{"operation":"document","citation":"CPF 42022017NOPV","title":"DENBURY GULF COAST PIPELINES, LLC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2022-05-26","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.401(b)(1), 195.402(a), 195.402(c)(12), 195.402(e)(7), 195.408(a), 195.408(b), 195.412(a), 195.440(a), 195.440(b), 195.440(c), 195.440(d), 195.440(e), 195.440(f), 195.440(g), 195.440(h), 195.440(i), 195.452(a)(1), 195.452(a)(2), 195.452(a)(3), 195.452(d)(1), 195.452(f)(6), 195.452(i)(1), 195.452(i)(2), 195.52(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-42022017nopv.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-42022017nopv.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-42022017nopv","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/42022017NOPV","body":"Notice of Probable Violation involving DENBURY GULF COAST PIPELINES, LLC. PHMSA's enforcement data identifies the cited regulations as 195.401(b)(1),  195.402(a),  195.402(c)(12),  195.402(e)(7),  195.408(a),  195.408(b),  195.412(a),  195.440(a),  195.440(b),  195.440(c),  195.440(d),  195.440(e),  195.440(f),  195.440(g),  195.440(h),  195.440(i),  195.452(a)(1),  195.452(a)(2),  195.452(a)(3),  195.452(d)(1),  195.452(f)(6),  195.452(i)(1),  195.452(i)(2),  195.52(a). The case was opened on 2022-05-26 and is reported as closed as of 2024-01-29. Proposed civil penalty: $3,866,734. Assessed civil penalty: $2,868,100. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n42022017NOPV_Closure Letter_01292024_(20-176125).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_Closure%20Letter_01292024_(20-176125).pdf\n\n42022017NOPV_Closure Letter_01292024_(20-176125)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_Closure%20Letter_01292024_(20-176125)_text.pdf\n\n42022017NOPV_Consent Agreement and Order_03242023_(20-176125).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_Consent%20Agreement%20and%20Order_03242023_(20-176125).pdf\n\n42022017NOPV_Consent Agreement and Order_03242023_(20-176125)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_Consent%20Agreement%20and%20Order_03242023_(20-176125)_text.pdf\n\n42022017NOPV_Operator Response to Notice and Request for Hearing and Statement of Issues_07252022_(20-176125).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_Operator%20Response%20to%20Notice%20and%20Request%20for%20Hearing%20and%20Statement%20of%20Issues_07252022_(20-176125).pdf\n\n42022017NOPV_Operator Withdrawal of Request for Hearing_03272023_(20-176125).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_Operator%20Withdrawal%20of%20Request%20for%20Hearing_03272023_(20-176125).pdf\n\n42022017NOPV_PCO PCP_0526022_(20-176125).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_PCO%20PCP_0526022_(20-176125).pdf\n\n42022017NOPV_PCO PCP_0526022_(20-176125)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_PCO%20PCP_0526022_(20-176125)_text.pdf\n\n42022017NOPV_PHC Hearing Rescheduled_12222022_(20-176125).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_PHC%20Hearing%20Rescheduled_12222022_(20-176125).pdf\n\n42022017NOPV_PHC Hearing Rescheduled_12222022_(20-176125)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_PHC%20Hearing%20Rescheduled_12222022_(20-176125)_text.pdf\n\n42022017NOPV_PHC Hearing Scheduled_10122022_(20-176125).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_PHC%20Hearing%20Scheduled_10122022_(20-176125).pdf\n\n42022017NOPV_PHC Hearing Scheduled_10122022_(20-176125)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/42022017NOPV/42022017NOPV_PHC%20Hearing%20Scheduled_10122022_(20-176125)_text.pdf\n\n42022017NOPV_PHC Hearing Scheduled_10122022_(20-176125)_text.pdf\n\nOctober 12, 2022\nVIA ELECTRONIC MAIL TO: ghopkins@velaw.com and bryan.lethcoe@dot.gov\nMr. George C. Hopkins, Esq.\nCounsel for Denbury Gulf Coast Pipeline, LLC\nVinson & Elkins LLP\n2200 Pennsylvania Avenue, NW, Suite 500\nWashington, DC 20037\nMr. Bryan Lethcoe\nDirector, Southwest Region\nPipeline and Hazardous Materials Safety Administration\n8701 South Gessner Road, Suite 630\nHouston, Texas 77074\nRe: Notice of Hearing, Denbury Gulf Coast Pipeline, LLC\nCPF No. 4-2022-017-NOPV\nDear Mr. Hopkins and Mr. Lethcoe:\nIn accordance with 49 C.F.R. § 190.211, an informal hearing will be held regarding the Notice of\nProbable Violation, Proposed Civil Penalty, and Proposed Compliance Order issued by the Pipeline\nand Hazardous Materials Safety Administration in the above-referenced case. The hearing will take\nplace on January 18, 2023, beginning at 8:30 a.m. Central Time.\nThe hearing will take place at the PHMSA Southwest Region office, 8701 South Gessner Road,\nSuite 630, Houston, TX 77074. Upon arrival at the building, attendees will be required to present\nphoto identification to security personnel. A contact phone number for the day of the hearing is\n(713) 272-2859.\nAt least 10 calendar days prior to the hearing (or by January 9, 2022), both parties must submit and\nexchange any additional written materials they intend to present at the hearing and the name and\nemail address of each attendee. This information should be provided electronically. Materials not\nsubmitted by this date may be excluded.\n\n\n\nIf you have any questions, please do not hesitate to contact me.\nSincerely,\nLarry White\nPresiding Official\ncc: Mr. David Sheppard, Senior Vice President – Operations, Denbury Gulf Coast Pipeline,\nLLC, david.sheppard@denbury.com\nMr. Ian Curry, Esq., Counsel, Southwest Region, Office of Pipeline Safety,\nian.curry@dot.gov\n\n42022017NOPV_PHC Hearing Rescheduled_12222022_(20-176125)_text.pdf\n\nDate: December 22, 2022\nFrom: Larry White\nTo: File\nRe: Continuance of Hearing, Denbury Gulf Coast Pipeline, LLC\nCPF No. 4-2022-017-NOPV\nBy electronic mail dated December 22, 2022, Ian Curry, Counsel for OPS Southwest Region, and\nGeorge Hopkins, Counsel for Denbury Gulf Coast Pipeline, LLC submitted a joint request for a\ncontinuance of the hearing previously scheduled for January 18, 2023. The request explained that\nthe parties were moving forward with negotiation of a consent agreement to resolve the case which\nwould make a hearing unnecessary and the additional time was needed to conclude the negotiations.\nI granted the request for a continuance until March 29, 2023 which will be the new hearing date if\nresolution by consent agreement is not completed by that time.\n\n42022017NOPV_Closure Letter_01292024_(20-176125)_text.pdf\n\nVIA ELECTRONIC MAIL TO: chris.kendall@denbury.com\nJanuary 29, 2024\nChris Kendall\nDirector, President, and Chief Executive Officer\nDenbury Inc.\n5851 Legacy Circle, Suite 1200\nPlano, Texas 75024\nCPF 4-2022-017-NOPV\nDear Mr. Kendall:\nBy letter dated May 26, 2022, the Pipeline and Hazardous Materials Safety Administration, Office\nof Pipeline Safety, issued a Notice of Probable Violation, Proposed Civil Penalty, and Proposed\nCompliance Order to Denbury Gulf Coast Pipelines, LLC. On March 24, 2023, the allegations\nwere resolved in a Consent Agreement and Order, which required payment of a civil penalty and\ncertain corrective measures.\nBased on PHMSA’s review of the documentation Denbury provided, it has been determined that\nDenbury has 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,\nBryan Lethcoe\nDirector, Southwest Region, Office of Pipeline Safety\nPipeline and Hazardous Materials Safety Administration\ncc: David Sheppard, Executive Vice President – Chief Operating Officer,\ndavid.sheppard@denbury.com\nMr. Randy Robichaux, Vice President, Health, Safety and Environmental,\nrandy.robichaux@denbury.com\nChad Docekal, Regulatory Manager - Pipelines, chad.docekal@denbury.com\n\n42022017NOPV_Consent Agreement and Order_03242023_(20-176125)_text.pdf\n\nVIA ELECTRONIC MAIL TO: david.sheppard@denbury.com\nDavid E. Sheppard\nExecutive Vice President and Chief Operating Officer\nDenbury Gulf Coast Pipelines, LLC\n5851 Legacy Circle, Suite 1200\nPlano, Texas 75024\nRe: CPF No. 4-2022-017-NOPV\nDear Mr. Sheppard:\nEnclosed please find the Consent Order incorporating the terms of the Consent Agreement between\nthe Pipeline and Hazardous Materials Safety Administration (PHMSA) and Denbury Gulf Coast\nPipelines, LLC, which was executed on March 24, 2023. Service of the Consent Order and\nConsent Agreement by electronic mail is deemed effective upon the date of transmission and\nacknowledgment of receipt, or as otherwise provided 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: Mr. Bryan Lethcoe, Director, Southwest Region, Office of Pipeline Safety, PHMSA\nMr. George C. Hopkins, Counsel for Denbury Gulf Coast Pipelines, LLC, Vinson & Elkins,\nghopkins@velaw.com\nCONFIRMATION OF 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)\nDenbury Gulf Coast Pipelines, LLC, ) CPF No. 4-2022-017-NOPV\n)\nRespondent. )\n)\nCONSENT ORDER\nBy letter dated May 26, 2022, the Pipeline and Hazardous Materials Safety Administration, Office\nof Pipeline Safety, issued a Notice of Probable Violation, Proposed Civil Penalty, and Proposed\nCompliance Order (“Notice”) to Denbury Gulf Coast Pipelines, LLC (“Denbury”).\nOn July 25, 2022, pursuant to 49 C.F.R. § 190.208, Denbury responded to the Notice by submitting\na Request for Settlement Conference and Hearing, after which the parties engaged in settlement\ndiscussions that resulted in the Consent Agreement attached to this Consent Order (the “Order”)\nthat settles all of the allegations in the Notice.\nAccordingly, the Consent Agreement is hereby approved and incorporated by reference into this\nOrder. Denbury is hereby ordered to comply with the terms of the Consent Agreement, effective\nimmediately.\nPursuant to 49 U.S.C. § 60101, et seq., failure to comply with this Order may result in the\nassessment of civil penalties as set forth in 49 C.F.R. § 190.223.\nThe terms and conditions of this Order are effective upon service in accordance with 49 C.F.R.\n§ 190.5.\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety\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)\nDenbury Gulf Coast Pipelines, LLC, ) CPF No. 4-2022-017-NOPV\n)\nRespondent. )\n)\nCONSENT AGREEMENT\nOn May 26, 2022, pursuant to 49 C.F.R. § 190.207, the Pipeline and Hazardous Materials Safety\nAdministration (“PHMSA”), Office of Pipeline Safety (“OPS” or “Agency”), issued a Notice of\nProbable Violation, Proposed Civil Penalty, and Proposed Compliance Order (“Notice”) to\nDenbury Gulf Coast Pipelines, LLC (“Denbury” or “Respondent”). The Notice alleged that\nRespondent committed probable violations of 49 C.F.R. Part 195, proposed a civil penalty, and\nproposed certain actions be taken by Denbury. The claims in the Notice relate to a release of CO2\non February 22, 2020, from Denbury’s pipeline in the vicinity of Satartia, Mississippi including\nDenbury’s associated response and reporting related to the incident (the “Satartia Release”).\nAfter receiving an extension of time to respond, on July 25, 2022, Denbury responded to the Notice\nby timely submitting a Request for Settlement Conference and Hearing pursuant to 49 C.F.R. §\n190.208(a)(4). Settlement discussions were held virtually on August 10, August 19, and\nSeptember 22, 2022.\nAs a result of these settlement discussions, PHMSA and Denbury (collectively, the “Parties”)\nagreed that settlement of the Notice will avoid further administrative proceedings or litigation and\nwill serve the public interest by promoting safety and protection of the environment. Pursuant to\n49 C.F.R. Part 190, and upon consent and agreement of Denbury and PHMSA, the Parties hereby\nagree as follows:\nI. General Provisions\n1. Respondent acknowledges that it is the operator of a 111-mile CO2 pipeline that\nruns from Jackson Dome, Mississippi to Delhi, Louisiana (the “Delta Pipeline”) and that the Delta\nPipeline is subject to the jurisdiction of the federal pipeline safety laws, 49 U.S.C. § 60101, et seq.,\nincluding the regulations and administrative orders issued thereunder. For purposes of this\nConsent Agreement (“Agreement”), Respondent acknowledges that it received proper notice of\nPHMSA’s action in this proceeding and that the Notice states claims upon which relief may be\n\n\n\ngranted pursuant to 49 U.S.C. § 60101, et seq., including the regulations and orders issued\nthereunder.\n2. After Denbury returns this signed Agreement to PHMSA, the Agency’s\nrepresentative will present it to the Associate Administrator for Pipeline Safety, recommending\nthat the Associate Administrator adopt the terms of this Agreement by issuing an administrative\norder (“Consent Order” or “Order”) incorporating the terms of this Agreement. The terms of this\nAgreement constitute an offer of settlement until a Consent Order is issued by the Associate\nAdministrator.\n3. Respondent consents to the issuance of the Consent Order, and hereby waives any\nfurther procedural requirements with respect to its issuance. Respondent waives all rights to\ncontest the adequacy of notice, or the validity of the Consent Order or this Agreement, including\nall rights to administrative or judicial hearings or appeals, except as set forth herein. Respondent\nagrees to withdraw its request for an administrative hearing regarding the Notice.\n4. This Agreement shall apply to and be binding upon PHMSA, and upon Denbury,\nits officers, directors, and employees, and its successors, assigns, or other entities or persons\notherwise bound by law. Respondent agrees to provide a copy of this Agreement and any\nincorporated compliance orders and schedules to all of Denbury’s officers, employees, and agents\nwhose duties might reasonably include compliance with this Agreement.\n5. This Agreement constitutes the final, complete, and exclusive agreement and\nunderstanding between the Parties with respect to the settlement embodied in this Agreement.\nPHMSA acknowledges that the claims asserted in the Notice constitute all claims of probable\nviolations that it will assert against Denbury arising out of the Satartia Release. The Parties\nacknowledge that there are no representations, agreements, or understandings relating to settlement\nother than those expressly contained in this Agreement, except that the terms of this Agreement\nmay be construed by reference to the Notice.\n6. Nothing in this Agreement affects or relieves Respondent of its responsibility to\ncomply with all applicable requirements of the federal pipeline safety laws, 49 U.S.C. § 60101, et\nseq., and the regulations and orders issued thereunder. Nothing in this Agreement alters PHMSA’s\nright of access, entry, inspection, and information gathering or PHMSA’s authority to bring\nenforcement actions against Denbury pursuant to the federal pipeline safety laws, the regulations\nand orders issued thereunder, or any other provision of federal or state law except as otherwise\nresolved through this Consent Order.\n7. For all direct transfers of complete ownership or operating responsibility of the\nDelta Pipeline which occur while this Agreement is in effect, Denbury will provide a copy of this\nAgreement to the prospective transferee at least 30 days prior to such transfer. Denbury will\nprovide written notice of the transfer to the Director no later than 60 days after the transfer occurs,\nprovided, however, that nothing herein shall require Denbury to provide such notice to the Director\nin connection with financing or other commercial transactions involving the pipeline that include\nthe creation of secured interests.\n\n\n\n8. This Agreement does not waive or modify any federal, state, or local laws or\nregulations that are applicable to the Delta Pipeline. This Agreement is not a permit, or a\nmodification of any permit, under any federal, state, or local laws or regulations. Denbury remains\nresponsible for achieving and maintaining compliance with all applicable federal, state, and local\nlaws, regulations, and permits.\n9. This Agreement does not create rights in, or grant any cause of action to, any third\nparty that is not a party to this Agreement. The U.S. Department of Transportation is not liable\nfor any injuries or damages to persons or property arising from acts or omissions of Respondent\nor its officers, employees, or agents carrying out the work required by this Agreement. Denbury\nagrees to hold harmless the U.S. Department of Transportation, its officers, employees, agents,\nand representatives from any and all causes of action arising from any acts or omissions of\nRespondent or its contractors in carrying out any work required by this Agreement.\n10. Respondent does not admit to any of the alleged violations or risks identified in the\nNotice and has provided PHMSA a detailed response outlining its position. However, for the\npurposes of this Agreement, Respondent agrees to the findings of violation, and agrees to address\nthe alleged violations and risks identified in the Notice by completing the actions specified in\nSection VI of this Agreement (Compliance Requirements) and to abide by the terms of this\nAgreement.\n11. Except as set forth herein, this Agreement does not constitute a finding of violation\nof any federal law or regulation and may not be used in any civil proceeding of any kind as\nevidence or proof of any fact, fault or liability, or as evidence of a violation of any law, rule,\nregulation, or requirement, except in a proceeding to enforce the provisions of this Agreement or\nin future PHMSA enforcement actions. Respondent does not admit any allegation or conclusion\nin the Notice or this Agreement and Order, but agrees, for purposes of this Agreement and Order,\nto address the alleged risk conditions by completing the terms of this Agreement.\nII. Definitions\n12. The “Director” means the Director, Pipeline and Hazardous Materials Safety\nAdministration, Office of Pipeline Safety, Southwest Region. The Director’s address is 8701 S.\nGessner, Suite 630, Houston, TX 77074.\n13. The “Satartia Release” or “Failure” means the release of carbon dioxide that\noccurred on Denbury’s Delta Pipeline in the vicinity of Satartia, Mississippi, including Denbury’s\nassociated response, which Denbury reported to the National Response Center on February 22,\n2020.\nIII. Findings of Violations\n14. Item 2 of the Notice: With respect to Item 2, the Notice alleged a violation of 49\nC.F.R. § 195.401(b)(1), which Denbury contested. Denbury acknowledges that portions of its\npipeline, including the segment of the Delta Pipeline near the failure site, were subject to erosion\nand sloughing type geohazard risks but failed to recognize this particular geohazard and the\nassociated risk prior to the Satartia Release. Given this acknowledgment, PHMSA instead finds\nthat Denbury violated 49 C.F.R. § 195.402(c)(13) by failing to review its procedures for\n\n\n\nmonitoring and addressing geohazard risks to determine their effectiveness and by failing to\ncorrect deficiencies in the geohazard program. Due to the failure to recognize certain geohazard\nrisks, Denbury also failed to review and revise its procedures in order to ensure that they involved\ncomprehensive measures to detect and mitigate these geohazard risks. This finding of violation\nshall be considered by PHMSA as a prior offense in any future PHMSA enforcement action taken\nagainst Respondent.\n15. Item 3 of the Notice: With respect to Item 3, the Notice alleged a violation of 49\nC.F.R. § 195.402(c)(12) and (e)(7), which Denbury contested. PHMSA finds that Denbury\nviolated 49 C.F.R. § 195.402(c)(12) and (e)(7) by its failure to formally meet with the Tri-\nCommunity Volunteer Fire Department as part of its liaison efforts. Information from Denbury\ndemonstrates that Denbury met with relevant emergency responders at the Yazoo County level as\npart of its liaison efforts and Public Awareness program, but failed to meet formally with the Tri-\nCommunity Volunteer Fire Department because Denbury had not identified Satartia as a “could\naffect” High Consequence Area (“HCA”) for this segment. Although Denbury officials had\ninformal contacts with the head of the Fire Department, those contacts were not sufficient to advise\nand consult on all topics required to be addressed. This finding of violation shall be considered\nby PHMSA as a prior offense in any future PHMSA enforcement action taken against Respondent.\n16. Item 4 of the Notice: With respect to Item 4, the Notice alleged a violation of 49\nC.F.R. § 195.408, which Denbury contested. Notwithstanding Denbury’s objections and denial,\nPHMSA finds that Denbury violated 49 C.F.R. § 195.408 because it failed to establish\ncommunication with local fire, police, and other appropriate public officials during this emergency\ncondition. Denbury became aware of SCADA data suggesting a potential significant pressure drop\nand immediately dispatched Operations Personnel to confirm whether there was a release and to\nidentify its location. However, because the location of the release had not been confirmed or\nidentified, Denbury did not immediately reach out to the local responders and no external contact\nwith emergency responders occurred until Denbury staff were contacted by the local fire chief\napproximately 42 minutes after the SCADA indication. This finding of violation shall be\nconsidered by PHMSA as a prior offense in any future PHMSA enforcement action taken against\nRespondent.\n17. Item 5 of the Notice: With respect to Item 5, the Notice alleged a violation of 49\nC.F.R. § 195.412, which Denbury contested. Notwithstanding Denbury’s objections and denial,\nPHMSA finds that Denbury violated 49 C.F.R. § 195.412 by failing to conduct adequate right-of-\nway inspections. The aerial patrolling program failed to record in at least one location on the Delta\nPipeline the observation of a sloughing condition that reflected a potential geohazard condition\nthat should have been recorded and followed-up on. In the area where the pipeline rupture\noccurred, Denbury had not identified any conditions associated with geohazards that were visible\nin the right-of-way before the event but that were not recorded on the aerial patrolling reports.\nThis finding of violation shall be considered by PHMSA as a prior offense in any future PHMSA\nenforcement action taken against Respondent.\n18. Item 6 of the Notice: With respect to Item 6, the Notice alleged a violation of 49\nC.F.R. § 195.440, which Denbury contested. PHMSA finds that with respect to the Satartia area,\nDenbury violated 49 C.F.R. § 195.440 by failing to conduct the activities described in both its\nwritten operations and maintenance (O&M) plan and its Public Awareness and Damage Prevention\n\n\n\nProgram developed to comply with § 195.440 with respect to the town of Satartia. Specifically,\nthe events of February 22, 2020 showed that the earlier PHAST dispersion analysis was wrong\nand that the town of Satartia was a “could-affect” HCA and should have been included in\nDenbury’s Public Awareness and Damage Prevention Program. Denbury also had not chosen as\na discretionary matter to increase its buffer zone which it could have done under its policy,\nnotwithstanding the modeling that showed Satartia to be outside the expected impact zone. This\nfinding of violation shall be considered by PHMSA as a prior offense in any future PHMSA\nenforcement action taken against Respondent.\n19. Item 7 of the Notice: With respect to Item 7, the Notice alleged a violation of 49\nC.F.R. § 195.452(d), which Denbury contested. Denbury now considers Satartia as being in a\n“could affect” HCA because Denbury has reassessed all segments on all of its lines that are located\nwithin two miles of an HCA where the terrain creates a risk that a leak of carbon dioxide “could\naffect” an HCA by supplementing its air dispersion modeling with an overland spread analysis. In\nconsideration of Denbury’s agreement to the other findings of violation and remaining terms of\nthe agreement, PHMSA withdraws the alleged violation of § 195.452(d). However, Denbury\nagrees to perform the proposed Compliance Requirements for Item 7, as described below.\n20. Item 8 of the Notice: With respect to Item 8, the Notice alleged a violation of 49\nC.F.R. § 195.452(f)(6) and (i)(1), which Denbury contested. Notwithstanding Denbury’s\nobjections and denial, PHMSA finds that Denbury violated 49 C.F.R. § 195.452(f)(6) and (i)(1)\nby failing to conduct a risk analysis that evaluated geohazards and by failing to identify and take\npreventive and mitigative measures to address geohazard risks in all HCAs and “could affect”\nHCAs. This finding of violation shall be considered by PHMSA as a prior offense in any future\nPHMSA enforcement action taken against Respondent.\nIV. Civil Penalties\n21. Item 2 of the Notice: With respect to Item 2, the Notice proposed a civil penalty\nof $2,251,334. With respect to culpability, Denbury asserted that the comments from the District\nManager were not referring to geohazards at the failure location. Therefore, PHMSA finds it\nappropriate to reduce the culpability determination to “[t]he operator failed to comply with an\napplicable requirement.” Without admission, Respondent agrees to pay a reduced civil penalty of\n$1,935,300 for Item 2 of the Notice.\n22. Item 3 of the Notice: With respect to Item 3, the Notice proposed a civil penalty\nof $46,600. Without admission, Respondent agrees to pay a civil penalty of $46,600 for Item 3\nas proposed in the Notice.\n23. Item 4 of the Notice: With respect to Item 4, the Notice proposed a civil penalty\nof $46,600. Without admission, Respondent agrees to pay a civil penalty of $46,600 for Item 4 as\nproposed in the Notice.\n24. Item 5 of the Notice: With respect to Item 5, the Notice proposed a civil penalty\nof $46,600. Without admission, Respondent agrees to pay a civil penalty of $46,600 for Item 5 as\nproposed in the Notice.\n\n\n\n25. Item 6 of the Notice: With respect to Item 6, the Notice proposed a civil penalty\nof $46,600. Without admission, Respondent agrees to pay a civil penalty of $46,600 for Item 6\nas proposed in the Notice.\n26. Item 7 of the Notice: With respect to Item 7, the Notice proposed a civil penalty\nof $46,600. For the reasons set forth above, PHMSA withdraws the underlying allegation of\nviolation for this Item. As such, PHMSA also withdraws the civil penalty for Item 7 of the Notice.\n27. Item 8 of the Notice: With respect to Item 8, the Notice proposed a civil penalty\nof $1,382,400. With respect to gravity, PHMSA reduces the gravity of the violation from\n“increased the severity of an accident/incident” to “occurred within an HCA . . . .” in light of\ninformation presented that had Denbury conducted a geohazard risk analysis, it would not have\ndecreased the “severity” of the release. Without admission, Respondent agrees to pay a reduced\ncivil penalty of $746,400 for Item 8 of the Notice.\n28. Respondent agrees to pay an adjusted civil penalty amount of $2,868,100 within 20\ncalendar days of the Effective Date pursuant to the instructions PHMSA has provided for payment.\nV. Warning Item\n29. Item 1 of the Notice: With respect to Item 1 of the Notice, alleging a probable\nviolation of 49 C.F.R. § 195.52, this Item was issued as a warning item. Respondent accepts the\nwarning as alleged in the Notice.\nVI. Compliance Requirements\n30. Items 2 and 8 of the Notice: Denbury agrees to update its geohazard program to\naddress hazards on all of its pipelines as well as include preventative and mitigative measures to\nenhance public safety and safe operation of its pipeline system. The geohazard program must\ninclude substantive information regarding hazard identification on each pipeline, assessment,\nremediation, and hazard recognition training for employees responsible for identifying geohazard\nissues.\n31. Items 3 and 6 of the Notice: Utilizing the revised dispersion modeling calculations\nperformed following the Satartia Release and taking into account all newly identified HCAs or\n“could affect” HCAs pipeline segments, Denbury agrees to:\ni. Identify all federal, state, and local government organizations that may\nrespond to a pipeline emergency that were not formerly identified and included within\nDenbury’s liaison program and ensure that they are included within Denbury’s liaison\nactivities as specified in Denbury’s manual for operations pursuant to 49 C.F.R. §\n195.402(c)(12) and § 195.402(e)(7);\nii. Identify all federal, state, and local government organizations that may\nrespond to a pipeline emergency that were not formerly identified and included within\nDenbury’s Public Awareness program and ensure that they are included within Denbury’s\nPublic Awareness program as specified in Denbury’s manual for operations pursuant to 49\nC.F.R. § 195.440;\n\n\n\niii. Identify a comprehensive list of stakeholders for the Delta Pipeline and\nrevise its written procedure OMO 0232 Damage Prevention and Public Awareness Section\n3.3 Stakeholder Groups (Revised 2/12/2012);\niv. Meet with all federal, state, and local government organizations that may\nrespond to a pipeline emergency that were not formerly identified and included within\neither Denbury’s liaison program or Public Awareness program, or that were not on the\nprior list of stakeholders in Section 3.3 Stakeholder Groups, in each case to ensure that they\nare aware of the Delta Pipeline in their response areas and provide a copy of the district\narea emergency response procedures.\nv. Maintain documentation of its compliance with the requirements of\nparagraph 31 (i) through (iv) and submit such documentation to the Director; which shall\ninclude:\n(1) Record of invitation to each local responder;\n(2) Name and contact information (address, county, and phone\nnumbers);\n(3) Attendance sheet with signatures of those in attendance;\n(4) Procedures and other information covered/discussed;\n(5) Record of documents provided to attendees; and\n(6) Record of documents mailed/provided to non-attendees.\n32. Item 5 of the Notice: Denbury agrees to complete a review of its written procedure\nO&M 0215, Patrolling and Leak Detection, and, based on that review, to include within O&M\n0215 additional guidance for the identification of potential geohazard sites and the training of\npersonnel on the amended procedures.\n33. Items 7 and 8 of the Notice: Denbury agrees to update its dispersion model and\nbuffer zone assessment by employing a model that considers the characteristics of CO2 and the\neffects of the specific terrain surrounding the Delta Pipeline, including effects of both elevation\nchanges and channeling, upon the release of CO2 to the atmosphere. Additionally, Denbury agrees\nto assess the extent and coverage of potential vapor cloud releases by updating its dispersion model\nto allow for variable inputs relating to foreseeable weather and pipeline operating conditions.\nDenbury agrees to incorporate newly identified HCAs or “could affect” HCA pipeline segments\nin its Integrity Management Program and Public Awareness Program and conduct a baseline\nassessment. Denbury agrees to conduct a risk analysis and will identify additional preventive and\nmitigative measures to enhance public safety or environmental protection for all HCAs or “could\naffect” HCA pipeline segments.\n34. If PHMSA disputes either the sufficiency of Denbury’s measures or the adequacy\nof its documentation with respect to the requirements of paragraphs 30 through 33, the parties shall\n\n\n\nfirst informally attempt to resolve any disputes before engaging in dispute resolution according to\nparagraph 38. Unless PHMSA presents any dispute regarding the sufficiency of Denbury’s\nmeasures or the adequacy of its documentation with respect to the above paragraphs within 60\ndays, the Director will promptly confirm in writing to Denbury that the obligations in paragraphs\n30 through 33 are satisfied in accordance with paragraph 41.\n35. Denbury must complete item v in paragraph 31 within 60 days of the Effective\nDate. The Director will determine if such compliance requirement is adequate within 60 days after\nsubmission and timely fulfill its obligations pursuant to Section XI.\n36. Denbury agrees to maintain documentation of the safety improvement costs\nassociated with fulfilling this Compliance Order and submit the total to the Director. It is requested\nthat these costs be reported in two categories: 1) total cost associated with preparation/revision of\nplans, procedures, studies, and analyses, and 2) the total cost associated with replacements,\nadditions, and other changes to pipeline infrastructure.\nVII. Enforcement\n37. This Agreement is subject to all enforcement authorities available to PHMSA under\n49 U.S.C. § 60101, et seq., and 49 C.F.R. Part 190, including administrative civil penalties as\nspecified in 49 U.S.C. § 60122 and 49 C.F.R. § 190.223 (presently up to $239,142 per violation\nfor each day the violation continues) and referral of the case to the Attorney General for judicial\nenforcement, if PHMSA determines that Respondent is not complying with the terms of this\nAgreement in accordance with determinations made by the Director, or if appealed, in accordance\nwith decisions of the Associate Administrator. The maximum administrative civil penalty amounts\nare adjusted annually for inflation. See 49 C.F.R. § 190.223.\nVIII. Dispute Resolution\n38. The Director and Denbury will informally attempt to resolve any disputes arising\nunder this Agreement, including, but not limited to, any decision of the Director. If Denbury and\nthe Director are unable to informally resolve the dispute within 15 calendar days after the dispute\nis first raised, in writing, Denbury may submit a written request for a determination resolving the\ndispute from the Associate Administrator for Pipeline Safety. The written request for a\ndetermination must be provided to the Director, counsel for the Southwest Region, and to the\nAssociate Administrator no later than 10 calendar days after the 15-day deadline for informal\nresolution referenced in this paragraph. Along with its request, Denbury must provide the\nAssociate Administrator with all information Denbury believes is relevant to the dispute.\nDeterminations of the Associate Administrator under this paragraph constitute final Agency\naction. The existence of a dispute and PHMSA’s consideration of matters placed in dispute, will\nnot excuse, toll, or suspend any term or timeframe for completion of any work to be performed\nunder this Agreement during the pendency of the dispute resolution process, except as agreed upon\nby the Director or Associate Administrator in writing.\nIX. Effective Date\n39. The term “Effective Date,” as used herein, is the date on which the Consent Order\nis issued by the Associate Administrator, PHMSA, incorporating the terms of this Agreement.\n\n\n\nX. Modification\n40. The terms of this Agreement may be modified by mutual agreement of the Parties.\nSuch modifications must be in writing and signed by both parties.\nXI. Termination\n41. This Agreement will remain in effect until the Compliance Requirements in Section\nVI are satisfied, as reasonably and timely determined by the Director. The Consent Agreement\nshall not terminate until the Director confirms, in writing, that the Consent Agreement is\nterminated in accordance with this paragraph. Nothing in this Agreement prevents Respondent\nfrom completing any of the obligations earlier than the deadlines provided for in this Agreement\nor seeking dispute resolution regarding the question of whether the Compliance Requirements\nhave been satisfied.\nXII. Ratification\n42. The Parties’ undersigned representatives certify that they are fully authorized to\nenter into the terms and conditions of this Agreement and to execute and legally bind such party\nto this document.\n43. The Parties hereby agree to all findings, conditions, and terms of this Agreement.\nFor Denbury Gulf Coast Pipelines, LLC:\n____________________________________\nDavid E. Sheppard\nExecutive Vice President and Chief Operating Officer\n____________________________________\nDate\nFor PHMSA:\n____________________________________\nBryan Lethcoe\nDirector, Southwest Region\n____________________________________\nDate","truncated":false,"body_characters":36048}