{"operation":"document","citation":"CPF 42023016NOPV","title":"DENBURY GREEN PIPELINE-TEXAS, LLC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2023-01-31","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.452(i)(1), 195.452(k).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-42023016nopv.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-42023016nopv.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-42023016nopv","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/42023016NOPV","body":"Notice of Probable Violation involving DENBURY GREEN PIPELINE-TEXAS, LLC. PHMSA's enforcement data identifies the cited regulations as 195.452(i)(1),  195.452(k). The case was opened on 2023-01-31 and is reported as closed as of 2023-12-18. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n42023016NOPV_Closure Letter_12182023_(21-199998).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42023016NOPV/42023016NOPV_Closure%20Letter_12182023_(21-199998).pdf\n\n42023016NOPV_Closure Letter_12182023_(21-199998)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/42023016NOPV/42023016NOPV_Closure%20Letter_12182023_(21-199998)_text.pdf\n\n42023016NOPV_Final Order_09252023_(21-199998).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42023016NOPV/42023016NOPV_Final%20Order_09252023_(21-199998).pdf\n\n42023016NOPV_Final Order_09252023_(21-199998)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/42023016NOPV/42023016NOPV_Final%20Order_09252023_(21-199998)_text.pdf\n\n42023016NOPV_Operator Response to Notice_03022023_(21-199998).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42023016NOPV/42023016NOPV_Operator%20Response%20to%20Notice_03022023_(21-199998).pdf\n\n42023016NOPV_PCO_01312023_(21-199998).pdf: https://primis.phmsa.dot.gov/enforcement-documents/42023016NOPV/42023016NOPV_PCO_01312023_(21-199998).pdf\n\n42023016NOPV_PCO_01312023_(21-199998)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/42023016NOPV/42023016NOPV_PCO_01312023_(21-199998)_text.pdf\n\n42023016NOPV_Final Order_09252023_(21-199998)_text.pdf\n\nSeptember 25, 2023\nVIA ELECTRONIC MAIL TO: chris.kendall@denbury.com\nChris Kendall\nDirector, President, and Chief Executive Officer\nDenbury Inc.\n5851 Legacy Circle, Suite 1200\nPlano, Texas 75024\nRe: CPF No. 4-2023-016-NOPV\nDear Mr. Kendall:\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 Denbury Green Pipeline – Texas, LLC, a\nsubsidiary of Denbury Inc., to comply with the pipeline safety regulations. When the terms of\nthe compliance order have been completed, as determined by the Director, Southwest Region,\nthis enforcement action will be closed. Service of the Final Order by e-mail is effective upon the\ndate of transmission and acknowledgement of receipt as 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. David Sheppard, Executive Vice President and Chief Operating Officer, Denbury\nInc., david.sheppard@denbury.com\nMr. Randy Robichaux, Vice President, Health, Safety and Environmental, Denbury\nOnshore, LLC, randy.robichaux@denbury.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)\n)\nDenbury Green Pipeline – Texas, LLC, a subsidiary of Denbury Inc., )\n)\nRespondent. )\n____________________________________)\n) CPF No. 4-2023-016-NOPV\nFINAL ORDER\nFrom February 23, 2021, through July 23, 2021, pursuant to 49 U.S.C. § 60117, representatives\nof the Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline\nSafety (OPS), conducted an on-site pipeline safety inspection of the facilities and records of\nDenbury Green Pipeline – Texas, LLC’s (Denbury or Respondent) carbon dioxide (CO2)\ntransmission pipeline system located in Texas. Respondent is a subsidiary of Denbury Inc.1\nAs a result of the inspection, the Director, Southwest Region, OPS (Director), issued to\nRespondent, by letter dated January 31, 2023, a Notice of Probable Violation and Proposed\nCompliance Order (Notice). In accordance with 49 C.F.R. § 190.207, the Notice proposed\nfinding that Denbury had committed two violations of 49 C.F.R. Part 195 and proposed ordering\nRespondent to take certain measures to correct the alleged violations.\nDenbury Onshore, LLC, another subsidiary of Denbury Inc., responded to the Notice by letter\ndated March 2, 2023, (Response) on behalf of Respondent and contested one of the allegations.\nRespondent did not request a hearing and therefore has waived its right to one.\nFINDINGS 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. § 195.452(i)(1), which states:\n1 US SEC Form 10-K, Denbury Inc., available at\nhttps://www.sec.gov/ix?doc=/Archives/edgar/data/945764/000094576423000028/den-20221231 htm (last accessed\nSeptember 6, 2023).\n\n\n\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) …\n(i) What preventative and mitigative measures must an operator take\nto protect the high consequence area? –\n(1) General requirements. An operator must take measures to prevent\nand mitigate the consequences of a pipeline failure that could affect a high\nconsequence area. These measures include conducting a risk analysis of\nthe pipeline segment to identify additional actions to enhance public safety\nor environmental protection. Such actions may include, but are not limited\nto, implementing damage prevention best practices, better monitoring of\ncathodic protection where corrosion is a concern, establishing shorter\ninspection intervals, installing EFRDs on the pipeline segment, modifying\nthe systems that monitor pressure and detect leaks, providing additional\ntraining to personnel on response procedures, conducting drills with local\nemergency responders and adopting other management controls.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.452(i)(1) by failing to conduct a\nrisk analysis to identify additional actions to enhance public safety or environmental protection\nfor facilities that could affect a high consequence area (HCA). Specifically, the Notice alleged\nthat Denbury failed to conduct a risk analysis in 2019 for its Brazoria Station, Beaumont Pig\nLauncher and Receiver Station, OCI Beaumont Lateral, and Air Products Meter Station tie-in,\n2\nas required by its procedures.3\nIn its Response, Denbury did not deny it had failed to complete a risk analysis in 2019 but\nargued that it was not in violation of § 195.452(i)(1) because it “reviewed and considered\nadditional actions in 2021 as 49 C.F.R. 195.452(i) requires but decided that they were not\nneeded.”4 Denbury asserted that it conducted risk assessments on October 27, 2021, and\nNovember 2, 2021, and identified the potential additional preventative and mitigative measures\n(P&MM) of installing remoted mounted cameras and additional inspections as well as additional\ninternal coupon inspections of the OCI Beaumont Lateral Meter Site, but ultimately determined\nthat the current P&MM in place were sufficient and chose not to implement them.5 Denbury\naverred that as it had identified and considered additional P&MM it was not in violation of\n§ 195.452(i)(1).\nDenbury’s argument is very similar to another enforcement action with another of Denbury\nInc.’s subsidiaries alleging a violation of § 195.452(i)(1).6 In that case, PHMSA brought an\nenforcement action alleging the operator had violated § 195.452(i)(1) for failing to do a risk\n2 Denbury ceased operation of the Air Products Meter Station tie-in on October 1, 2019.\n3 Denbury’s procedures require it to conduct a risk analysis pursuant to § 195.452(i)(1) every five years. Prior to\n2021, the last risk analysis was conducted in 2014.\n4 Response, at 1.\n5 Id.\n6 Denbury Onshore, LLC, Final Order, CPF 4-2022-041-NOPV, 2023 WL 3884046 (April 28, 2023).\n\n\n\nanalysis in 2019 for five pipeline facilities in HCAs in accordance with its procedures.\n7 Like this\nproceeding, the operator did not dispute that it had failed to conduct a risk analysis every five\nyears as its procedures required, but argued that it was not in violation of the pipeline safety\nregulations because it had identified and rejected additional P&MM during a subsequent\nevaluation, concluding that the P&MM it had in place for the HCAs were sufficient.8 In that\nFinal Order, I determined the operator was in violation of § 195.452(i)(1), noting further how\ncompliance with this requirement is related to other critical elements of integrity management:\nUnder § 195.452(f)(6), identification of P&MM to protect the high consequence area (HCA) is an element of an\nintegrity management program (IMP). An operator must continually change this program to reflect operating\nexperience, conclusions drawn from results of the integrity assessments, other maintenance and surveillance\ndata, and evaluation of consequences of a failure on the HCA. Pursuant to § 195.452(j)(3), an operator must\ncontinually evaluate and assess pipeline integrity at intervals of five years, not to exceed 68 months. [The\noperator’s] own procedures establish a five-year interval for P&MM risk analysis. [The operator] complied with\nneither. An operator must follow their manual of written procedures 9\n.\nLikewise, here Denbury acknowledges it failed to follow its own procedures to conduct a risk\nanalysis as required by § 195.452(i)(1) in 2019. Respondent’s assertion that it is not in violation\nof the pipeline safety regulations because two years after it was due, it conducted an assessment\nand determined additional P&MM were not necessary is inconsistent with the requirements of\nthe pipeline safety regulations and Denbury’s integrity management procedures.\nAccordingly, after considering all of the evidence, I find that Respondent violated 49 C.F.R.\n§ 195.452(i)(1) by failing to conduct a risk analysis to identify additional actions to enhance\npublic safety or environmental protection for facilities that could affect an HCA in 2019.\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(k), which states:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) …\n(k) What methods to measure program effectiveness must be used? An\noperator’s program must include methods to measure whether the program\nis effective in assessing and evaluating the integrity of each pipeline\nsegment and in protecting the high consequence areas. See Appendix C of\nthis part for guidance on methods that can be used to evaluate a program’s\neffectiveness.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.452(k) by failing to measure the\neffectiveness of its integrity management program (IMP) in assessing and evaluating the\nintegrity of each pipeline segment and in protecting the HCAs. Specifically, the Notice alleged\nthat Denbury failed to conduct an annual integrity management performance measurement from\n2015 to 2020.\n7 Id.\n8 Id.\n9 Id, at 2-3.\n\n\n\nIn its Response, Denbury did not contest the alleged violation and agreed to perform the tasks\nrequired in the proposed compliance order.\nAccordingly, after considering all of the evidence, I find that Respondent violated 49 C.F.R.\n§ 195.452(k) by failing to measure the effectiveness of its IMP in HCAs.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Items 1 and 2 in the Notice for\nviolations of 49 C.F.R. §§ 195.452(i)(1) and 195.452(k), respectively. Under 49 U.S.C.\n§ 60118(a), each person who engages in the transportation of hazardous liquids or who owns or\noperates a pipeline facility is required to comply with the applicable safety standards established\nunder chapter 601.\nWith regard to the violation of § 195.452(i)(1) (Item 1), Respondent argued it had already\nprovided documentation complying with the terms of the proposed compliance order but would\nprovide them again to PHMSA as required by the proposed compliance order. Having reviewed\nthe record, I do not find confirmation that Respondent has previously provided the\ndocumentation to the Director. Additionally, in its recommendation submitted pursuant to\n§ 190.209(b)(7), the Region asserted it had not received the documents Denbury stated it had\nprovided. For these reasons, the Compliance Order is not modified.\nDenbury did not contest the compliance terms for Item 2.\nPursuant to the authority of 49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217, Respondent is\nordered to take the following actions to ensure compliance with the pipeline safety regulations\napplicable to its operations:\n1. With respect to the violation of § 195.452(i)(1) (Item 1), Respondent must\nconduct a comprehensive facility risk analysis for all facilities that could affect an\nHCA to identify P&MM to enhance public safety or environmental protection.\nDenbury must submit the comprehensive facility risk analysis report to the Director,\nSouthwest Region, PHMSA within 90 days of the issuance of the Final Order.\nDenbury must also provide its most recent list of all could-affect HCA facilities to the\nDirector, Southwest Region, within 90 days of the issuance of the Final Order.\n2. With respect to the violation of § 195.452(k) (Item 2), Respondent must measure\nwhether its IMP is effective in assessing and evaluating the integrity of each pipeline\nsegment and in protecting HCAs. Denbury must submit the IMP effectiveness review\nto the Director, Southwest Region, PHMSA within 60 days of the issuance of the\nFinal Order.\n\n\n\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.\nPHMSA requests that Respondent maintain documentation of the safety improvement costs\nassociated with fulfilling this Compliance Order and submit the total to the Director. It is\nrequested that these costs be reported in two categories: (1) total cost associated with\npreparation/revision of plans, procedures, studies, and analyses; and (2) total cost associated with\nreplacements, 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 (see 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. The written petition must be received no later than\n20 days after receipt of the Final Order by Respondent. Any petition submitted must contain a\nstatement of the issue(s) and meet all other requirements of 49 C.F.R. § 190.243. The terms of\nthe order, including corrective action, remain in effect unless the Associate Administrator, upon\nrequest, grants a stay.\nThe terms and conditions of this Final Order are effective upon service in accordance with 49\nC.F.R. § 190.5.\nSeptember 25, 2023\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety\n\n42023016NOPV_Closure Letter_12182023_(21-199998)_text.pdf\n\nVIA ELECTRONIC MAILTO: chris.kendall@denbury.com\nDecember 18, 2023\nChris Kendall\nDirector, President, and Chief Executive Officer\nDenbury Inc.\n5851 Legacy Circle, Suite 1200\nPlano, Texas 75024\nCPF 4-2023-016-NOPV\nDear Mr. Kendall:\nFrom February 23 to July 23, 2021, representatives of the Pipeline and Hazardous Materials\nSafety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code (U.S.C.),\ninspected Denbury Green Pipeline - Texas, LLC (Denbury) carbon dioxide transmission pipeline\nsystem in Texas. As a result of the inspection, Denbury was issued a Final Order (Order) in the\nabove-referenced case. This Order included a Compliance Order.\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","truncated":false,"body_characters":16827}