{"operation":"document","citation":"CPF 520045015","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":"2004-04-28","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.571, 195.573(c).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520045015.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520045015.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520045015","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520045015","body":"Notice of Probable Violation involving ALYESKA PIPELINE SERVICE CO. PHMSA's enforcement data identifies the cited regulations as 195.571,  195.573(c). The case was opened on 2004-04-28 and is reported as closed as of 2010-03-10. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520045015_Final Order_09242007.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520045015/520045015_Final%20Order_09242007.pdf\n\n520045015_final order_09242007_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520045015/520045015_final%20order_09242007_text.pdf\n\n520045015_final order_09242007_text.pdf\n\no\nU S Department\nof Transportation\nPipeline and Hazardous\nMaterials Safety\nAdministration\ni200 New Jersey Ave S E\nWashington DC 20590\nSEP 24 20W\nBY CERTIFIED MAIL RETURN RECEIPT RE UESTED AND FACISIMILIE 907 450-5415\nMr. Rob Shoaf\nVice President, Regulatory Affairs\nAlyeska Pipeline Service Company\n900 East Benson Blvd\nAnchorage, AK 99507\nRe: CPF No. 5-2004-5015\nDear Mr. Shoaf:\nEnclosed is the Final Order issued by the Associate Administrator for Pipeline Safety in the\nabove-referenced case. It makes findings of violation and specifies actions to be taken to comply\nwith the pipeline safety regulations When the terms of the compliance order are completed, as\ndetermined by the Western Region Director, this enforcement action will be closed Your receipt\nof this Final Order constitutes service of that document under 49 C. F R. ) 190. 5\nSincerely,\nJames Reynolds\nPipeline Compliance Registry\nOffice of Pipelme Safety\ncc: Chris Hoidal, Director Western Region, PHMSA\nShelia Doody-Bishop, Esq. , Alyeska Pipelme Service Company\nEnclosure\n\n\n\nDEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D. C. 20590\n)\nIn the Matter of\nAlyeska Pipeline Service Company, )\nRespondent\n)\n)\n)\n)\nCPF No. 5-2004-5015\nFINAL ORDER\nFrom July 20 to 24, 2003, pursuant to 49 U. S. C. $ 60117, a representative of the Pipeline and\nHazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety, conducted an\non-site pipeline safety inspection of Respondent's Trans Alaska Pipeline System (TAPS)\nfacilities, manuals, and records for the portion of TAPS from Pump Station 12 to the Valdez\nMarine Terminal. As a result of the inspection, the Western Region Director issued to\nRespondent, by letter dated April 28, 2004, a Notice of Probable Violation, and Proposed\nCompliance Order (Notice). In accordance with 49 C. F, R. $ 190. 207, the Notice proposed\nfinding that Respondent had violated 49 C. F. R. )$ 195. 571 and 195. 573 and ordering\nRespondent to take certain measures to correct one of the alleged violations. The Notice also\nwarned Respondent to take appropriate corrective action to address the other probable violation\nin order to avoid future enforcement action.\nRespondent responded to the Notice by letter dated August 2, 2004 (Response) Respondent\ncontested the allegations, offered information in explanation of the allegations, and requested a\nhearing. A hearing was subsequently held on September 21, 2005, in Lakewood, Colorado.\nRespondent was afforded the opportunity to submit a post-hearing statement, and did so by letter\ndated November 18, 2005 (Closing).\n1 Effective February 20, 2005, the Pipelme and Hazardous Matenals Safety Admmistration (PHMSA) succeeded the\nResearch and Special Programs Administration as the agency responsible for regulating safety in pipehne and\nhazardous matenals transportation. See, section 108 of the Norman Y. Mmeta Research and Special Programs\nImprovement Act (Public Law 108-426, 118 Stat 2423-2429 (Nov 30, 2004)) See also, 70 Fed Reg. 8299 (Feb\n18, 2005) redelegating the pipelme safety authonties and functions to the PHMSA Administrator.\n\n\n\nFINDINC OF VIOLATION\nItem 2: Item 2 of the Notice alleged that Respondent violated 49 C. F. R. ) 195. 571, which\nstates:\n49 C. F. R. g 195. 571 — Cathodic protection required by this subpart must comply\nwith one or more of the applicable criteria and other considerations for cathodic\nprotection contained in paragraphs 6, 2 and 6. 3 of NACE Standard RP0169-96\n(incorporated by reference, see ) 195. 3).\nBack round\nItem 2 alleged that Respondent violated 49 C. F. R, ) 195. 571, by failing to provide adequate\ncathodic protection to portions of TAPS in 2002 and 2003. The Notice alleged that certain\nportions of TAPS did not meet the minimum criteria set forth in paragraph 6. 2 of NACE\nStandard RP0169-96 (NACE Standard), during tests of the pipeline's cathodic protection system.\nCathodic protection can limit corrosion on pipelines through the application of direct electric\ncurrent to the metal of the pipeline. Protection is achieved when current flows to the metal in an\namount sufficient to prevent the loss of metal from the pipeline to the surrounding environment.\nIf insufficient current is provided, metal can flow from the external surface of the pipeline and\ncorrosion can result. The NACE Standard provides a reference standard against which an\noperator can measure the flow of current to or from a pipeline (pipe-to-soil potential) Pipe-to-\nsoil potentials that do not meet the NACE Standard indicate that a pipeline is not receiving the\ncathodic protection required by $ 195. 571.\nPHMSA has found that corrosion causes a significant proportion of hazardous liquid pipeline\naccidents. As a result, in 2001, PHMSA incorporated the NACE Standard into the pipeline\nsafety regulations to reduce the potential for corrosion-related pipeline leaks. In order for\nRespondent to provide adequate cathodic protection for TAPS, it is essential that the company\nachieve and maintain full compliance with the NACE Standard.\nDuring the inspection, a PHMSA inspector found that Respondent's 2002 Close Interval Survey\n(CIS), as well as CIS data from 1998, 1999, and 2000, indicated that corrected pipe-to-soil\npotentials, measured between TAPS survey markers 42120+88 and 42149+59 (Mile Points (MP)\n797. 74 and 798. 28, respectively), did not meet the -850mV criteria in the NACE Standard. CIS\nis one of several methods used to measure pipe-to-soil potentials. A CIS is performed by\nmeasuring cathodic protection, on average, every foot along a section of pipeline. PHMSA\ninspectors also found that Respondent's 2002 and 2003 corrosion coupon test station readings\n' See also, \"Controlhng Corrosion on Hazardous Liquid and Carbon Dioxide Pipelines, Final Rule, \" 66 Fed Reg\n66, 994, 66, 998 (Dec 27, 2001) (\" The theory behmd final $195 571 is that if all external surfaces of a pipehne are\ncathodically protected accordmg to the criteria and other considerations m paragraphs 6 2 and 6 3 of the NACE\nStandard, external corrosion will be controlled successfully\" )\n' Fmal Rule, 66 FR 66, 994\nId\n\n\n\nfrom the MP 798. 57 coupon revealed pipeline pipe-to-soil potentials that did not comply with the\nNACE Standard. In each instance, the failure to meet pipe-to-soil potentials indicated that the\npipeline was not receiving adequate cathodic protection as required by $ 195. 571.\nIn its Response, at the Hearing and in its Closing, Respondent presented arguments in defense of\nPHMSA's allegation of violation and requested that the Notice be withdrawn, Respondent's\narguments and PHMSA's findings are discussed below.\nDiscussion and Findin s\n1. TheAde uac of Res ondent's Cathodic Protection S stem,\nRespondent did not dispute PHMSA's allegation that Respondent's CIS and coupon tests\nrevealed pipe-to-soil potentials below the minimum NACE criteria and acknowledged that\n6\nadditional corrective action was needed. Based on a review of the record in this case, and the\nundisputed fact that Respondent's 2002 CIS and 2002-2003 coupon data revealed pipe-to-soil\npotentials that did not meet minimum criteria, I find that Respondent's cathodic protection\nsystem did not provide the level of protection required by $ 195. 571.\n2. Corrosion Monitorin\nAlthough Respondent admitted that its cathodic protection system did not provide an adequate\nlevel of protection, Respondent contended in its Response that its use of In-Line Inspection (ILI)\ntools to momtor external corrosion constituted compliance with $ 195. 571. Specifically,\nRespondent contended that paragraph 6. 3 of the NACE Standard permitted it to use ILI instead\nof meeting the criteria for cathodic protection in paragraph 6. 2 of the NACE Standard $\n195. 571.\nI find Respondent's interpretation of ) 195. 571 incorrect for several reasons. Section 195. 571\nrequires that cathodic protection \"must comply with one or more of the applicable criteria and\nother considerations for cathodic protection found in the paragraphs 6. 2 and 6. 3 of NACE\nStandard RP0169-96\" (emphasis added). The use of the conjunctive \"an~' means that\nRespondent must provide adequate cathodic protection in accordance with paragraph 6. 2 criteria\nwhile also taking into account other considerations in paragraph 6. 3 of the NACE Standard. The\n\"other considerations\" indicate that respondent may use ILI as a supplemental diagnostic tool but\nthey do not permit Respondent to substitute ILI for compliance with the criteria set forth in\nparagraph 6. 2. '\n' Response, Probable Violanon 2 CathoCkc Protection at 2 (Aug. 2, 2004), Hearing Presentation, Issue ¹2 Cathodic\nProtection at 2 (Sept 21, 2005)\nResponse at 3\nResponse at 2-3\nResponse at 2\n49 C F R $ 195 571\n' See NACE RP 0169-96, Paragraphs 6 3 2 and 6 3 3 See Also, Final Rule 66 FR at 66, 998 Based on comments\nreceived, PHMSA specifically narrowed which NACE sections were to be incorporated mto 195 571 in order to\nprevent operators from \"deviat[tng] from the criteria and other considerations m section 6 \" Id\n\n\n\nRespondent's ILI program cannot replace the corrosion prevention function of an adequate\ncathodic protection system required by ) 195. 571. Cathodic protection, when adequate, serves\nas a continuous defense against external corrosion; whereas ILI serves only as a periodic\nassessment tool and indicator of external corrosion. Each method takes a different approach to\npipeline corrosion and each is independently necessary. Without adequate cathodic protection,\ncorrosion could occur undetected in the years between ILI tests and could cause a leak from\nRespondent's pipeline. I find that Respondent may not use ILI to see how long it can go before\ninadequate cathodic protection allows corrosion and damage the pipeline to occur and threaten\npublic safety and the environment. This Final Order marks the second time that PHMSA has\nrejected Respondent's argument that it may conduct ILI instead of maintaining an adequate\nll\ncathodic protection program.\n3. Corrosion Cpu Ons.\nAt the hearing, PHMSA expressed concern about Respondent's level of reliance on corrosion\ncoupons to monitor the effectiveness of its cathodic protection system. PHMSA noted the\npotential for corrosion occurring in sections of pipelme located between coupons in those years\nthat Respondent does not perform CIS. In its Closing, Respondent maintained that its reliance\non coupon data, supplemented by CIS to identify deteriorating trends in areas located between\ncoupons, is an effective means of monitoring the adequacy of its cathodic protection system. '\nHowever, Respondent does not perform CIS every year and could fail to detect corrosion not\nindicated by coupon monitoring.\nI find that coupon monitoring does not provide a comprehensive picture of corrosion trends\nalong a pipeline, particularly between coupons locations and in years when no CIS tests are\nperformed. In the rulemaking preamble to the final )195. 571, PHMSA stated that the use of\ncoupons alone to indicate the performance of a cathodic protection system \"has not always been\nsufficient to assure protection of all pipeline surfaces. \"' A CIS gives a better indication of the\ncathodic protection levels on the pipe because it measures, on average, every foot along the\npipeline, whereas coupon test stations are spaced, and only measure corrosion, about every half\nmile. Similarly, a coupon test measures corrosion of the coupon and not the pipe itself, whereas\na CIS takes measurements directly from the pipe. This finding is consistent with PHMSA's\nfindings in the previously cited Final Order issued against Respondent. '\nIn its Closing, Respondent also argued that PHMSA had approved Respondent's reliance on\ncoupons as an effective means of corrosion control, as part of a broader approval of its Corrosion\nControl Monitoring Plan (CCMP), as set forth in a letter from the Joint Pipeline Office (JPO),\ndated February 23, 2000, and signed by PHMSA. ' In fact, the letter did not approve the CCMP\nand expressly provided that only \"after acceptance of the final CCMP procedures\" would JPO,\n\" See In the Matter of Alyeska Pipehne Service Company, Final Order at 6, CPF No 5-2003-5002 (May 19, 2005)\n(finding that Respondent's use of ILI to momtor corrosion is not a substitute for restoring protection to required\nlevels) aff'd in part, Decision on Petition for Reconsideration (Mar 3, 2006)\nClosmg at 1-2.\n' Final Rule, 66 Fed Reg at 66, 999\n' In the Matter of Alyeska Pipeline Service Company, Fmal Order at 4, CPF No 5-2003-5002\n\" Closing at 2\n\n\n\nincluding PHMSA, accept the CCMP. PHMSA never accepted the final CCMP procedures and\nnever accepted the CCMP.\n4. Res ondent's cathodic rotection im rovements.\nAt the hearing and in its Closing, Respondent presented evidence of improvements that it had\nmade to its cathodic protection system after the inspection date, in support of its request that the\nNotice be withdrawn. One improvement was the 2004 isolation of the Petro Star refinery, located\nat MP 796, and the addition of an adjustable resistance bond to control loss of current to the\nrefinery. ' Respondent attempted to show another improvement by listing the results of the\n2005 coupon testin~ at MP 798, 57, which showed that the coupon met NACE corrosion\nprotection criteria. ' However, in its Closing, Respondent acknowledged that its 2005 CIS data\nindicated that none of the piIie-to-soil potentials measured between MP 797. 74 and 798. 28 met\nthe -850mV NACE criteria. Respondent explained that repairs to the nearby Valdez Marine\nTerminal required it to de-energize the cathodic protection systems and led to the inadequate\npipe-to-soil potentials measmed by CIS in 2005 and its failure to meet the NACE criteria.\nAlthough Respondent's 2005 coupon survey appeared to meet NACE criteria, it only serves as\nan indicator of corrosion at the location of the coupon and did not provide sufficient evidence of\nadequate cathodic protection. Information presented at the hearing and in the Closing show that\nRespondent's system continues to fail to provide adequate cathodic protection. ' As Respondent\nis aware, attempts to achieve compliance after an inspection do not warrant PHMSA's\nwithdrawal of violations.\nIn its Response, Respondent also stated that it would take additional corrective actions to its\ncathodic protection system by the end of 2006. Respondent contended that this would constitute\ncorrective action \"within a reasonable time, \" in accordance with 49 C. F. R. $ 195, 401(b). I\ndisagree. Respondent has been well aware of the inadequacy of its cathodic protection system\nfor several years and its failure to correct such condition within that time period does not\nconstitute correction \"within a reasonable time\" under $ 195. 401(b).\nS~ic\nAfter considering all of the evidence and legal issues presented, I find that Respondent has\nviolated $ 195. 571 as alleged in Item 2 of the Notice, for 2002 and 2003, because its cathodic\nprotection system did not comply with the applicable criteria for cathodic protection contained in\nparagraph 6. 2 of the NACE Standard. Because Respondent's system did not provide adequate\ncathodic protection, the risk of a corrosion-related pipeline accident and harm to the public,\nproperty and the environment was increased. Respondent's practice of ILI, while useful and\n' Hearmg Presentation at 5\n\"Id at 6-7.\n' Closing at 2,\n' See Hearing Presentation at 6, Closmg at 2,\n' See In the Matter of Alyeska Pipeline Service Company, Final Order at 6, CPF No 5-2003-5002 (finding that\n\"mitigation [of a proposed civil penalty] is not warranted for taking corrective action to address low cathodic\nprotection readings . ). Just as subsequent corrective action did not warrant mitigation of civil penalties in that case,\nit does not warrant withdrawal of the violation here\n\n\n\nnecessary to comply with other Part 195 pipeline inspection requirements, does not satisfy the\nrequirements of $ 195. 571. Additionally, the remedial efforts Respondent has made since the\ninspection have not been sufficient to provide adequate cathodic protection nor do these\nmeasures warrant withdrawal of the Notice. This finding of violation will be considered a prior\noffense in any subsequent enforcement action taken against Respondent. 21\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Item 2 for violation of 49 C. F. R.\n$ 195. 571. Under 49 U S. C. $ 60118(a), each person who engages in the transportation of\nhazardous liquids or who owns or operates a pipeline facility is required to comply with the\napplicable safety standards established under Chapter 601. Pursuant to the authority of 49\nU. S. C. ) 60118(b) and 49 C. F. R. ) 190. 217, Respondent is ordered to take the following actions\nto ensure compliance with the pipeline safety regulations applicable to its operations.\nRespondent shall:\n1. Within 30 days of receipt of this Order, submit for approval by the Western Region\nDirector a written plan (Plan) to bring cathodic protection levels between MP 797. 74 and\n798. 28 and in the vicinity of MP 798. 57 into compliance with one or more of the\napplicable criteria and other considerations for cathodic protection contained in\nparagraphs 6. 2 and 6. 3 of NACE Standard RP0169-96, as required by 49 C. F. R. $\n195, 571. The Plan shall provide for the addition of cathodic protection where necessary\nto meet one or more of the criteria m paragraph 6. 2 of the NACE Standard. The Plan\nshall also provide for continued Close Interval Surveys of the adequacy of cathodic\nprotection on TAPS, at the locations described above, to ensure cathodic protection is in\ncompliance with $ 195. 571. The Plan shall also provide a list and description of\nproposed remedial measures needed to bring the cathodic protection system into\ncompliance with $ 195. 571 and a schedule for completion of the remedial measures.\n2. Within 30 days of approval by the Western Region Director of the Plan described in\nParagraph one (1) above, bring the level of cathodic protection into compliance with one\nof the criteria in paragraph 6. 2 of the NACE Standard, as required by 49 C. F. R. $\n195. 571.\n3. Within 30 days of the addition of cathodic protection as required by Paragraphs one (1)\nand two (2) above, submit a written report to the Western Region Director demonstrating\nthat the cathodic protection deficiencies noted in this Final Order have been addressed in\naccordance with the approved Plan.\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 demonstrating good cause for an extension.\n\" As mentioned supra, PHMSA issued an earlier Fmal Order that re3ected Respondent's argument that ILI could\nsatisfy the NACE Standard imposed by $195 571 See In the Matter of Alyeska Pipeline Service Company, Fmal\nOrder at 6, CPF No 5-2003-5002 The earher Fmal Order was not been issued as of the date the Notice was issued\nin this case and therefore the violation of $ 195 571 cannot be deemed a prior offence\n\n\n\nWARNING ITEM\nWith respect to Item 1, the Notice alleged a probable violation of Part 195 but did not propose a\ncivil penalty or compliance order for this Item. Therefore, this is considered to be a Warning\nItem. The warning was for:\n49 C. F. R. ) 195. 573 — Respondent's failure to perform electrical checks for\nproper performance of the cathodic protection rectifier (20-EEA-116-1) located at\nRemote Gate Valve (RGV) 116 (MP 747. 2) from October 2, 2002, to June 17,\n2003. Electrical checks of this rectifier exceeded the 2'/2 month maximiun check\nfrequency required by 49 C. F. R. ( 195. 573(c).\nRespondent presented information in its Response showing that it had taken certain actions to\naddress this Item. Respondent contended that its failure to timely inspect the cathodic protection\nrectifier at RGV 116 was justified by safety concerns arising from unusually severe avalanche\nconditions during the winter of 2002-2003. As discussed during the hearing, Respondent could\nhave applied for a waiver of the time limits during the winter months or it could have provided\nfor the remote monitoringofrectifiers. In did neither. In its Closing, Respondent informed\nPHMSA that it was working to find effective alternatives for monitoring RGV rectifiers, In any\ncase, Respondent should immediately notify the Western Region Director whenever it fears that\nit will not be able to perform maintenance within required intervals.\nHaving considered such information, I find, pursuant to 49 C. F. R. ) 190. 205, that a probable\nviolation of 49 C. F. R. ) 195. 573(c) has occurred and Respondent is hereby advised to correct\nsuch condition. In the event that PHMSA finds a violation of this item in a subsequent\ninspection, Respondent may be subject to future enforcement action.\nIn accordance with 49 U. S. C. ) 60122 and 49 C. F. R. ) 190. 223, failure to comply with this Final\nOrder may result in the assessment of administrative civil penalties of not more than $100, 000\nper violation per day pursuant to 49 U. S. C. ( 60122, or in the imposition of civil judicial\npenalties and other appropriate relief pursuant to 49 U. S. C. $ 60120.\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 issues. The terms of the order, including\nany required corrective action, remain in full effect unless the Associate Administrator, upon\nrequest, grants a stay. The terms and conditions of this Final Order are effective on receipt.\nf-2+ o7\nDate Issued\nJeffrey D, Wiese\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":22427}