{"operation":"document","citation":"CPF 520035002","title":"ALYESKA PIPELINE SERVICE CO — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2003-01-23","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.402(a), 195.412(a), 195.420(a), 195.567(c), 195.573(e), 195.575(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520035002.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520035002.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520035002","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520035002","body":"Notice of Probable Violation involving ALYESKA PIPELINE SERVICE CO. PHMSA's enforcement data identifies the cited regulations as 195.402(a),  195.412(a),  195.420(a),  195.567(c),  195.573(e),  195.575(a). The case was opened on 2003-01-23 and is reported as closed as of 2007-09-19. Proposed civil penalty: $18,500. Assessed civil penalty: $17,500. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520035002_decision on petition for reconsideration_03032006.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520035002/520035002_decision%20on%20petition%20for%20reconsideration_03032006.pdf\n\n520035002_decision on petition for reconsideration_03032006_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520035002/520035002_decision%20on%20petition%20for%20reconsideration_03032006_text.pdf\n\n520035002_final order_05192005.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520035002/520035002_final%20order_05192005.pdf\n\n520035002_final order_05192005_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520035002/520035002_final%20order_05192005_text.pdf\n\n520035002_petition for reconsideration_06152005.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520035002/520035002_petition%20for%20reconsideration_06152005.pdf\n\ncpf_520035002.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520035002/cpf_520035002.pdf\n\nCPF_NO5_2003_5002.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520035002/CPF_NO5_2003_5002.pdf\n\n520035002_final order_05192005_text.pdf\n\nU. S. Department\nof Transportation\nPipeline and\nHazardous Materials Safety\nAdministration\n400 Seventh Street, S. W.\nWashington, D C. 20590\nhtAY ) 3t\nMr. David Wight\nPresident and CEO\nAlyeska Pipeline Service Company\nP. O. Box 60469\nFairbanks, Alaska 99706\nRe: CPF No. 5-2003-5002\nDear Mr. Wight:\nEnclosed is the Final Order issued by the Associate Administr\nabove-referenced case. The Final Order makes findings of violation,\nto comply with the pipeline safety regulations and assesses a civil pen\nof the Final Order constitutes service of that document under 49 C. F.\nSincerely,\ntor for Pipeline Safety in the\nspecifies actions to be taken\nlty of $18, 500. Your receipt\n. 5 190. 5.\nJames Reynolds\nPipeline Compliance Re)\nOffice of Pipeline Safellr\n1stry\nEnclosure\ncc: Lee Schoen\nSheila Doody Bishop\nChris Hoidal, Regional Director\nWestern Region, OPS\nCERTIFIED MAIL - RETURN RECEIPT RE UESTED\n\n\n\nDEPARTMENT OF TRANSPORTATIO\nPIPELINE AND HAZARDOUS MATERIALS SAFETY\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, DC 20590\nMINISTRATION'\nIn the Matter of )\nAlyeska Pipehne Service Company, )\nRespondent\n)\n)\n)\n)\nC F No. 5-2003-5002\nFINAL ORDER\nFrom July 7-11, 2002, August 12-16, 2002, August 28-September 3,\n2002, representatives of the Office of Pipehne Safety (OPS), purs\nconducted on-site pipeline safety inspections of Respondent's facilities\nTrans Alaska Pipeline System (TAPS).\nAs a result of the inspections, the Director, Western Region, OPS, iss\ndated January 23, 2003, a Notice of Probable Violation, Propos\nCompliance Order and Notice of Amendment (Notice). In accordanc\nthe Notice proposed finding that Respondent had violated 49 C. F. R\n195. 575(a), 195. 571 and 195 573(a) and (e), proposed assessing a civil p\nof the alleged violations, and proposed that Respondent take certain m\nviolations. The Notice also proposed, in accordance with 49 C. F. R.\namend its procedures for Operations, Maintenance and Emergencies.\nOn February 3, 2003, Respondent requested an extension until April\nNotice, which the Regional Director granted on March 6, 2003. Respo\nto the Notice on April 28, 2003 (Response). Respondent conteste\n2002 and September 15-20,\nant to 49 U. S. C. ) 60117,\nmanuals and records on the\ned to Respondent, by letter\nd Civil Penalty, Proposed\nwith 49 C F. R. $ 190. 207,\n) )195. 420(a), 195. 567(c),\nnalty of $18, 500 for several\nasures to correct the alleged\n190. 237, that Respondent\n28, 2003 to respond to the\ndent submitted its response\nthe allegations, submitted\nThis case was initiated by the Office of Pipehne Safety in the Research\nAdministration (RSPA). However, this case is no longer before RSPA.\n2005, the Pipehne and Hazardous Materials Safety Administration (PHP\nfurther the highest degree of safety in pipeline transportation and hazard(\n0 a 1 AQ ~C'+L XT~~n~ V hEinotn Q~eonvr h anil\nlldllbpvll4HUll. Bee secllon j. vo vj. ILL lluluuul x . xvuxxvsu iivovuivii auiu\nImprovement Act (Pubhc Law 108-426, 118 Stat. 2423-2429 (Novembe\n70 Fed. R~e. 8299 (February 18, 2005) redelegating the pipeline safety\nAdministrator, PHMSA.\nd Special Programs\nEffective February 20,\nSA) was created to\nus materials\nnc ri sl Prnorvmc\n30, 2004)). See also,\nnctions to the\n\n\n\ndetailed information to explain the allegations and reserved the right o a hearing. A hearing was\nheld in the Western Region, OPS, on March 23, 2004. After the he ng, Respondent submitted a\nClosmg Response dated May 22, 2004.\nFINDINGS OF VIOLATION\nItem 4 in the Notice alleged that Respondent had violated 49 C. F. R. ) 195. 420(a) that requires an\noperator to maintain each valve that is necessary for the safe operation f its pipeline system in good\nworking order. The Notice alleged that Respondent had not maintaine the incoming and discharge\nvalves on Relief Tank No. 111 at PS01. The Notice more specifically al eged that on April 23, 2002,\nwhen Respondent was isolating Tank 111, Respondent found that bot the incoming and discharge\nvalves would not seal properly and that the valves were leaking int the tank. Because of the\nleakage, the Notice alleged that Respondent could not isolate the tank and complete the scheduled\ninternal inspection within the ten-year time frame required by API 65 .\nIn its Response Respondent contended that it took maintenance action o address the leaking valves\nand that extending the internal tank inspection to 2003 did not jeopar ize the integrity of the tank\nor of the system. Respondent maintained that it replaced the 20TO d 20T1 Tank 111 isolation\nvalves within a reasonable time considering the long lead (12-mo h) requirements, the short\nconstruction window (four months) on the north slope, and the stat of corrosion on the tanks\nRespondent further argued that during this period the operating risk w acceptable and the integrity\nof the pipeline was never compromised. Respondent explained that in arly 2002 it found the Tank\n111 isolation valves were leaking into the tank and installed stopples o the inlet and outlet hnes of\nthe tank, and in 2003 replaced the isolation valves. According to Resp ndent, the valve installation\nwas delayed because of the long lead time required for the 48-inch valv s, and, even with expedited\nservice, it took nine months, until February 2003, to get the new valv s.\nRespondent explained that after replacing the isolation valves on Tank 11, it inspected and repaired\nthe tank bottom. According to Respondent, API standard 653 provide that the inspection interval\nis determined by the corrosion rates measured during previous inspect'ons or anticipated corrosion\nrates based on experience with tanks in similar service, with a 20-year aximum inspection interval.\nRespondent's senior corrosion engineer determined that no significant orrosion would be expected\non the floor of Tank 111, and extending the internal inspection to 20 3 would not jeopardize the\nintegrity of the tank or system. Respondent mamtained that when it i spected the tank in 2003, its\nengineering analysis was verified.\nSection 195. 420(a) requires that each valve necessary for the safe oper tion of its system be in good\nworking order at all times. Although Respondent may have replaced t e valves within a reasonable\ntime frame, considering the circumstances that necessitated a 12-mont lead time for replacement,\nthe valves were noi in good working order at aH times. The leakino ~ alves were isolation valves,\nand due to their leaking, would not have worked properly to shut off th flow to Tank 111. Because\nthey were leaking, Respondent could not isolate Tank 111 to perform t e inspection. Although the\ncorrosion rate may have been slow enough that the integrity of the t floor was not impaired and\n\n\n\nthe tank inspection could be delayed a year, this does not alter the req\nto have been m good working order at all times. Accordingly, I find\n) 195. 420(a).\nirement that the valves were\nhat Respondent violated\nItem 5 alleged two violations. The first (Item 5(a)) was that Resp\nndent violated $ 195. 567(c)\nbecause at the Atigun Pass road crossing, from MP 165. 77 to MP 16\nl5. 8, a continuity test showed\nthat the casing test lead was directly shorted to the carrier pipe. The\notice alleged that without a\nhard wire connection to the casing, Respondent could not confirm th\nt the casing was electrically\nisolated from the carrier pipe The regulation requires that an operato\nmaintain the test lead wires\nin a condition that enables the operator to obtain electrical measuremen\ns to determine if the cathodic\nprotection meets criteria.\nItem 5's second allegation (Item 5{b)) was that Respondent had violate\nAtigun Pass road crossing, both the casing vent and settlement rod indi\nof-1. 25 volts. This reading suggested that the casing and/or casing test\nwith the carrier pipe and not electrically isolated. The regulation requi\nisolate each buried or submerged pipehne from other metallic struc\nelectrically interconnected and cathodically protected as a single unit.\n) 195. 575{a), because at the\nated a pipe-to-soil potential\nlead was in electrical contact\nes an operator to electrically\nures, unless the pipeline is\nRespondent agreed that the casing vent at the Atigun Pass road cr\nssing could be shorted and\nexplained that it planned to correct the potential shorting by the end o~\nf 2004, but no later than the\nend of 2005. Respondent argued that the existing state of corrosion\noes not represent an unsafe\ncondition and that the 2004-2005 time frame for repair is reasona\nle considering the state of\nc orrosl oil.\nRespondent's time frame for correcting the shorting is not at issue. Re\nthe casing and/or test lead may be shorted to the camer pipe; there\ncommitted both violations of )$ 195. 567(c) and 195. 575(a). Respon\ncondition will be addressed in the Compliance Order section.\npondent did not dispute that\nore, I find that Respondent\nent's actions to correct the\nItem 6 alleged four violations of ))195. 571 and 195. 573 (a)(1) and (e\nan operator to monitor external corrosion control to determine if cathocf\nwith one or more of the applicable criteria in NACE standard RP01\nspecified intervals and to correct any identified deficiency in corrosio\n. These regulations require\nic protection (CP) complies\n9-96 by conducting tests at\ncontrol.\nThe first allegation was that cathodic protection pipe-to-soil tests con\n12. 63 did not meet the CP criteria in NACE standard RP 0169-96 for th\nRespondent did not dispute the allegation but maintained it was makin\ntime frame. Respondent explained it had installed a continuous an\nnwwrrant PD rtrrtcarn in '7AAA 4)it that the rc«nnto nwuor cnnnlxr rlili nnf n\nVus+vuL Vx oposvuz us c vvv vugg ui a, uxv xviuvw yv vv vi vuyyig viv uvre, t\nplanned to install a new power generation and battery storage system in\nucted at MP 12. 31 and MP\nyears 2000, 2001 and 2002.\nthe repairs in a reasonable\nde (Anodeflex) impressed\n«fo««n Resnondent said it\n2003 orbytheendof2004.\n\n\n\nThe second allegation was that in 2001, based on the coupon test statio' survey, the coupon pipe-to-\nsoil potentials at seven locations did not meet either the -850mV or 1 OmV depolarization criteria\nin NACE standard RP 0169-96. Respondent did not dispute that th pipe-to-soil readings at the\nseven locations failed to meet the NACE criteria. Respondent presen ed information showing that\nin subsequent CP coupon testing in 2002, five of the seven locations met criteria, and in 2003, all\nthe coupons met the criteria.\nThe third ailegatton tn Item 6 was that based on the close interval stIrvey (CIS) Respondent had\nconducted in 2001, pipehne pipe-to-soil potentials at survey markers 0312+50 to 30321+00 (MP\n574. 1 to MP 574. 26) and 31195+50 to 31197+80(MP 590. 82 to 590. 8 ) did not meet the CP criteria\nin RP Standard 0169-96. The Notice further alleged that the mainlin corrosion control report for\nthe period ending December 31, 2000 indicated several areas o f low pi e-to-soil potentials between\nMP 574. 01-578. 01 and MP 590 82. Respondent did not dispute that t ere were low pipeline-to-soil\npotentials at these locations, but maintained that CIS data, by itsel, does not demonstrate the\nadequacy of CP. Respondent explained that it took action in 200 to adjust the Black Rapids\nrectifier and that all but one location now showed adequate cathodic rotection.\nI find that Respondent committed the three violations of ($195. 57) and 195. 573 (a)(1) and (e)\nconcerning deficiencies in its cathodic protection at the cited locati)ns. A close interval survey\n(CIS) gives a better condition of the cathodic protection (CP levels) $n the pipe. A coupon only\nmeasures the CP protection on a coupon, not on the pipe. HoweveI; a CIS &s similar to a prpe\nreading in that the CIS lead is connected to the pipe. The CIS is surveyed every foot along the pipe\ncompared with a pipe station that is located about every /g mile. Thus, CIS covers more of the pipe\nthan a test station or coupon. A CIS can confirm that CP potentials a e low.\nItem 6's fourth allegation was that Respondent had violated $)195. 571 and 195. 573 (a)(1) and (e)\nbecause at the Valdez Marine Terminal (VMT) the crude oil piping etween West Metering and\nBerth 4, and between Berths 4 and 5 did not meet the NACE cr teria for adequate cathodic\nprotection.\nRespondent did not dispute the allegation that the cathodic protectio was deficient on this piping\nbut maintained it had, nonetheless, demonstrated good faith in addressi g cathodic protection system\ndeficiencies. Respondent explained that the piping from West Mete 'ng to Berth 4 and between\nBerths 4 and 5 is protected by a single rectifier and the low cathodi protection is due to a poor\nrectifier and anode bed design. According to Respondent, piping rep ir projects have necessitated\nRespondent's turning off the rectifier to assure its workers' safety. Bec use of the short construction\nseason, cathodic protection testing is done when the rectifier is off or hen insufficiently polarized.\nRespondent discussed the cathodic protection system repairs it ha conducted to improve the\ncathodic protection.\nIn its Response and at the hearing, Respondent agreed that there wer deficiencies m the cathodic\nprotection on this piping. After submitting its Response and bef re the hearin, Respondent\nsubmitted a letter, dated June 25, 2003, to OPS maintaining that Res ondent now considered the\n\n\n\nVMT mani fold piping downstream of the breakout tank outlet pressur\ncontrolling device excluded\nfrom regulation. At the hearing Respondent again contended that OP\ndid not regulate this piping.\nRespondent maintained that the piping is terminal piping exclu\ned from regulation under\n(195. 1(b)(8)(ii) This provision excludes from regulation the trans\nortation of hazardous hquid\nthrough facihties located on the grounds of a materials transport\ntion terminal that are used\nexclusively to transfer oil between a non-pipeline mode (tank vessels)\nand a pipehne mode (except\nfor any device and associated pipehne necessary to control pressu\ne in the mainline pipeline).\nRespondent presented several interpretations by OPS addressing que\ntions about the regulation of\nin-plant and terminal piping and drawings used by the Transportation '\nSafety Institute (TSI), which\nRespondent argued approximated the VMT piping at issue.\nIn its after-hearing Statement, Respondent submitted a diagram of the piping at issue. Respondent\ncontinued to contend that the VMT piping was not regulated becaus it is used to transfer crude\nbetween the pipeline and the tankers.\nPart 195 excludes from its regulation transportation ofhazardous hqui through facihties located on\nthe grounds of a materials transportation terminal that are used excl sively to transfer hazardous\nhquid between non pipehne modes of transportation or between a non ipeline mode and a pipeline,\nnot including any device and associated piping that are necessary to c ntrol pipehne pressure. The\nOPS interpretations cited in Respondent's response provide that pipel e facihties at a terminal are\nregulated except for the pipmg used exclusively to transfer product froIn a storage or breakout tank\nto a non pipeline mode of transportation or between non pipeline mod~s of transportation. The TSI\ndiagrams illustrate this concept. However, the piping configuration t VMT is different from the\npiping described in the interpretations and illustrated in the TSI diagr ms. The VMT piping is not\nused exclusively as transfer piping. The 48-inch piping from MP 8 0 to the loading berths is a\ncontinuation of the mainline. The configuration is such that the tank could be bypassed and the\ncrude oil could flow directly from MP 800 to the berths. The piping se s mainline pressure because\nmainline pressure, i. e hydraulic head pressure, rather than pumps, is t e force that causes the oil to\nflow to the berths.\nThus, I find that the VMT piping at issue is regulated under Part 195. ince Respondent agreed that\nthe cathodic protection on the piping was low because of poor recti ier and anode bed design, I\nfather find that Respondent violated ) )195. 571 and 195. 573 (a)(1) and e). Respondent's corrective\nactions to increase the cathodic protection are discussed in the Compl ance Order section below.\nThese findings of violation will be considered prior offenses in any su sequent enforcement action\ntaken against Respondent.\nPENALTY ASSESSMENT\nUnder 49 U. S. C. ) 60122, Respondent is subject to a civil penalty ot to exceed $100, 000 per\nviolation for each day of the violation up to a maximum of $1, 000, 00 for any related series of\nviolations. The Notice proposed a total civil penalty of $18, 500 for t e violation of )) 195. 420(a)\n(Item 4), and the four violations of $$ 195. 571 and 195. 573(a) (1)(e) Items 6a, 6b, 6c and 6d)\n\n\n\n49 U. S. C. ) 60122 and 49 C. F. R $ 190. 225 require that, in determi ing the amount of the civil\npenalty, I consider the following criteria: nature, circumstances, and avity of the violation, degree\nof Respondent's culpabihty, history of Respondent's prior offenses, R)spondent's abihty to pay the\npenalty, good faith by Respondent in attempting to achieve complianc), the effect on Respondent's\nability to continue in business, and such other matters as ~ustice may quire.\nThe Notice proposed a civil penalty of $10, 000 for violation of 49 P. F. R. ) 195. 420(a) for not\nmaintainmg the incoming and discharge valves on Rehef Tank 111 at Pgmp Station 1. As mitigating\nfactors, Respondent offered that it had replaced the valves in a reasonable time frame, considering\nthe long lead time necessary to make such a repair, and that pipeline saf ty was not threatened during\nthe time as evidenced by the state of corrosion on the tanks. Res ondent added that the tank\nisolation valves have never been used to isolate the tanks in an emerg ncy situation.\nTank isolation valves are critical valves to the pipehne system, even if Respondent has not had to\nuse them in an emergency. Although Respondent has not had to use th valves in an emergency, an\nemergency is not the time to find they do not work. That is why they are to be maintained in good\nworking order at all times. But because they were leaking, the two valv s would not have functioned\nas they were intended to function. Respondent replaced the leaking v Ives, but this was necessary\nto have functioning valves. Mitigation is not warranted for aetio s to bring the valves into\ncomphance. Nor is mitigation warranted because the corrosion rate w s slow enough that the tank\ninspection could be delayed. Therefore, I assess a civil penalty of $1, 000 for this violation.\nThe Notice proposed civil penalties of $2000, $3500 and $2000 for t e three violations of\n)) 195. 571 and 195. 573 (a) and (e) for the cathodic protection defici ncies (Items 6a, 6b and 6c).\nRespondent asked that the penalty amounts be reconsidered. For tho e areas not corrected by the\n2003 testing, Respondent said it would take additional action to correc the low cathodic protection\nareas by installing a new impressed current remote power supply. Re pondent maintained it uses\nsound engineering practice to control corrosion through alternate me s, and its pig data shows the\nstate of corrosion does not threaten pipehne safety.\nMitigation is not warranted for taking corrective action to address he low cathodic protection\nreadings, and to bring them into compliance with one or more o the NACE criteria, as the\nregulations require. Some of the low cathodic protection readings e isted for at least three years\n(2000-2002). Respondent's use of in-line inspection tools to monitor c rrosion is prudent but is not\na substitute for restoring protection to required levels. Furthermore, R spondent's assertions about\nexamining pig data it had obtained since 1994 (locations cited in 6a) 1998 (locations cited in 6b\nand 6c) are unclear as to how these pig runs correspond to the period hen the areas did not meet\nthe NACE criteria. Although Respondent asserts that pipeline safety as not jeopardized, this was\nluck, not a reason for mitigation. The purpose of external monitorin for corrosion is not for an\n'+ be fore Iow cathodic nrotertion eadings result in corrosion\nin~urious to the pipeline. I assess $2, 000 for the low readings at the lo ations cited in 6a, $3500 for\nthe low readings at the locations cited in 6b, and $2000 for the low re dings at the locations cited\n111 6c.\n\n\n\nThe Notice proposed a civil penalty of $1, 000 for the violation of ))\n95. 571 and 195. 573 (a) and\n(e) for the cathodic protection deficiencies on the piping at the Valdez\nMarine Terminal (Item 6d).\nRespondent maintained that it demonstrated good faith in addressing\nhe CP system deficiencies.\nAlthough Respondent has tried to address the low cathodic protec\nion on the Valdez Marine\nTerminal piping, these actions to come into compliance with the r)\ngulations do not warrant a\nreduced civil penalty.\nAccordingly, having reviewed the record and considered the assessmentt criteria, I assess Respondent\na total civil penalty of $18, 500.\nPayment of the civil penalty must be made within 20 days of service. Federal regulations\n(49 C. F. R. ) 89. 21(b)(3)) require this payment be made by wire transfer, through the Federal Reserve\nCommunications System (Fedwire), to the account of the U. S. Treas . Detailed instructions are\ncontained in the enclosure. Questions concerning wire transfers sho ld be directed to: Financial\nOperations Division (AMZ-120), Federal Aviation Administration, ike Monroney Aeronautical\nCenter, P. O. Box 25082, Oklahoma City, OK 73125; (405) 954-8893.\nFailure to pay the $18, 500 civil penalty will result in accrual of interes at the current annual rate in\naccordance with 31 U. S. C. $ 3717, 31 C. F. R. $ 901. 9 and 49 C. F. R. $ 8 . 23. Pursuant to those same\nauthorities, a late penalty charge of six percent (6%) per annum will e charged if payment is not\nmade within 110 days of service. Furthermore, failure to pay the civil enalty may result in referral\nof the matter to the Attorney General for appropriate action in a Unite States District Court.\nWARNING ITEMS\nItem 1 in the Notice warned Respondent that it had not reviewed its elding manual WL-1 since\nMay 15, 1995. Section 195. 402(a) requires an operator to review it manual of procedures for\nconducting normal operations and maintenance each calendar year, a intervals not exceeding 15\nmonths. Respondent maintained that when it reviewed a document an did not make changes, the\nrevision date was not changed. Rather, the documents showing the eview were filed with the\ndocument management group.\nItem 2 warned Respondent that it was not following its procedures for eeping all rectifier data on\nwork done on the rectifiers in the rectifier cabinet. Respondent explai ed that the official record is\nkept in the pump station files, not at the rectifier box. Respondent s bmitted copies of the work\norder package for rectifier readings, which shows that the official fo is to be filed at the pump\nstation.\nRespondent must continue to ensure that it makes and documents the re\n1- --3 +1- a a t 1 va ~~r4 1ranvw'err we r nnewetnn1 uni'h 1tc Arnee\nlndlludlb dllV llldl LA dL luaL zw veau avvpulg io vvllOJOWLJI TT Lu\nwarned that if OPS finds a violation for any of these items in a subsequ\naction will be taken.\nuired reviews of each of its\ngrec 2 ecnnndent ic again\nnt inspection, enforcement\n\n\n\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to the items hs\n6a, 6b, 6c and 6d.\ned in the Notice as 4, Sa, Sb,\nFor violation of 49 C. F. R. $ 195. 412(a) (Item 4), the Notice propose\nsuction and discharge valves 20TO and 20T1 and complete an internal i\nIt will not be necessary to include this item in a comphance order beca\nthe isolation valves and made the inspection.\nthat Respondent repair the\nspection of relief Tank 111.\nse Respondent has replaced\nFor the two violations of $ ) 195. 567(c) and 195. 575(a) (Items Sa and\nRespondent evaluate the cathodic protection levels on the undergrou\nroad crossing and take appropriate action to bring the level of cathodi\nwith the criteria in NACE standard RP0169-96. Respondent maintain\nthe road crossmg ends to investigate and correct any potential shorting\nthe casing test lead. Respondent said it planned to correct the potentia\nor 2005 and until corrected would momtor corrosion using high\ntechnology The Region has verified that Respondent has excavated\nroad crossing. Therefore, there is no need to include this item in a co\nb), the Notice proposed that\nd piping at the Atigun Pass\nprotection into comphance\nd that it planned to excavate\nd problems associated with\nshorting by the end of 2004\nesolution inhne inspection\nd repaired the casing at the\npliance order.\nFor the three violations of $$ 195. 571 and 195. 573 (Items 6a, 6b and 6\nRespondent evaluate the cathodic protection levels at MP 12. 31, MP\n770. 66, 773. 78, 780. 61, 789. 49, 789. 84, MP 574. 1 to 574. 26 and\nappropriate action to bring the level of cathodic protection into comph\ncriteria in NACE standard RP0169-96, and add cathodic protection\n), the Notice proposed that\n12. 63, MP 754. 35, 760. 09,\nP 590. 82 to 590. 86, take\nce with at least one of the\nhere appropriate.\nIn response to 6a, Respondent said it would repair the power supply\npower generation and battery storage system The Region has confi\nnow working and that the cathodic protection levels are now adequat\nsubsequent testing in 2003 showed all coupons at issue (Locations 754.\n780 61, 789. 49, 789. 940) met the criteria. To address 6c, Respondent\nthe Black Rapids rectifier, which corrected the cathodic protection at a\npart of its Corrosion Monitoring and Mitigation and Capital Improve\nadditional action in 2004 to correct the areas with low readings. The\ncoupons at the cited locations now meet the NACE criteria. Because\nthe proposed corrective actions, they will not be included in the Comp\nn 2004 by instalhng a new\ned that the power supply is\nFor 6b Respondent said\n5, 760. 09, 770. 66. 773. 78,\naid that m 2003 it adjusted\n1 locations but one, and, as\nents Programs, would take\nRegion confirmed that the\nRespondent has carried out\niance Order.\nTo address 6d, Respondent said it was taking appropriate action althou\nh the VMT piping was not\nregulated under the pipehne safety regulations. As discussed in the Fin\nings section, this piping is\nrs mzl atr ri seal ac caar h maaet hsarra ariranaasto r sthnriin aarntrar tinn Thence\nhie iteavn nrin vravnnaaa iaa theaavyuausvu& uaau uo ouvua uauoe aauv v uuvatuuev vuuavuav iravevveavaa. a. aauo&\ns aaaS aevaaa vv ala avaaaalaa aaa aaav\nCompliance Order.\n\n\n\nUnder 49 U. S. C. ) 60118(a), each person who owns or operates a p\njpeline facility is required to\ncomply with the applicable safety standards established under chapter\n01 Pursuant to the authority\nof 49 U. S. C. $ 60118(b) and 49 C F. R. ( 190. 217, Respondent is\nhereby ordered to take the\nfollowing actions to ensure compliance with the pipehne safety\negulations applicable to its\noperations Respondent must—\n1 Evaluate the cathodic protection levels on the piping at the Val\nWest Metering and Berth 4 and between Berth 4 and Berth 5 a\nprotection into comphance with one or more of the apphcable c\nset forth in paragraphs 6. 2 and 6. 3 of NACE standard RPO16\n2 Submit documentation to the Western Regional Director de\nprotection deficiencies have been addressed.\n3 Complete the above-hsted items within 60 days from issuanc\nThe Regional Director may extend the period for complying with an\nRespondent requests an extension and adequately justifies the reason\nAMENDMENT OF PROCEDURES\nThe Notice (Item 3) alleged inadequacies in Respondent's Mainhn\nproposed that Respondent amend the procedures to require ground su\nsurveillance, to observe the conditions Respondent characterizes as n\nwith Vertical Support Members. The Notice alleged that some of the n\nbe seen by ground surveillance.\nRespondent disagreed that its procedures are inadequate and nee\nexplained that its manual defines notable conditions as those which c\nd~ng aerial inspection. Respondent contended that its weekly a\nrequirements of )195. 412, and that the regulation does not require gr\nSection 195. 412 requires an operator to inspect the surface conditions o\nright-of-way at specified intervals. The method of inspection is leA to\nis concerned that the aerial surveillance may not adequately assess the c\nVertical Support members, the record does not substantiate the necess\nits manual. The record does not support a finding that the procedures fo\ncombined with quarterly ground surveillance, and an annual line walk a\nthe conditions Respondent hsts as notable. Therefore, Respondent wil\n~wsa~A its hEninlw~n aiinrow11anra Vnaniinl nmr S iiiiVS'C\nlv Qillbilv iQ iYlciilliiiiv slii v viilullvv xllulluuL pvvvuvxvu\nez Marine Terminal between\nd bring the level of cathodic\n'teria for cathodic protection\n-96.\nonstrating that the cathodic\nof this Final Order.\nof the required items if the\nfor the extension.\nSurveillance Manual and\neillance, rather than aerial\ntable conditions associated\ntable conditions could only\namendment. Respondent\nbe qualitatively observed\n'al inspections exceed the\nund surveillance.\nor adjacent to each pipehne\nhe operator. Although OPS\nnditions associated with the\nty for Respondent to amend\nweekly aerial surveillance,\ne not adequate for assessing\nnot be required at this time\nFailure to comply with this Final Order may result in the assessmen of civil penalties of up to\n$100, 000 per violation per day, or in the referral of the case for judici I enforcement\n\n\n\n10\nUnder 49 C F. R. $ 190. 215, Respondent has a right to petition for\nOrder. The petition must be received within 20 days of Respondent's r\nmust contain a brief statement of the issue(s). The filing of the pet\npayment of any civil penalty assessed. All other terms of the order, incl\naction, remain m full effect unless the Associate Administrator, upo\nterms and conditions of this Final Order are effective upon receipt.\neconsideration of this Final\nceipt of this Final Order and\ntion automatically stays the\nding any required corrective\nrequest, grants a stay. The\nStacey Gerard\nAssociate Achninistrator\nfor Pipeline Safety\nDate Issued\n\n520035002_decision on petition for reconsideration_03032006_text.pdf\n\nOP ~)\nU. S. Department\nof Transportation\nPipeline and\nHmardous Materials Safety\nAdministration\n400 Seventh Street, S. W.\nWashtngton, D. C. 20590\nNH — 3 \"'0\nMr. David Wight\nPresident and CEO\nAlyeska Pipeline Service Company\nP. O. Box 60469\nFairbanks, Alaska 99706\ni4 '~QA ic, . gy\nRe: CPF No. 5-2003-5002\nDear Mr. Wight:\nEnclosed is a decision on the petition for reconsideration filed in the above-referenced\ncase. The Associate Administrator for Pipeline Safety has granted the petition regarding\nitem 6d in the Final Order. The civil penalty is reduced by $1, 000. Payment of the\nremaining $17, 500 civil penalty is due immediately. The Compliance Order portion of the\nFinal Order is amended by striking all portions related to item 6d. Please be advised that\nappropriate corrective action regarding the remainder of the Compliance Order and all\nWarning Items must be taken if such action has not already been completed. Your receipt\nof this decision constitutes service under 49 C. F. R. $ 190. 5.\nSincerely,\nJames Reynolds\nPipeline Compliance Registry\nOffice of Pipeline Safety\nEnclosure\nCERTIFIED MAIL — RETURN RECEIPT RE UKSTED\n\n\n\nDEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, DC 20590\nIn the Matter of\nAlyeska Pipeline Service Company,\nPetitioner\nCPF No. 5-2003-5002\nDECISION ON PETITION FOR RECONSIDERATION\nOn May 19, 2005, pursuant to 49 U. S. C. $ 60112, the Associate Administrator for\nPipeline Safety (Associate Administrator) issued a Final Order in this case finding that\nPetitioner had violated the pipeline safety regulations and assessing a civil penalty in the\namount of $18, 500. The Final Order also ordered Petitioner to take certain actions to\nensure compliance with the pipeline safety regulations. The Final Order warned\nPetitioner to take appropriate corrective action regarding some of Petitioner's practices\nfor recording data and reviewing documents.\nOn June 15, 2005, Petitioner filed a petition for reconsideration of the Final Order. ' In its\npetition, Petitioner sought reconsideration of one finding of violation in the Final Order,\non the grounds that the relevant piping was covered by the \"termmal facilities exception\"\nin 49 C. F. R $ 195 I (b)(8)(ii). Petitioner also complained the delay between the filing of\nPetitioner's response to the Notice of Probable Violation (NOPV) and the issuance of the\nFinal Order violated Pipeline and Hazardous Materials Safety Administration (PHMSA)\nregulations and Executive Order 12988.\nThe Final Order found Petitioner committed six violations of the pipeline safety\nregulations. Petitioner seeks reconsideration of the finding that Respondent violated\nsections 195. 571 and 195. 573(a)(1), (e) due to inadequate cathodic protection of crude oil\npiping between West Metering and Berth 4 and between Berths 4 and 5 at the Valdez\nMarine Terminal (VMT) (heremafter \"violation 6d\"). Petitioner also seeks a stay of the\nFinal Order with regard to violation 6d\n1 The petition for reconsideration mdicated Petitioner intended to brief the issues raised m the petition\nPHMSA did not receive a brief on the petition\n' Although Petitioner \"complained\" about the delay, Petitioner did not state what relief, if any, it sought\nPetitioner did not allege any pre~udice or harm resulting from the delay\n\n\n\nPetitioner argues that, unless violation 6d is withdrawn, the Final Order would\namend the terminal facilities exception by imposing size and pressure requirements\nas part of the exception. Petitioner claims the piping at issue in violation 6d is not\nwithin PHMSA's jurisdiction to regulate Petitioner further argues that, even if the\npiping is within PHMSA's statutory jurisdiction, it is not within the scope of the\ncurrent regulations and that PHMSA cannot now extend the scope of regulation to\ninclude this piping without notice and comment rulemaking.\nThrough delegations from the Secretary of Transportation, the Hazardous Liquid\nPipeline Safety Act of 1979 (\"HLPSA\") provides the authority for PHMSA to\nprescribe mmimum safety standards for pipeline transportation, which is \"the\nmovement of hazardous liquid by pipeline, or the storage of hazardous liquid\nincidental to the movement of hazardous liquid by pipeline, in or affecting interstate\n773\nor foreign commerce.\n\" Pipeline transportation \"does not include moving\nhazardous liquid through . . . onshore production, refining, or manufacturing\nfacihties; or storage or in-plant piping systems associated with onshore production,\nrefining, or manufacturing facilities. \"\nAccordingly, PHMSA's jurisdiction encompasses the movement of hazardous\nliquids by pipeline and the storage incidental to that movement. There is no\nquestion that the terminal facilities at the Valdez Marine Terminal are \"incidental\"\nto a pipeline. The facility is connected to a pipeline and receives hazardous liquids\ndirectly from a pipeline, making it incidental to pipeline transportation. See, e g,\nExxon v. U. S. Secretary of Transportation, 978 F. Supp. 946, 950 (E. D. Wash.\n1997). Therefore, all piping at this terminal clearly falls within the statutory\ndefinition o f pipeline transportation. 5\nAs noted by Petitioner, however, even if the piping is within PHMSA's statutory\njurisdiction, the piping may not fall within the area traditionally regulated by\nPHMSA. The plain language of the terminal facilities exception, found at\n49 C. F. R ) 195. 1(b)(8)(ii), states that Part 195 does not apply to transportation of a\nhazardous liquid through facilities located on the grounds of a materials\ntransportation terminal that are used exclusively to transfer the hazardous hquid\nbetween a non-pipeline mode and a pipeline. However, Part 195 does apply to \"any\ndevice and associated piping that are necessary to control pressure in the pipeline\nunder ) 195. 406(b)\" that would otherwise be excepted from Part 195 under the\nterminal facilities exception. 6\nSeveral pertinent facts are undisputed. Other than the piping associated with the\nbreakout tanks, no piping at the terminal facility is used to transport hazardous\nliquids out of the terminal by pipeline — all hazardous liquids leave the facility by a\nSee 49 U S C $ 60101(19) and (22)(A)\n49 U S C $ 60101(22)(B)(n) and (ni)\n5 The Valdez Manne Terminal facihties are not onshore production, refining, or manufacturing facihties, or\nstorage or in-plant piping systems associated with onshore production, refining, or manufacturing facdities\n49 C F R $ 195 1(b)(8)(n)\n\n\n\nnon-pipeline mode of transportation. Therefore, there is no question that the piping\nis on the grounds of a materials transportation terminal. It is also clear that\nhazardous liquids flow only from a pipeline to a non-pipeline mode of\ntransportation. At issue is whether the outlet piping from the storage tanks is\nnecessary to control pressure in the pipeline. 7\nThe terminal facihties exception finds its basis m the HLPSA. The HLPSA\nprovides that PHMSA does not have the authority to regulate storage facilities that\nare not incidental to pipeline transportation. PHMSA has declined to regulate any\nterminal facilities except those that are necessary to control the pressure in the\npipeline The fundamental basis of the terminal facilities exception is to exempt\nfrom regulation storage facilities. Facilities that are operationally part of the\npipehne and that are not part of storage have never been excepted from Part 195\nregulation.\nPetitioner argues that it does not use the piping to transport hazardous liquids\ndirectly to marine vessels, as described in the Final Order. Instead, Petitioner\nasserts that it only uses the piping to transfer hazardous liquids between storage\ntanks and non-pipeline modes of transportation. Petitioner argues that its ability to\nuse the piping as a continuation of the mainline does not affect its exclusive use as\ntransfer piping.\nAlthough I believe it was not the intent of the Office of Pipeline Safety to exempt\npiping under circumstances such as these, the piping between West Metering and\nBerth 4 and between Berths 4 and 5 at the Valdez Marine Terminal (VMT) falls\nwithin the language of the terminal facilities exception. The piping is not necessary\nto control pressure under section 195. 406(b). Therefore, the piping is n","truncated":true,"body_characters":42901}