{"operation":"document","citation":"CPF 520035032","title":"CHEVRON PIPE LINE CO — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2003-12-11","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.452(b)(2), 195.452(c)(1), 195.452(c)(1)(i), 195.452(e)(1), 195.452(f)(1), 195.452(g)(3), 195.452(h)(1), 195.452(h)(2), 195.452(h)(4), 195.452(i)(1), 195.452(j)(5)(iii), 195.452(l)(ii).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520035032.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520035032.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520035032","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520035032","body":"Notice of Probable Violation involving CHEVRON PIPE LINE CO. PHMSA's enforcement data identifies the cited regulations as 195.452(b)(2),  195.452(c)(1),  195.452(c)(1)(i),  195.452(e)(1),  195.452(f)(1),  195.452(g)(3),  195.452(h)(1),  195.452(h)(2),  195.452(h)(4),  195.452(i)(1),  195.452(j)(5)(iii),  195.452(l)(ii). The case was opened on 2003-12-11 and is reported as closed as of 2009-06-26. Proposed civil penalty: $15,000. Assessed civil penalty: $15,000. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520035032_FinalOrder_06082009.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520035032/520035032_FinalOrder_06082009.pdf\n\n520035032_FinalOrder_06082009_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520035032/520035032_FinalOrder_06082009_text.pdf\n\n520035032_FinalOrder_06082009_text.pdf\n\nJUN 08 2009\nMs. Rebecca B. Roberts\nPresident\nChevron Pipe Line Company\n4800 Fournace Place\nBellaire, TX 77401\nRe: CPF No. 5-2003-5032\nDear Ms. Roberts:\nEnclosed is the Final Order issued in the above-referenced case. It makes findings of violation\nand assesses a civil penalty of $15,000. It also finds that you have completed the actions\nspecified in the Notice required to comply with the pipeline safety regulations, and that you have\naddressed the inadequacies in your procedures that were cited in the Notice of Amendment.\nThe penalty payment terms are set forth in the Final Order, and this enforcement action closes\nautomatically upon payment. Your receipt of the Final Order constitutes service of that\ndocument under 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nJeffrey D. Wiese\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Mr. Chris Hoidal, Director, Western Region, PHMSA\nCERTIFIED MAIL – RETURN RECEIPT REQUESTED [7005 1160 0001 0046 9563]\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 )\nChevron Pipe Line ) CPF No. 5-2003-5032\nCompany, )\n)\n)\n)\nRespondent. )\n______________________________)\nFINAL ORDER\nFrom February 3 to 7 and March 3 to 7, 2003, pursuant to 49 U.S.C. § 60117, representatives of\nthe Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety\n(OPS), and the State of Washington, acting as an interstate agent, and the State of Texas, acting\nas an intrastate agent, inspected the Integrity Management Plan (IMP) of the Chevron Pipe Line\nCompany (CPLC or Respondent), the owner and operator of an extensive network of oil\npipelines and facilities in the United States.\nFollowing that inspection, the Director, Western Region, OPS (Director), sent to CPLC, by letter\ndated December 11, 2003, a Notice of Probable Violation, Proposed Civil Penalty and\nCompliance Order, and Notice of Amendment (Notice). In accordance with 49 C.F.R.\n§ 190.207, the Notice proposed finding CPLC in violation of 49 C.F.R. § 194.452, assessing it a\ncivil penalty of $15,000, and ordering it to take certain corrective actions. The Notice also\nproposed, in accordance with 49 C.F.R. § 190.237, that CPLC amend its IMP.\nCPLC responded to the Notice by letter dated February 16, 2004 (Response).1\nIt provided\ndetailed information on each of the probable violations and requested that the proposed civil\npenalty be reduced from $15,000 to $5,000. The Director then sent CPLC a letter in reply, dated\nApril 6, 2004 (Reply). He stated, among other things, that CPLC’s Response did not adequately\naddress several of the deficiencies cited in the Notice and that further amendment of its IMP\nprocedures was still needed. Finally, in a supplemental response by letter dated May 10, 2004\n(Supplemental Response), CPLC provided additional information on the matters raised in the\nNotice and the Reply.\n1 On December 23, 2003, the Director extended the 30-day deadline for the filing of CPLC’s Response until\nFebruary 17, 2004.\n\n\n\n2\nCPLC has not requested a hearing, thereby waiving that right and authorizing the entry of this\nFinal Order.\nFINDINGS OF VIOLATION\nItem 4: The Notice alleged that CPLC violated 49 C.F.R. § 195.452(c)(1), which states:\n§ 195.452 Pipeline integrity management in high consequence areas.\n. . .\n(c) What must be in the baseline assessment plan? (1) An operator must\ninclude each of the following elements in its written baseline assessment plan:\n(i) The methods selected to assess the integrity of the line pipe. An\noperator must assess the integrity of the line pipe by any of the following\nmethods. The methods an operator selects to assess low frequency electric\nresistance welded pipe or lap welded pipe susceptible to longitudinal seam failure\nmust be capable of assessing seam integrity and of detecting corrosion and\ndeformation anomalies.\nThe Notice alleged that CPLC’s baseline assessment plan (BAP) did not include an adequate\nmethod for assessing the integrity of its pipeline system. Specifically, it stated that the two\ndevices CPLC used in performing that assessment, a Magnetic Flux Leakage (MFL) tool and a\nGeometry tool, would adequately detect the presence of corrosion and other deformation\nanomalies in line pipe of any type. However, it further stated that those tools would not be\ncapable, either individually or in tandem, of adequately assessing the seam integrity of pre-1970\nlow frequency electric resistance welded (LFERW) line pipe. The Notice, therefore, concluded\nthat CPLC had to either select another methodology for assessing the integrity of its pre-1970\nLFERW pipe or provide an engineering analysis showing that the segments constructed with that\npipe were not susceptible to seam failure. Respondent has not disputed any of these allegations.\nAccordingly, I find that, as alleged in Item 4 of the Notice, CPLC violated 49 C.F.R. §\n195.452(c)(i) by failing to properly assess the integrity of its pre-1970 LFERW segments of line\npipe.\nItem 8: The Notice alleged that CPLC violated 49 C.F.R. § 195.452(b)(2), which states:\n§ 195.452 Pipeline integrity management in high consequence areas.\n. . .\n(b) What program and practices must operators use to manage pipeline\nintegrity? Each operator of a pipeline covered by this section must:\n. . .\n(2) Include in the program an identification of each pipeline or pipeline\nsegment in the first column of the following table not later than the date in the\nsecond column:\nPipeline Date\nCategory 1 . . . . . . . . . . . Category 2 . . . . . . . . . . . Category 3 . . . . . . . . . . . December 31, 2001.\nNovember 18, 2002.\nDate the pipeline begins\noperation.\n\n\n\n3\nSpecifically, the Notice alleged that CPLC failed to identify in its IMP which segments of the\nCategory 3 Bridgeport-Chico Line would or could affect a high consequence area (HCA) before\nplacing that line in service. See 49 C.F.R. §§ 195.452(a) (defining the types of pipelines subject\nto HCA integrity management procedures), (a)(3) (defining Category 3 pipelines as those\n“constructed or converted after May 29, 2001”); see also 49 C.F.R. § 195.450 (defining high\nconsequence area for purposes of § 195.452). Respondent does not dispute that allegation.\nAccordingly, I find that, as alleged in Item 8 of the Notice, CPLC violated 49 C.F.R. §\n195.452(b)(2) by failing to identify in its IMP which segments of the Category 3 Bridgeport-\nChico Line would or could affect an HCA before placing that line in service.\nItem 11: The Notice alleged that CPLC violated 49 C.F.R. § 195.452(h)(4), which states, in\nrelevant part:\n§ 195.452 Pipeline integrity management in high consequence areas.\n. . .\n(h) What actions must an operator take to address integrity issues?. . .\n(4) Special requirements for scheduling remediation--(i) Immediate repair\nconditions. An operator's evaluation and remediation schedule must provide for\nimmediate repair conditions. To maintain safety, an operator must temporarily\nreduce the operating pressure or shut down the pipeline until the operator\ncompletes the repair of these conditions. An operator must calculate . . .\nSpecifically, the Notice alleged that, at the time of the OPS inspection, CPLC’s IMP did not\nprovide a timeframe for temporarily reducing the operating pressure of a pipeline after\ndiscovering an immediate repair condition. The Notice then stated that, in the fall of 2002, more\nthan 30 days elapsed between CPLC’s discovery of an immediate repair condition on the Salt\nLake Crude System, Hanna to Salt Lake segment, and its temporary reduction of the operating\npressure of that pipeline.\nCPLC’s Response to these allegations included a copy of its immediate repair procedures, and\nthose procedures, issued on December 18, 2003, include a timeframe for temporarily reducing\nthe operating pressure of a pipeline after discovering an immediate repair condition. It did not,\nhowever, dispute the allegations regarding the operation of the Hanna to Salt Lake segment in\nthe Fall of 2002.\nI find CPLC’s Response unpersuasive. The only evidence offered by Respondent are IMP\nprocedures issued a week after the Notice. That document does not rebut the allegation that the\nimmediate procedures at the time of the OPS inspection failed to include the required timeframe.\nIn addition, the allegation that Respondent did not timely reduce the operating pressure on the\nHanna to Salt Lake segment following the discovery of an immediate repair condition in the Fall\nof 2002 remains undisputed.\nAccordingly, I find that, as alleged in Item 11 of the Notice, CPLC violated 49 C.F.R.\n§ 195.452(h)(4) by failing to have an IMP that provided a timeframe for temporarily reducing the\noperating pressure of a pipeline after discovering an immediate repair condition. I also find that,\nas alleged in Item 11 of the Notice, CPLC violated 49 C.F.R. § 195.452(h)(4) by failing to timely\nreduce the operating pressure on the Hanna to Salt Lake segment following the discovery of an\nimmediate repair condition in the Fall of 2002.\n\n\n\n4\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nASSESSMENT OF PENALTY\n49 U.S.C. § 60122 and 49 C.F.R. § 190.225 require that, in determining the amount of the civil\npenalty, I consider the following criteria: the nature, circumstances, and gravity of the violation,\nincluding adverse impact on the environment; the degree of Respondent’s culpability; the history\nof Respondent’s prior offenses; the Respondent’s ability to pay the penalty and any effect that\nthe penalty may have on its ability to continue doing business; and the good faith of Respondent\nin attempting to comply with the pipeline safety regulations. In addition, I may consider the\neconomic benefit gained from the violation without any reduction because of subsequent\ndamages, and such other matters as justice may require.\nThe Notice proposed a total civil penalty of $15,000. That included a $5,000 penalty for Item 8,\nRespondent’s violation of 49 C.F.R. § 195.452(b)(2), and a $10,000 penalty for Item 11,\ncivil penalty amount, from $15,000 to $5,000, is warranted based on the information and other\nRespondent’s violation of 49 C.F.R. § 195.452(h)(4).2 CPLC argues that a reduction of the total\nevidence provided in its Response.\nI do not find CPLC’s argument persuasive. For instance, a $5,000 civil penalty for Item 8\nreflects the nature, circumstances, and gravity of CPLC’s violation of 49 C.F.R. § 195.452(b)(2).\nIndeed, it commenced operations on the recently-constructed Bridgeport-Chico Line without\nconsidering the applicability of Subpart F’s integrity management procedures, thereby creating\nan unjustifiable risk of a pipeline failure and of resulting harm to the public. CPLC also bears a\nhigh degree of culpability for that violation. It owns, or has an interest in, more than 12,000\nmiles of pipeline in the United States, making it one of the largest and, presumably, most\nknowledgeable operators in the country. Finally, CPLC has the ability to pay the penalty\namount. It is a subsidiary of a company that generated $214 billion in operating revenue in\n2007, ensuring that the modest civil penalty assessed in this case will not have any adverse affect\non its business operations.\nthe assessment criteria.\n3 I, therefore, find that a $5,000 civil penalty for Item 8 is justified by\nThe $10,000 civil penalty for Item 11 is also warranted. The regulation at issue applies to the\noperation of a pipeline known to be in need of immediate repair, a circumstance that poses an\nincreased risk of harm to the public. 49 C.F.R. § 195.452(h)(4). That magnifies the gravity of\nCPLC’s violation. In addition, the circumstances surrounding that violation are quite troubling.\nAccording to the evidence of record, CPLC did not have a written immediate repair procedure\nfor some period of time, and it continued to operate a pipeline in need of immediate repair, the\nHanna to Salt Lake segment of the Salt Lake Crude System, for more than a month without\nreducing its operating pressure. These facts, when combined with the business and financial\ninformation mentioned above, more than support the proposed penalty amount. I, therefore, find\nthat a $10,000 civil penalty for Item 11 is justified by the assessment criteria.\n2 The Notice originally proposed a $10,000 civil penalty for Item 14. However, in a March 12, 2004 letter, the\nDirector informed CPLC that the former assessment was made in error, and that the $10,000 civil penalty was\nactually being proposed for Item 11.\n3 http://www.chevron.com/documents/pdf/corporatefactsheet.pdf (accessed January 5, 2009).\n\n\n\n5\nIn sum, after carefully reviewing the entire record, considering Respondent’s arguments, and\nanalyzing the statutory assessment criteria, I find that CPLC has failed to present any factual or\nlegal grounds that justify a reduction in the proposed civil penalty amount. Accordingly, I assess\nRespondent a total civil penalty of $15,000.\nPAYMENT OF PENALTY\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\nReserve Communications System (Fedwire), to the account of the U.S. Treasury. Detailed\ninstructions are contained in the enclosure. Questions concerning wire transfers should be\ndirected to: Financial Operations Division (AMZ-341), Federal Aviation Administration, Mike\nMonroney Aeronautical Center, P.O. Box 25082, Oklahoma City, OK 73125; (405) 954-8893.\nFailure to pay the $15,000 civil penalty will result in accrual of interest at the current annual rate\nin accordance with 31 U.S.C. § 3717, 31 C.F.R. § 901.9 and 49 C.F.R. § 89.23. Pursuant to\nthose same authorities, a late penalty charge of six percent (6%) per annum will be charged if\npayment is not made within 110 days of service. Furthermore, failure to pay the civil penalty\nmay result in referral of the matter to the Attorney General for appropriate action in a United\nStates District Court.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Item 4 for Respondent’s violation of 49\nC.F.R. § 195.452(c)(1). Under 49 U.S.C. § 60118(a), each person who engages in the\ntransportation of gas or hazardous liquids or who owns or operates a pipeline facility is required\nto comply with the applicable safety standards established under chapter 601. The Director has\nindicated that Respondent has taken the following actions specified in the proposed compliance\norder:\nWith regard to Item 4, in March 2003 Respondent identified the segments of its pipeline\nsystem that contained Pre-1970 LFREW pipe and undertook appropriate action to assess\nthe integrity of that pipe.\nAccordingly, since Respondent has achieved compliance with respect to this violation, the\ncompliance terms are not included in this Order.\nAMENDMENT OF PROCEDURES\nThe Notice alleged inadequacies in Respondent’s IMP and proposed to require amendment of\nRespondent’s procedures to comply with the requirements of 49 C.F.R. § 195.452. However,\nRespondent submitted copies of its amended procedures in its Response and Supplemental\nResponse, and the Director has since reviewed those procedures. Accordingly, I find, based on\nthe results of that review, that Respondent’s original procedures as described in the Notice were\ninadequate to ensure safe operation of its pipeline system, but that Respondent has corrected the\nidentified inadequacies. No need exists to issue an order directing amendment.\n\n\n\n6\nWARNING ITEMS\nWith respect to Items 1, 2, 3, 5, 9, 10, 12, 15B, 15C, 15D, and 16A, the Notice alleged probable\nviolations of Part 195, but did not propose a civil penalty or compliance order for these items.\nTherefore, these are considered to be warning items. The warnings were for:\n49 C.F.R. § 195.452(g)(3) (Item 1) — CPLC allegedly did not incorporate all\navailable information, including local or field information, during the pipeline\nsegment identification process, but rather relied solely on National Pipeline\nMapping System data.\n49 C.F.R. § 195.452(f)(1) (Item 2) — CPLC allegedly did not consider facility\nrelease volumes from all pipeline segments, pump stations, or breakout tanks in\nits IMP.\n49 C.F.R. § 195.452(f)(1) (Item 5) —CPLC allegedly did not have a verifiable\nprocess for incorporating pipeline segments that could affect HCAs onto the so-\ncalled “Risk Screening Segments” of its BAP.\n49 C.F.R. § 195.452(c)(I)(A) (Item 9) — CPLC allegedly did not include in its\nIMP requirements for establishing the accuracy of inline inspection (ILI) tool runs\nor adequate specifications and expectations for ILI vendors.\n49 C.F.R. § 195.452(h)(1) (Item 10) — CPLC allegedly did not have a well-\ndefined IMP procedure for integrating ILI results with other pipeline data.\n49 C.F.R. § 195.452(h)(1) (Item 12) — CPLC allegedly did not include a\nprocedure in its IMP for distributing a status report on 60-day and 180-day repair\nconditions to key personnel.\n49 C.F.R. § 195.452(e)(1) (Item 15B) — CPLC allegedly did not follow its risk\nassessment process in evaluating the Salt Lake Products pipeline.\n49 C.F.R. § 195.452(e)(1) (Item 15C) — CPLC allegedly assigned the regulatory\nimpact cost a higher value than human impacts or environmental factors within its\nscenario evaluation risk dimensions.\n49 C.F.R. § 195.452(e)(1) (Item 15D) — CPLC allegedly did not include an\nevaluation of risk for facilities in the risk assessment section of its IMP.\n49 C.F.R. § 195.452(i)(1) (Item 16) — CPLC allegedly did not include in its IMP\nan appropriate time interval for performing an updated evaluation of its risk\nassessment and preventive and mitigative measures or a process for evaluating the\nefficacy and need for improvement in its leak detection systems.\nCPLC presented information in its Response indicating that it had taken certain actions to\naddress these warning items. Having considered that information, I find that probable violations\nof Part 195 had occurred as of the date of the inspection. CPLC is hereby advised to review and\n\n\n\n7\ncorrect such conditions. In the event OPS finds a violation of any of these items in a subsequent\ninspection, CPLC may be subject to future enforcement action.\nRIGHT TO PETITION FOR RECONSIDERATION\nUnder 49 C.F.R. § 190.215, Respondent has a right to submit a Petition for Reconsideration of\nthis Final Order. The petition must be received within 20 days of Respondent’s receipt of this\nFinal Order and must contain a brief statement of the issue(s). The filing of the petition\nautomatically stays the payment of any civil penalty assessed. However if Respondent submits\npayment for the civil penalty, the Final Order becomes the final administrative decision and the\nright to petition for reconsideration is waived. The terms and conditions of this Final Order are\neffective upon receipt.\n_________________________________ ______________________\nJeffrey D. Wiese Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":20013}