EL PASO ENERGY CORPORATION — Corrective Action Order

520031002h_corrective action order_04032003_text.pdf, page 1Official PDFUS, Department ot Transportation Itesecrth cad Special Ptogtonts loose en&n 5& sw 'wlshnplon D c jp59Q Mr. Tom Morgan Vice President of Operations El Paso Corporation 2 North Nevada Colorado Springs, CO 80903 Re: CPF No, 5-2003-1002H Dear Mr. Morgan: Enclosed is a Corrective Action Order issued by the Associate Administrator for Pipeline Safety in the above-referenced case. Lt requires you to take certain corrective actions with respect to the operation of your SB and SA lines &om the Cheyenne Compressor Station to the Watkins Compressor Station. Service is being made by certified mail and facsimile. Your receipt of the enclosed document constitutes service of that document. The terms and conditionsl of this Corrective Action Order are effective upon receipt. Smcerely, ~ &vendolyn M. Hi Pipeline Compliance Registry Office of Pipeline Safety Enclosure#

520031002h_corrective action order_04032003_text.pdf, page 2DEPARTMENT OF TRANSPORTATION RESEARCH AND SPECIAL PROGRAMS ADMINISTRATION OFFICE OF PIPELINE SAFETY WASHINGTON, DC 20590 In the Matter of El Paso Corporation, Respondent. CPF No. 5-2003-1002H This Corrective Action Order is bong issued, under authority of 49 U. S, C, ) 601 l 2, to require El Paso Corporation (Respondent) to take the necessary corrective action to protect the public and environment from potential hazards associated with a failure on kcspondciit's 24-inch and 22-inch natu% gas trmsniission hncs known as the 58 and SA hnes respectively from the Cheyenne Compressor Station (CS) to the Watkins CS. Pursuarit to 49 U. S, C. 5 60 ( 17, the Western Region, ONce of Pipeline Safety (OPS), iriitiatcd an investigation of the failure, Based on the information gathered during the investigation of the pipeline failure, 1 find that the operation of Respondent's "SB" 24-inch and "SA" 22-inch interstate natural gas transmission pipeline from Cheyenne CS to Watkins CS, withoutcorrective measures, would be hazardous to life, property and the environment. This finding is based on the following factual determinations: ~ On March 23, 2003, at approximately 7:50 p. m. Mountain Standard Time, Respondent's 24- inch diameter gas transmission pipeline "SB" ruptured at MilePost (MP) 54. 04. Thc escaping natural gas subsequently ignited. ~ ~ Respondent operates a parallel line, the 22-inch diameter "SA" linc, that attaches to the "SB" line with valved-cross-over lines. The SB and SA lines are normally operated as a single system, that is, there are cross-overs between the lines that are normally open to the flow of natural gas. The force of the rupture, blew an approximate 95 to 100 foot segment off the SB pipeline.#

520031002h_corrective action order_04032003_text.pdf, page 3The incident occurred in a rural area approximately 7 miles north of the town of Greeley in Weld County, Colorado. Thee persons &om three separate homes were evacuated. No fatalities or injuries werc rcportcd. No interruption of supply occurred. The pipeline rupture and subsequent fire damaged a house approximately 671 feet away from the north end of the failure site. A barn located approximately 761 feet from the north end of the failure site was undamaged. The fire burned an area approximately 600 feet in diameter. The 5B and 5A lines start at the Cheyenne CS, located approximately 10 miles south of Cheyenne, Wyoming, and continue south to the Watkins CS, which is located just east of Denver, Colorado. The right of way is approximately 81 miles long, with 73. 5 miles in Class 1, one mile in Class 2, and 6. 5 miles in Class 3. Thc failure site is in an area of farm land. The 5B line is buned approximately 12 feet underneath and perpendicular to County Road 72. The failure site is approximately 1/4 mile &om the intersection of County Road 72 and Highway 59. The failure site is approximately four miles south of the town of Eaton, Colorado. In 2000 Eaton had a population of 2, 690, according to the 2000 census, Both the 5B and 5A pipelines operate at a Maximum Allowable Operating Pressure(MAOP) of 850 psi. At the time of the explosion, the 5B pipeline was operating at about 814 psi. The failed pipe is high frequency Electric Resistance Weld pipe, API 5L X-60 with 0. 25-inch wall thickness, manufactured by Stupp. The fractured pipeline segment was mstalled in 1978. The segment of failed pipe is approximately 95 to 100 feet in length. The failure extended through a saddle weld on a 4-inch lateral connection at approximately thc three o' clock position (looking south) on the mainline 24-inch pipe. Preliminary examination of the failed pipe revealed no apparent internal or external corrosion nor any visible third party damage on the pipeline. The cause of the failure is unknown at this time. Respondent sent its metallurgist from Houston out to the site to get samples of the failed segment of pipeline for metallurgical testing. This incident appears to be similar to an incident that occurred on Respondent's "2B" 20- inch pipeline in the area downstream of Watkins CS on 12/20/1994. The 1995 metallurgical report from that incident indicates that an anomaly in thc pipe at the toe of the saddle-weld accompanied with fatigue induced &om independent motion of the lateral from the mainline 20-inch pipe over an approximate twenty year time frame combmed to cause the saddle-weld to fail.#

520031002h_corrective action order_04032003_text.pdf, page 4AAer thc 1994 release Respondent uncovered and performed nondestructive testing of 12 hot tap saddle weld connections in the area of the release. Respondent reportedly found no anomalies. Respondent also examined approximately 112 connections associated with the saddle welds, such as blow~ff risers, crossover saddles and hot tap piping. Respondent found approximately 30 defects and repaired them, according to Respondent. Thc 4-inch lateral connection pipe, which was constructed around the same time as the 24- inch 5B lme, goes to a meter station that has been used only occasionally in the last seven years, according to Respondent. The 4-inch line and meter station were originally intended to supply gas to Colorado Public Service Company for distribution to the greater Greeley, Colorado area. Colorado Public Service Company, however, gets most of its gas from other sources. Respondent had closed the valves to the meter station, but had left the 4-inch line connection intact. Respondent has remotely operated valves, approximately 1 mile south of the release site, on both the A and B lines. AAer recognizing a pressure drop on its SCADA system, Respondent immediately shut off thc remotely operated valves and dispatched personnel to shut oH'the manually operated valves located approximately 9 miles north of the release site. Respondent has isolated approximately 9 miles of both 5B and SA lines since the rupture. El Paso Corporation has owned the 5B and 5A pipclines since a merger with Colorado Interstate Gas Company in 2001. Section 60112 of Title 49, United States Code, provides for the issuance of a Corrective Action Order, aAcr reasonable notice and the opportunity for a hearing, requiring corrective action, which may include the suspended or restricted usc of a pipeline facility, physical inspection, testing, repair, replacement, or other action as appropriate. The basis for making the determination that a pipeline facility is hazardous, requiring corrective action, is set forth both in the above referenced statute and 49 C, F. R. )190. 233. Section 60112, and the regulations promulgated thereunder, provides for the issuance of a Corrective Action Order without prior opportunity for notice and hearing upon a finding that failure to issue the Order expeditiously will result in likely serious harm to life, property or thc environment. In such cases, an opportunity for a hearing will be provided as soon as practicable aAer the issuance of the Order. AAer evaluating the foregoing preliminary findings of fact, I find that the continued operation of the pipeline without corrective measures would be hazardous to life, property and thc environment. Additionally, aAer considering the age of thc pipe and the method of manufacturing, suspected cause of the failure, the proximity of the pipeline to populated areas, public roads, and environmentally sensitive areas, and the size of the line, I find that a failure to issue expeditiously this Order, requiring immediate corrective action, would result in likely serious harm to hfe, property, and thc environment.#

520031002h_corrective action order_04032003_text.pdf, page 5Accordingly, this Corrective Action Order mandating needed immediate corrective action is issued without prior notice and opportunity for a hearing. The terms and conditions of this Order are effective upon receipt. Within 10 days of receipt of this Order, Respondent may request a hearing, to be held as soon as practicable, by notifying the Associate Administrator for Pipeline Safety in writing, delivered personally, by mail or by telecopy at (202) 366-4566. The hearing will be held in Denver, Colorado or Washington, DC, on a date that is mutually convenient to OPS and Respondent. After receiving and analyzing additional data in the course of this investigation, OPS may identify other corrective measures that need to be taken. In that event, Respondent will be notified of any additional measures required and amendment of this Order will bc considered. To the extent consistent with safety, Respondent will be afforded notice and an opportunity for a hearing prior to the imposition of any additional corrective measures. Pursuant to 49 U. S. C. ) 60112, I hereby order Respondent to immediately take the following corrective actions with respect to its 5B line &om thc Cheyenne CS to thc Watkins CS, and also with respect to its 5A line from the Cheyenne CS to the %atkins CS: 1. Immediately reduce the operating pressure in the 5B line by 20'/o of the operating pressure at the time of the March 23, 2003 incident, which was 814 psig. At no time is the pressure to exceed 651 psig. 2. Conduct a detailed metallurgical analysis of the pipe that failed on March 23, 2003, to deteiminc the cause of failure and contributing factors. Submit an original copy of the report of this analysis to the Director, Western Region, OPS, within one week of your receipt of the report. 3. Create a written plan to expose and perform nonMcstructive~xamination {NDE) of each saddle weld reinforcement on the 5B line between the Cheycnnc CS and the Watkins CS. If any anomalous conditions are identified during the NDE process, initiate appropriate repairs or remove the saddle weld reinforcement. Submit a copy of the plan to thc Director, Western Region, OPS, for approval, before implementing the plan. 4. During the investigation of saddle weld reinforcements, document each step of the process in sufficient detail to be able to subsequently evaluate the results with thc purpose of identifying any trends in the data. 5. Continuously review NDE results toward identifying any trends, If a trend is identified, immediately notify the Director, Western Region, OPS, and modify the initial plan required in item ¹3 above to immediately investigate any and all appurtenances identified by the trend.#

520031002h_corrective action order_04032003_text.pdf, page 66. Once respondent has completed NDE ofsaddle weld connections and addressed any anomalous conditions identified on the 5B line, reduce the operating pressure on the 5A line by 20% aild initiate an immediate plan to expose and perform non-destructive-examination (NDE) of each saddle weld reinforcement on the 5A line between the Cheyenne CS and the Watkins CS. If any anomalous conditions are identified during the NDE process, initiate appropriate repairs or remove the saddle weld reinforcement. Submit a copy of the plan to the Director, Western Region, OPS, for approval, before implementing the plan. 7. Implementation of the plans required in items 3 and 6 above shall be completed within 180 days of the issuance of this corrective action order, 8. Within 30 days of the completion of the investigation on the SB and 5A line, Respondent must report the results to the Director, Western Region, OPS. At that time, a plan to address saddle weld reinforcements on the remainder of the CIG system will be discussed. 9. All pressure reductions required in this order will remain in place until the Respondent obtains written approval Irom the Director, Western Region, OPS, to return to normal operating pi'essures. 10. The Director, Western Region, OPS, may grant an extension of time for compliance with any of the terms of this order for good cause. A request for an extension must be in writing. The procedures for the issuance of this Order are described in Part 190, Title 49, Code of Federal Regulations, f 190. 233, a copy of which is enclosed, is made part of this Order and describe the Respondents' procedural rights relative to this Order. Failure to comply with this Order may result in the assessment of civil penalties of not more than $100, 000 per day for each day the violation persists up to a maximum $1, 000, 000 for any related series of violations, and in referral to the Attorney General for appropriate relief m United States District Court. APR -3 m3 Date Issued Stacey Gerard Associate Administrator for Pipeline Safety#