{"operation":"document","citation":"CPF 520045021","title":"ALON USA, LP — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2004-07-12","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.452(b)(5), 195.452(c)(1)(iii), 195.452(f)(1), 195.452(g)(4), 195.452(i)(3), 195.452(j)(1), 195.452(k), 195.452(l)(1)(ii).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520045021.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520045021.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520045021","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520045021","body":"Notice of Probable Violation involving ALON USA, LP. PHMSA's enforcement data identifies the cited regulations as 195.452(b)(5),  195.452(c)(1)(iii),  195.452(f)(1),  195.452(g)(4),  195.452(i)(3),  195.452(j)(1),  195.452(k),  195.452(l)(1)(ii). The case was opened on 2004-07-12 and is reported as closed as of 2009-12-10. Proposed civil penalty: $215,000. Assessed civil penalty: $200,000. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520045021_Decision on the Petition for Reconsideration_10222009.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520045021/520045021_Decision%20on%20the%20Petition%20for%20Reconsideration_10222009.pdf\n\n520045021_Decision on the Petition for Reconsideration_10222009_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520045021/520045021_Decision%20on%20the%20Petition%20for%20Reconsideration_10222009_text.pdf\n\n520045021_FinalOrder_08062009.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520045021/520045021_FinalOrder_08062009.pdf\n\n520045021_FinalOrder_08062009_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520045021/520045021_FinalOrder_08062009_text.pdf\n\n520045021_FinalOrder_08062009_text.pdf\n\nAUG 6 2009\nMr. Randy Hillman\nVice President of Pipelines\nGeneral Manager of Logistics and Utilities\nAlon USA, LP\nP.O. Box 1311\nBig Spring, TX 79721\nRE: CPF No. 5-2004-5021\nDear Mr. Hillman:\nEnclosed is the Final Order issued in the above-referenced case. It makes findings of violation\nand assesses a civil penalty of $200,000. When the civil penalty has been paid, as determined by\nthe Director, Western Region, PHMSA, this enforcement action will be closed. Your receipt of\nthe Final Order constitutes service of that document 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, Western Region Director, PHMSA\nCERTIFIED MAIL – RETURN RECEIPT REQUESTED [7005 0390 0005 6162 5647]\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\n______________________________\n)\nIn the Matter of )\n)\nAlon USA, LP, ) CPF No. 5-2004-5021\n)\nRespondent. )\n______________________________)\nFINAL ORDER\nFrom August 18 to 22, 2003, pursuant to 49 U.S.C. § 60117, representatives of the Pipeline and\nHazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),\nWestern, Central, and Southwest Regions, in conjunction with the Texas Railroad Commission\n(TRC), conducted an inspection of the pipeline Integrity Management Program (IMP) of Alon\nUSA, LP (Alon or Respondent), a company with crude oil refineries, pipeline facilities, and\nrefined-product marketing operations in several Western, Rocky Mountain, and Southwestern\nstates. This inspection, which occurred at the company’s refinery in Big Spring, Texas,1\nincluded a review of the company’s IMP program for the 1,265 miles (279 miles of interstate and\n986 miles of intrastate) pipelines that Alon was currently operating to transport crude oil and\nrefined-petroleum products.2\nAs a result of the August 2003 inspection, the Director, Western Region, OPS (Director), issued\nto Respondent, by letter dated July 12, 2004, a Notice of Probable Violation, Proposed Civil\nPenalty, and Proposed Compliance Order (Notice). In accordance with 49 C.F.R. § 190.207, the\nNotice proposed finding that Respondent committed various violations of 49 C.F.R. § 195.452,\nassessing Alon a civil penalty of $215,000 for 10 of the alleged violations, and ordering the\ncompany to take certain actions to comply with the IMP regulations.\nAlon responded to the Notice by letter dated August 11, 2004 (Response). It disputed nearly all\nof the violations, requested that the proposed civil penalty be reduced or eliminated, and argued\nthat the proposed compliance order was not necessary. Respondent did not request a hearing\nand, therefore, has waived its right to one.\n1 In February 2002, OPS and TRC conducted a prior joint inspection of Alon’s Big Spring refinery. See, In the\nMatter of Alon USA, C.P.F. 5-2002-5017 (Dec. 31, 2002).\n2 PHMSA’s records indicate that after the August 2003 OPS inspection, Holly Energy Partners acquired Alon’s\nonly interstate hazardous liquid pipeline system, the Trust-River System. Nonetheless, Alon’s 2008 annual report\nstates that Respondent still operates 42 miles of pipelines used for the transportation of petroleum and other refined\nproducts, that 21 miles of those pipelines are designated as segments that could affect High Consequence Areas\n(HCAs), and that an additional four miles of non-HCA pipelines are also used in the transportation of crude oil.\n\n\n\n2\nFINDINGS OF VIOLATION\nItem 1 of the Notice alleged that Alon violated 49 C.F.R. § 195.452(b)(2), which states:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) ….\n(b) What program and practices must operators use to manage\npipeline integrity? Each operator of a pipeline covered by this section\nmust:\n(1) ….\n(2) Include in the program an identification of each pipeline or\npipeline segment in the first column of the following table not later than\nthe date in the second column:\nPipeline Date\nCategory 1 December 31, 2001.\nCategory 2 November 18, 2002.\nCategory 3 Date the pipeline begins operation.\nThe Notice alleged that Alon violated 49 C.F.R. § 195.452(b)(2) by failing to identify all of the\ncovered segments in its pipeline system that could affect High Consequence Areas (HCAs)3 as of\nAugust 2003, the date of the OPS inspection.4 Specifically, the Notice alleged that the TRC had\npreviously cited Respondent for committing a similar violation of its intrastate regulations and\nthat OPS had ordered the company to amend its written segment-identification procedures in a\nDecember 31, 2002 Order Directing Amendment (ODA).\n5\nIt further alleged that Alon’s first\ncontractor (Contractor A) failed to complete the pipeline segment-identification process by\nDecember 31, 2001, the applicable deadline under the regulations; that Respondent was not\nusing the (albeit incomplete) results of Contractor A’s segment identification evaluation in its\ncurrent IMP; and that the company could not explain how Contractor A performed his segment-\nidentification evaluation or obtained his partial results. Finally, the Notice stated that Alon could\nnot verify the total mileage of interstate pipeline segments in its system that could affect HCAs.\n3 An HCA is defined for purposes of Part 195 as a “commercially navigable waterway, . . . [a] high population area,\n. . . [a]n other populated area, . . . [or] [a]n unusually sensitive area . . .” 49 C.F.R. § 195.450. A commercially\nnavigable waterway is “a waterway where a substantial likelihood of commercial navigation exists;” a high\npopulation area is “an urbanized area, as defined and delineated by the Census Bureau, that contains 50,000 or more\npeople and has a population density of at least 1,000 people per square mile;” an other populated area is “a place, as\ndefined by the Census Bureau, that contains a concentrated population, such as an incorporated or unincorporated\ncity, town, village, or other designated residential or commercial area;” id., and an unusually sensitive area is “a\ndrinking water or ecological resource area that is unusually sensitive to environmental damage from a hazardous\nliquid pipeline release.” 49 C.F.R. § 195.6.\n4 Given the total pipeline mileage operated by Alon and the installation date of the lines in question, the company\nhad an obligation under § 195.452(b)(2) to identify all of its pipeline segments that could affect HCAs on or before\nDecember 31, 2001. See 49 C.F.R. § 195.452(a)(1) (“Category 1 includes pipelines existing on May 29, 2001, that\nwere owned or operated by an operator who owned or operated a total of 500 or more miles of pipeline subject to\nthis part . . ”); see also 49 § C.F.R. 195.1(a)-(b) (defining scope of applicability of Part 195).\n5 In the Matter of Alon USA, C.P.F. 5-2002-5017 (Dec. 31, 2002).\n\n\n\n3\nRespondent disputed these allegations in its Response. Specifically, Alon argued that it had\nidentified all of its pipeline segments that could affect HCAs by December 27, 2001, four days\nbefore the applicable regulatory deadline. Respondent also argued that it was using the data\nderived from Contractor A’s segment identification evaluation in its IMP, and was augmenting\nthat data on the basis of a revised stream-and-waterway-transport methodology, developed by a\nsubsequent contractor (Contractor B). Alon further argued that a description of Contractor A’s\nsegment-identification methodology was on file with the company at the time of the OPS\ninspection but acknowledged that Contractor A could not provide a supporting rationale for that\nmethodology when requested. Finally, Respondent argued that it received an updated analysis of\nits HCA pipeline mileage, as well as other related data, on April 17, 2002, but that OPS rejected\nthat information as based upon Contractor A’s flawed methodology.\nRespondent’s arguments are not persuasive. The December 2002 ODA found that, as of\nFebruary 2002, the date of a prior OPS-TRCC joint inspection and some two months after the\ndeadline in § 195.452(b)(2) for identifying all could-affect HCA segments for Category 1\nin its Response in this proceeding that Contractor A could not provide a supporting rationale for\nhis methodology or reproduce his own results on request, and that “[a]t the time of the August[]\n2003 inspection,” Contractor B “had just completed the segment identification process using\nstream and waterway transport modeling.” Thus, there is no dispute that Alon’s written\nprocedures for performing the segment-identification process did not comply with the IMP\npipelines, Alon’s segment-identification procedures were still inadequate.6 Alon also admitted\nregulations as of December 31, 2001, thereby invalidating any evaluation actually conducted\npursuant to those procedures as of the 2001 deadline. Similarly, there is also no dispute that\nAlon’s new consultant, Contractor B, did not complete its subsequent segment-identification\nevaluation until well after that deadline. Accordingly, upon consideration of all of the evidence,\nI find that Respondent violated 49 C.F.R. § 195.452(b)(2) by failing to identify all of its pipeline\nsegments that could affect HCAs on or before December 31, 2001.\nItem 2 of the Notice alleged that Alon violated 49 C.F.R. §§ 195.452(b)(1) and (4)-(5), which\nstate:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) ….\n(b) What program and practices must operators use to manage\npipeline integrity? Each operator of a pipeline covered by this section\nmust:\n(1) Develop a written integrity management program that addresses\nthe risks on each segment of pipeline in the first column of the following\ntable not later than the date in the second column:\nPipeline Date\nCategory 1 March 31, 2002.\n6 OPS also notified Alon, by letter dated October 14, 2003, that the segment identification procedures reviewed\nduring the August 2003 inspection were not the same as the procedures it submitted several months earlier in\nresponse to the December 2002 ODA. The company responded to that letter by providing OPS with yet another\nversion of those procedures, dated November 11, 2003.\n\n\n\n4\n(2)\n(4) Include in the program a framework that--\n(i) Addresses each element of the integrity management program\nassessment and evaluation under paragraph (j) of this section;...\nunder paragraph (f) of this section, including continual integrity\n(5) Implement and follow the program.\nThe Notice alleged that Alon violated 49 C.F.R. §§ 195.452(b)(1) and (4)-(5) by failing to\ndevelop, implement, and follow a written IMP on or before the applicable deadline of March 31,\n2002, or by the date of the August 2003 inspection. Specifically, the Notice stated that Alon\nissued a draft IMP on August 13, 2003, less than one week before the OPS inspection, but that\nRespondent could not demonstrate, through adequate documentation, that it had adopted or\nimplemented a compliant IMP by March 31, 2002.\nAlon disputed these allegations in its Response. Specifically, Respondent argued that OPS\nactually reviewed the third edition of its IMP, not an early draft, during the August 2003\ninspection. Alon submitted three versions of its written IMP to support these assertions, dated\nFebruary 17, 2002, March 18, 2002, and August 13, 2003, respectively.\nThese arguments are not persuasive. In fact, the evidence submitted by Alon (i.e., the various\nto develop, implement, and follow a written IMP on or before March 31, 2002. With respect to\neditions of its IMP) only serves to confirm the allegations in the Notice. Alon had an obligation\ndevelopment, Respondent's February 17, 2002 IMP was clearly inadequate. That is reflected in\nthe findings of the December 2002 ODA and confirmed on further review in this proceeding.\nIndeed, the February 2002 IMP omits certain necessary information and admittedly relies in\nother instances on unverified information? Alon's March 18, 2002 IMP suffers from many of\nthese same inadequacies.\nIn addition to inadequate development of an IMP, there is also no evidence that Alon actually\nimplemented any version of it from March 31, 2002, the deadline for initially developing the\nprogram, until the date of the August 2003 OPS inspection? In fact, the OPS inspector noted in\nhis report from the August 2003 inspection that \"the first traceable iota of movement with\nrespect to Alon's [IMP] in the previous 16 months\" occurred when the company hired its new\n\" Response at Attachment 2.0, pp. 17-18, 20. For instance, under the subheading \"Evolving Risk Analysis\ncoefficients.\" Id. at 17. Similarly, under \"What are the risk factors for establishing an assessment schedule (for both\nCapabilities,\" the February 2002 IMP simply states \"*** Discuss linear model\" and **** Table of risk factor\nthe baseline and continual integrity assessments),\" it notes «***Discuss limitations,\" «***Discuss arbitrary selection\nmore complicated risk analysi[s.]\" Id. at 18. Finally, under the subheading for \"Computerized Records,\" the\nof parameters,\" «***Discuss confirmation of the risk model,\" \"Discuss model by risk analysis,\" and ****Discuss\nFebruary 2002 IMP twice states, in conjunction with a listed procedure, \"Confirm this is so.\" Id. at 20.\n& Response at Attachment 2.1, pp. 32 (notation to insert missing schedule for baseline evaluation), 56 (notation to\ninsert missing American Petroleum Institute Standard).\n' See 49 C.F.R. § 195.452(1) (requiring an operator to maintain records of \"actions taken ... to implement... each\nelement\" of an IMP).\n\n\n\n5\nconsultant some two weeks prior to that inspection. Accordingly, upon consideration of all of\nthe evidence, I find that Respondent violated 49 C.F.R. §§ 195.452(b)(1) and (4)-(5) by failing to\ndevelop an adequate written IMP on or before March 31, 2002, and to implement and follow an\nadequate written IMP from that date until the August 2003 OPS inspection.\nItem 3 of the Notice alleged that Alon violated 49 C.F.R. § 195.452(f)(2) and (c)(1), which\nstate, in relevant part:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . .\n(f) What are the elements of an integrity management program? An\nintegrity management program begins with the initial framework. An operator\nmust continually change the program to reflect operating experience, conclusions\ndrawn from results of the integrity assessments, and other maintenance and\nsurveillance data, and evaluation of consequences of a failure on the high\nconsequence area. An operator must include, at minimum, each of the following\nelements in its written integrity management program:\n(1) . . .\n(2) A baseline assessment plan meeting the requirements of paragraph (c)\nof this section . . .\nThe Notice alleged that Alon violated 49 C.F.R. § 195.452(f)(2) by failing to include a compliant\nBaseline Assessment Plan (BAP) in its IMP. Specifically, the Notice stated that Respondent\nlacked a BAP (or any of the information that must be included in one) at the time of the\ninspection. The Notice also stated that Alon’s personnel informed the OPS inspection team that\nthe development of its BAP could not be completed until its new consultant, Contractor B, had\nfinished the revised segment identification evaluation.\nAlon admitted in its Response that “[a]t the time of the August 2003 inspection, [it only] had a\nlimited documented [BAP],” and that it “couldn’t complete a fully documented risk[-]based\nconsideration of all of the evidence, I find that Respondent violated 49 C.F.R. § 195.452(f)(2) by\nassessment until the HCA identification analysis had been updated . . .”10 Accordingly, upon\nfailing to include a compliant BAP in its IMP as of the date of the OPS inspection.\nItems 4(a), (b), and (c) of the Notice alleged that Alon violated 49 C.F.R. § 195.452(e)(1) and\n(g)(1)-(4), which state, in relevant part:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . .\n(e) What are the risk factors for establishing an assessment schedule (for\nboth the baseline and continual integrity assessments)?\n(1) An operator must establish an integrity assessment schedule that\nprioritizes pipeline segments for assessment (see paragraphs (d)(1) and (j)(3) of\nthis section). An operator must base the assessment schedule on all risk factors\nthat reflect the risk conditions on the pipeline segment. The factors an operator\nmust consider include, but are not limited to:\n10 Response at 5.\n\n\n\n6\n(i) Results of the previous integrity assessment, defect type and size that\nthe assessment method can detect, and defect growth rate;\n(ii) Pipe size, material, manufacturing information, coating type and\ncondition, and seam type;\n(iii) Leak history, repair history and cathodic protection history;\n(iv) Product transported;\n(v) Operating stress level;\n(vi) Existing or projected activities in the area;\n(vii) Local environmental factors that could affect the pipeline (e.g.,\ncorrosivity of soil, subsidence, climatic);\n(viii) Geo-technical hazards; and\n(ix) Physical support of the segment such as by a cable suspension bridge.\n(2) . . .\n(g) What is an information analysis? In periodically evaluating the\nintegrity of each pipeline segment (paragraph (j) of this section), an operator must\nanalyze all available information about the integrity of the entire pipeline and the\nconsequences of a failure. This information includes:\n(1) Information critical to determining the potential for, and preventing,\ndamage due to excavation, including current and planned damage prevention\nactivities, and development or planned development along the pipeline segment;\n(2) Data gathered through the integrity assessment required under this\nsection;\n(3) Data gathered in conjunction with other inspections, tests, surveillance\nand patrols required by this Part, including, corrosion control monitoring and\ncathodic protection surveys; and\n(4) Information about how a failure would affect the high consequence\narea, such as location of the water intake.\nItem 4(a) of the Notice alleged that Alon violated 49 C.F.R. § 195.452(e)(1) and (g)(1)-\n(4) by failing to establish an integrity assessment schedule that prioritized its pipeline\nsegments for assessment on the basis of all risk factors and by failing to analyze all\navailable information about the integrity of its entire pipeline system and the\nconsequences of a failure. Specifically, the Notice alleged that Alon presented the OPS\ninspection team with a draft risk assessment method that had been copied verbatim from\na textbook. The Notice also alleged that the company provided the inspection team with\na risk-factor form (a document that it planned to use to collect information on its pipeline\nsystem) that was inconsistent with its draft risk assessment methodology. Finally, the\nNotice alleged that Alon could not demonstrate how it planned to use any of the data\ngathered from the risk-factor form in its IMP.\nAlon admitted in its Response that it presented OPS with a draft risk assessment method\ntaken verbatim from a textbook but “only as an example of the type of risk assessment\ntool being developed for [it] at the time.”11\nRespondent admitted, in other words, that it\nhad not developed and was not implementing a compliant risk assessment method as of\n11 Response at 7 (emphasis added).\n\n\n\n7\nthe date of the OPS inspection. Alon also necessarily acknowledged, by implication, that\nit failed to develop an integrity assessment schedule based upon a valid risk assessment\nmethodology. Accordingly, I find that Alon violated 49 C.F.R. § 195.452(e)(1) and\n(g)(1)-(4) by failing to develop and perform a compliant risk assessment and information\nintegration analysis in establishing its BAP schedule.\nItem 4(b) of the Notice likewise alleged that Alon violated 49 C.F.R. § 195.452(e)(1) by\nfailing to establish an integrity assessment schedule that prioritized its pipeline segments\nfor assessment based on all risk factors that reflect the risk conditions on the pipeline\nsegment. In particular, the Notice alleged that Alon limited its risk assessment method to\nonly those pipeline segments that could affect HCAs, instead of collecting and integrating\ninformation on its entire pipeline system, including breakout tanks and pump stations.\nIn its Response, Alon argued that its risk assessment method included pump stations at\nthe time of the inspection. Respondent acknowledged, however, that its analysis did not\ninclude breakout tanks until after the OPS inspection. On the basis of the latter\nadmission, and upon consideration of all of the evidence, I find that Respondent violated\n49 C.F.R. § 195.452(e)(1) by failing to have a risk assessment method that incorporated\nthe collection and integration of information on its entire pipeline system for use in\nestablishing a compliant integrity assessment schedule.\nItem 4(c) of the Notice similarly alleged that Alon violated 49 C.F.R. § 195.452(e)(1) by\nfailing to establish an integrity assessment schedule that prioritized its pipeline segments\nfor assessment based on all risk factors that reflect the risk conditions on the pipeline\nsegment. Specifically, the Notice alleged that Respondent’s IMP provided no guidance\nor information on the assignment of risk scores based on the subjective risk-assessment-\nmethod inputs. The Notice further stated that without such guidance, Alon’s risk-scores\n(and any prioritization of its pipeline segments for integrity assessment on the basis\nthereof) would vary and be unreliable over time.\nIn its Response, Alon argued that its IMP included written assessment questions and\nformatted responses that dealt with risk ranking and submitted documentation of its\nwritten procedure.12 Respondent did not, however, dispute the allegation that the former\nwritten procedure was not in place at the time of the OPS inspection. In addition, the\ndocument Alon submitted did not indicate the effective date of the procedure.13\nAccordingly, upon consideration of all of the evidence, I find that Respondent violated 49\nC.F.R. § 195.452(e)(1) by failing to include proper guidance in its IMP on the assignment\nof risk scores based on the subjective risk-assessment-method inputs for use in\nestablishing a compliant integrity assessment schedule.\n12 Response at Attachment 4.3.\n13 Moreover, at least some of the questions listed on the written procedure of record are in need of further\nclarification. For example, the form asks, without further guidance, whether relationship with local authorities is\n“excellent,” “good,” or “poor,” and whether the pipe material looks “excellent,” “good,” or “poor ”. Response at\nAttachment 4.3, pp. 5, 6.\n\n\n\n8\nItem 5 of the Notice alleged that Alon violated 49 C.F.R. § 195.452(l)(1), which states,\nin relevant part:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . .\n(l) What records must be kept?\n(1) An operator must maintain for review during an inspection:\n(i) A written integrity management program in accordance with\nparagraph (b) of this section.\n(ii) Documents to support the decisions and analyses, including any\nmodifications, justifications, variances, deviations and determinations made,\nand actions taken, to implement and evaluate each element of the integrity\nmanagement program listed in paragraph (f) of this section.\nThe Notice alleged that Alon violated 49 C.F.R. 195.452(l)(1) by failing to maintain\nproper documentation of the decisions and analyses, including any modifications,\njustifications, variances, deviations and determinations made, and actions taken, to\nimplement and evaluate each element of its IMP. Specifically, the Notice stated that\nAlon failed to properly document the modifications it had previously made to its\nFebruary 2002 IMP and that it lacked a procedure for tracking such changes.\nIn its Response, Alon disputed these allegations. In particular, Respondent argued that it\nhad documented the changes made to its February 2002 IMP and that it had a procedure\nin place for making, implementing, and tracking such changes as of the date of the\ninspection. In support of its position, Alon submitted its written procedure for\ndocumenting changes to its IMP14 and a Master Change Log showing the changes that\nhad been made to its IMP since July 3, 2003.15\nThis evidence, however, is not persuasive. First, the written procedure submitted by\nAlon is dated August 13, 2003, less than a week prior to the OPS inspection, and no other\nevidence exists that contradicts the OPS inspector’s allegation that an adequate procedure\nwas not in effect as of March 31, 2002, the date required under the regulation. Moreover,\neven if Alon had a written procedure in effect at that time, the Master Change Log makes\nno mention of the decisions, analyses, and actions the company had taken in transitioning\nfrom the February 2002 IMP to the March 2002 IMP. On the contrary, the first notation\nin the Master Change Log is dated July 2003, more than a year after Alon had\ntransitioned from its February 2002 IMP to its March 2002 IMP. Furthermore, the\nMaster Change Log characterizes the March 2002 edition as Alon’s “[o]riginal” IMP,\neven though the company argued in its Response that the February 2002 IMP was the\nfirst written edition of that program. In other words, there is no evidence that Alon had a\nrecordkeeping procedure prior to August 2003, even though the regulation required one\nas of March 31, 2002, or that the company followed such a procedure if in effect during\nthat time period. Accordingly, upon consideration of the evidence of record, I find that\n14 Response at Attachment 5.0.\n15 Response at Attachment 5.1.\n\n\n\n9\nRespondent violated 49 C.F.R. § 195.452(l)(1) by failing to maintain documents\nsupporting the decisions, analyses, and actions taken in modifying its February 2002\nIMP.\nItems 6(a), (b), and (c) of the Notice alleged that Alon had violated 49 C.F.R.\n§195.452(f)(3) and (g)(1)-(4), which state, in relevant part:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . .\n(f) What are the elements of an integrity management program?\nAn integrity management program begins with the initial framework. An\noperator must continually change the program to reflect operating\nexperience, conclusions drawn from results of the integrity assessments,\nand other maintenance and surveillance data, and evaluation of\nconsequences of a failure on the high consequence area. An operator\nmust include, at minimum, each of the following elements in its written\nintegrity management program:\n(1) . . .\n(3) An analysis that integrates all available information about the\nintegrity of the entire pipeline and the consequences of a failure (see\nparagraph (g) of this section); . . .\n(g) What is an information analysis? In periodically evaluating\nthe integrity of each pipeline segment (paragraph (j) of this section), an\noperator must analyze all available information about the integrity of the\nentire pipeline and the consequences of a failure. This information\nincludes:\n(1) Information critical to determining the potential for, and\npreventing, damage due to excavation, including current and planned\ndamage prevention activities, and development or planned development\nalong the pipeline segment;\n(2) Data gathered through the integrity assessment required\nunder this section;\n(3) Data gathered in conjunction with other inspections, tests,\nsurveillance and patrols required by this Part, including, corrosion\ncontrol monitoring and cathodic protection surveys; and\n(4) Information about how a failure would affect the high\nconsequence area, such as location of the water intake.\nItem 6(a) of the Notice alleged that Alon violated 49 C.F.R. § 195.452(f)(3) by failing to\ninclude in its IMP an analysis that integrated all available information about the integrity\nof its entire pipeline and the consequences of a failure. Specifically, the Notice alleged\nthat Respondent’s IMP did not include a compliant procedure for gathering, analyzing,\nand disseminating relevant information and findings on the integrity of each pipeline\nsegment that could affect HCAs. For example, it alleged that Alon had not correlated the\nresults of in-line inspection (ILI) tool runs on the Amdel Pipeline to determine if any of\nthe dents that had been detected involved metal loss and had not compared the results of\nthose ILI assessments to other information about that pipeline system.\n\n\n\n10\nIn its Response, Alon stated that its metal loss repair criteria exceeded the applicable\nregulatory requirements. The strictness of Respondent’s metal loss criteria is, however,\nnot relevant to the violation alleged in the Notice, namely, that Alon lacked a process for\nintegrating such ILI data upon its receipt. Alon also admitted that it had not developed\nany dent repair criteria until the adoption of its February 2002 IMP, and that it did not\ncorrelate the dent and metal loss data from these ILI tool runs until after the August 2003\nOPS inspection.16\nAccordingly, I find that Respondent violated 49 C.F.R. § 95.452(f)(3)\nby failing to include in its IMP an analysis that integrates all available information about\nthe integrity of its entire pipeline and the consequences of a failure.\nItem 6(b) of the Notice similarly alleged that Alon violated 49 C.F.R. § 195.452 (g)(1)-\n(4) by failing to include in its written IMP an adequate procedure for analyzing all\navailable information about the integrity of its entire pipeline and the consequences of a\nfailure. Specifically, the Notice stated the Respondent lacked a compliant procedure for\ncollecting and integrating field input and local knowledge on potential changes to\npipeline segments that could affect HCAs. For example, the Notice explained that Alon’s\nIMP failed to specify the methods and personnel responsible for gathering such\ninformation, and that the program did not include a process for recording and\ndisseminating that information.\nAlon disputed this allegation in its Response, contending that it had a written procedure\nin place at the time of the OPS inspection for collecting and using data on potential\nchanges to pipeline segments in HCAs. However, a review of Alon’s supporting\ndocumentation17\nshows that, while there was a procedure in place at that time, it failed to\naddress any of the deficiencies cited in the Notice. Indeed, that procedure neither\nidentifies the methods used nor the company personnel responsible for collecting data on\npipeline segments in HCAs. Nor does it include a meaningful description of the process\nfor recording or disseminating that information. Accordingly, I find that Respondent\nviolated 49 C.F.R. § 195.452(g)(1)-(4) by failing to include in its written IMP an\nadequate procedure for analyzing all available information about the integrity of the\nentire pipeline and the consequences of a failure.\nItem 6(c) of the Notice similarly alleged that Alon violated 49 C.F.R. § 195.452(g)(1)-\n(4) by failing to include in its written IMP an adequate procedure for analyzing all\navailable information about the integrity of its entire pipeline and the consequences of a\nfailure. In particular, the Notice stated that its IMP did not include any consideration of\nthe risks associated with the operation—or the consequences of a failure—of pump\nstations or breakout tanks.\nRespondent disputed this allegation in its Response. Specifically, Alon stated that its\nwritten IMP covered pump stations at the time of the OPS inspection. The company\nacknowledged, however, that it later revised some of its assumptions on the consequences\n16 Response at Attachment 6.0 (relating to the correlation of dent and metal loss data dated December 8, 2003).\n17 Response at Attachment 6.1, IMP-1.02-002 (revised as of August 13, 2003).\n\n\n\n11\nof a pump station failure and that it did not include breakout tanks in its IMP until after\nthe OPS inspection.\nUpon consideration of all the evidence of record, including Alon’s admission that its IMP\ndid not include breakout tanks at the time of the OPS inspection, I find that Respondent\nviolated 49 C.F.R. § 195.452(g)(1)-(4) by failing to include in its written IMP an\nadequate procedure for analyzing all available information about the integrity of its entire\npipeline and the consequences of a failure.\nItems 7(b) of the Notice alleged that Alon violated 49 C.F.R. § 195.452(i)(2), which\nstates:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . .\n(i) What preventive and mitigative measures must an operator take\nto protect the high consequence area?\n(1) . . .\n(2) Risk analysis criteria. In identifying the need for additional\npreventive and mitigative measures, an operator must evaluate the\nlikelihood of a pipeline release occurring and how a release could affect the\nhigh consequence area. This determination must consider all relevant risk\nfactors, including, but not limited to: . . .\nThe Notice alleged that Alon violated 49 C.F.R. § 195.452(i)(2) by failing to perform a proper\nrisk analysis to identify the need for additional preventive and mitigative measures to protect\nHCAs. Specifically, the Notice alleged that Respondent did not adequately consider in its draft\nrisk assessment the consequences of pipeline releases and how such releases could affect HCAs.\nRespondent disputed this allegation in its Response, contending that its Automated Risk\nAssessment Tool (ARAT) “uses the impact to HCAs as the consequence for the occurrence of a\nthreat” and the development of “threat lists” to determine the possible events that might occur\nand to develop preventive and mitigative measures. Alon also noted that at the time of the OPS\ninspection, it had a written procedure on preventative and mitigative measures.18\nThese arguments, however, are not responsive to the allegation in the Notice. First, the ARAT\nsystem was not operational at the time of the August 2003 OPS inspection and, therefore, is not\nrelevant. Second, the written procedure on preventative and mitigative measures that\nRespondent submitted only addressed the potential consequences of a failure in a cursory\nfashion. Third, and most importantly, that procedure relied on the same flawed methodologies—\ni.e., the inadequate identification of pipeline segments that could affect HCAs, the lack of\nintegrated information on the integrity of its pipeline system, and inadequate risk assessments—\ndescribed at length in the prior sections of this Final Order. Accordingly, upon consideration of\nall of the evidence, I find that Respondent violated 49 C.F.R. § 195.452(i)(2) by failing to\n18 Response at 11 and Attachment 7.1, IMP-4.001-010, Rev. 1.\n\n\n\n12\nconduct a proper risk analysis to identify the need for additional preventative and mitigative\nmeasures to protect HCAs.\nItem 8 of the Notice alleged that Alon violated 49 C.F.R. § 195.452(j)(1), which states, in\nrelevant part:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . .\n(j) What is a continual process of evaluation and assessment to\nmaintain a pipeline's integrity?\n(1) General. After completing the baseline integrity assessment, an\noperator must continue to assess the line pipe at specified intervals and\nperiodically evaluate the integrity of each pipeline segment that could affect a\nhigh consequence area.\nThe Notice alleged that Alon violated 49 C.F.R. § 195.452(j)(1) by failing to specify in its IMP a\ntime frame, after completing its BAP, for continuing to assess the line pipe at specified intervals\nand to periodically re-evaluate the integrity of each pipeline segment that could affect an HCA.\nThe Notice further alleged that Alon failed to include a time frame in which to conduct an\nevaluation to determine whether reassessments should be performed at shorter intervals.19\nRespondent disputed this allegation in its Response, contending that its IMP now includes\nthe allegation that no such procedure existed at the time of the OPS inspection. In addition,\nunlike some of the other written procedures submitted by Respondent, the one at issue here\nincludes no effective date. Thus, there is no evidence in the record that contradicts the OPS\ninspector’s allegation that Alon’s IMP included no such time frame during the inspection.\nAccordingly, upon consideration of all of the evidence, I find that Respondent violated 49 C.F.R.\ncriteria for requiring reassessments within a shorter interval.20 Alon has not, however, refuted\n§ 195.452(j)(1) by failing to include in its IMP a time frame, after completing its BAP, for\ncontinuing to assess the line pipe at specified intervals and to periodically re-evaluate the\nintegrity of each pipeline segment that could affect an HCA.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nWITHDRAWAL OF ALLEGATION\nItems 7(a) of the Notice alleged that Alon violated 49 C.F.R. § 195.452(i)(3), which\nstates:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . .\n19 See 49 C.F.R. § 195.452(j)(2)-(3).\n20 Response at Attachment 8.0, IMP-4.01-009.\n\n\n\n13\n(i) What preventive and mitigative measures must an operator take\nto protect the high consequence area?\n(1) . . .\n(3) Leak detection. An operator must have a means to detect leaks\non its pipeline system. An operator must evaluate the capability of its leak\ndetection means and modify, as necessary, to protect the high consequence\narea. An operator's evaluation must, at least, consider, the following factors-\nlength and size of the pipeline, type of product carried, the pipeline's\nproximity to the high consequence area, the swiftness of leak detection,\nlocation of nearest response personnel, leak history, and risk assessment\nresults.\nThe Notice alleged that Alon violated 49 C.F.R. § 195.452(i)(3) by failing to conduct a proper\nrisk analysis to determine what additional preventive and mitigative measures might be needed\nto protect HCAs. Specifically, the Notice stated that Alon’s risk analysis did not adequately\nevaluate the capability of its leak detection system. In support of that allegation, the Notice cited\nRespondent’s purported failure to consider an incident that occurred on February 11, 2001, and\nto determine whether that incident justified making any changes to its leak detection system.\nRespondent disputed these allegations in its Response. After noting that the February 2001\nof the leak showed that the affected line did not experience any concurrent decrease in operating\npressure and that the leak would not have been detected by a lower alarm set point. Therefore,\nResponse contended that this incident did not warrant any changes to its leak detection system.\nIn addition, Respondent alleged that the OPS inspectors did not ask for or review any of the\nthe U.S. Environmental Protection Agency.","truncated":true,"body_characters":59150}