy sent to the Office of\nChief Counsel, PHMSA, at the same address, no later than 20 days after receipt of service of this\nFinal Order by Respondent. Any petition submitted must contain a statement of the issue(s) and\nmeet all other requirements of 49 C.F.R. § 190.243. The terms of the order, including corrective\naction, remain in effect unless the Associate Administrator, upon request, grants a stay.\nThe terms and conditions of this Final Order are effective upon service in accordance with 49\nC.F.R. § 190.5.\nNovember 20, 2019\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":20155}