{"operation":"document","citation":"CPF 520047003","title":"ARGUELLO, INC. — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2004-09-27","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.452(c)(1)(i)(a), 195.452(e)(2), 195.452(i)(2), 195.452(k).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520047003.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520047003.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520047003","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520047003","body":"Notice of Probable Violation involving ARGUELLO, INC.. PHMSA's enforcement data identifies the cited regulations as 195.452(c)(1)(i)(a),  195.452(e)(2),  195.452(i)(2),  195.452(k). The case was opened on 2004-09-27 and is reported as closed as of 2009-01-30. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520047003_FinalOrder_01302009.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520047003/520047003_FinalOrder_01302009.pdf\n\n520047003_FinalOrder_01302009_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520047003/520047003_FinalOrder_01302009_text.pdf\n\n520047003_FinalOrder_01302009_text.pdf\n\nCERTIFIED MAIL – RETURN RECEIPT REQUESTED\nMr. John F. Wombwell\nVice President & Secretary\nArguello, Inc.\n700 Milam, Suite 3100\nHouston, Texas, 77002\nRe: CPF No. 5-2004-7003\nDear Mr. Wombwell:\nEnclosed is the Final Order issued in the above-referenced case. It makes findings of violation\nand finds that Arguello (now operating as PXP) has completed the actions specified in the Notice\nthat were required in order to bring the company into compliance with the pipeline safety\nregulations. The Order also finds that Arguello has addressed the inadequacies in its procedures\nthat were cited in the Notice of Amendment. Therefore, this case is now 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, Director Western Region, PHMSA\nMr. James Flores, Chairman, President, and Chief Executive Officer\nPlains Exploration & Production Company (PXP)\n700 Milam, Suite 3100, Houston, TX 77002\nMr. Thomas Goeres, Management Steering Committee Representative\nArguello, Inc., 201 South Broadway, Orcutt, CA 93455\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 )\nArguello, Inc. ) CPF No. 5-2004-7003\na/k/a PXP – Arguello, Inc., )\n)\n)\n)\nRespondent. )\n__________________________________________)\nFINAL ORDER\nOn May 24 and 25, 2004, pursuant to 49 U.S.C. § 60117, representatives of the Pipeline and\nHazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS), and the\nCalifornia State Fire Marshall inspected the Integrity Management Program (IMP) of Arguello,\nInc. (Arguello or Respondent), the operator of a 24-inch crude oil pipeline in California and\nwholly-owned subsidiary of Plains Exploration and Production Company (PXP),1 a national\nenergy company headquartered in Houston, Texas.\nAs a result of the inspection, the Director, Western Region, PHMSA (Director), issued to\nRespondent, by letter dated September 27, 2004, a Notice of Probable Violation, Proposed\nCompliance Order, and Notice of Amendment (Notice).2 In accordance with 49 C.F.R.\n§ 190.207, the Notice proposed finding that Respondent had committed various violations of\n49 C.F.R. § 195.452 and ordering Arguello to take certain corrective actions. The Notice also\nproposed, in accordance with 49 C.F.R. § 190.237, that Respondent amend its IMP procedures.\nRespondent responded to the Notice by letter dated October 19, 2004 (Response). The company\ndid not contest the allegations of violation, but provided information concerning the corrective\nactions it had taken and copies of its revised IMP procedures. Respondent did not request a\nhearing and has therefore waived its right to one.\nFINDINGS OF VIOLATION\nItem 1: Item 1 of the Notice alleged that Respondent had violated 49 C.F.R.\n§§ 195.452(c)(1)(i)(A) and (f), which state, in relevant part:\n1 In May 2007, Arguello transferred operation of the pipeline to PXP.\n2 The Notice was inadvertently issued to “PXP - Arguello Inc.,” but Arguello, Inc., filed a Response..\n\n\n\n2\n§ 195.452 Pipeline integrity management in high consequence\nareas.\n(a) . . .\n(c) What must be in the baseline assessment plan? (1) An\noperator must include each of the following elements in its\nwritten 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\nfailure must be capable of assessing seam integrity and of detecting\ncorrosion and deformation anomalies.\n(A) Internal inspection tool or tools capable of detecting corrosion\nand deformation anomalies including dents, gouges and grooves; . . .\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 must\ninclude, at minimum, each of the following elements in its written\nintegrity management program . . .\nThe Notice alleged that Respondent used an inadequate pipeline integrity assessment method in\nits baseline assessment plan (BAP), namely, one that was not conducted with the proper\ncombination of “[i]nternal inspection . . . tools capable of detecting corrosion and deformation\nanomalies including dents, gouges and grooves.” 49 C.F.R. § 195.452(c)(1)(i)(A).3 Respondent\ndo not contest the allegation. Accordingly, I find that Respondent violated 49 C.F.R. §\n195.452(c)(1)(i)(A), as alleged in Item 1 of the Notice, by failing to select for its BAP a method\nto assess the integrity of line pipe that included an “[i]nternal inspection tool or tools capable of\ndetecting corrosion and deformation anomalies including dents, gouges and grooves.”\nItem 3: The Notice alleged that Respondent had violated 49 C.F.R. §§ 195.452(i)(1) and (4),\nwhich state, in relevant part:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . . .\n(i) What preventive and mitigative measures must an operator take to\nprotect the high consequence area? (1) General requirements. An operator must\ntake measures to prevent and mitigate the consequences of a pipeline failure that\n3 Specifically, the Notice alleged that Respondent used the results of a prior pipeline integrity assessment\nin its BAP, and that this prior assessment was conducted only with the use of a magnetic flux leakage (MFL) inline\ninspection (ILI) tool. According to the Notice, an adequate assessment would require either (1) the use of both an\nMFL and a geometry ILI tool to properly detect corrosion and deformation anomalies, or (2) only the use of an MFL\ntool but then, upon the detection of any dents, running a geometry tool or treating all dents as immediate repairs.\n\n\n\n3\ncould affect a high consequence area. These measures include conducting a risk\nanalysis of the pipeline segment to identify additional actions to enhance public\nsafety or environmental protection. Such actions may include, but are not limited\nto, implementing damage prevention best practices, better monitoring of cathodic\nprotection where corrosion is a concern, establishing shorter inspection intervals,\ninstalling EFRDs [emergency flow restricting devices] on the pipeline segment,\nmodifying the systems that monitor pressure and detect leaks, providing\nadditional training to personnel on response procedures, conducting drills with\nlocal emergency responders and adopting other management controls. . . .\n(4) Emergency Flow Restricting Devices (EFRD). If an operator determines\nthat an EFRD is needed on a pipeline segment to protect a high consequence area\nin the event of a hazardous liquid pipeline release, an operator must install the\nEFRD. In making this determination, an operator must, at least, consider the\nfollowing factors--the swiftness of leak detection and pipeline shutdown\ncapabilities, the type of commodity carried, the rate of potential leakage, the\nvolume that can be released, topography or pipeline profile, the potential for\nignition, proximity to power sources, location of nearest response personnel,\nspecific terrain between the pipeline segment and the high consequence area, and\nbenefits expected by reducing the spill size. . . .\nThe Notice alleged that Respondent had developed, but not fully implemented, a process for the\nevaluation, identification, and implementation of preventive and mitigative measures (PMMs) to\nprotect the high consequence areas (HCAs) of its pipeline system. Arguello did not contest the\nallegation. Accordingly, I find that Respondent violated 49 C.F.R. §§195.452(i)(1) and (4) by\nfailing to fully implement a process for the evaluation, identification, and implementation of\nPMMs to protect the HCAs of its pipeline system.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nCOMPLIANCE ORDER\nThe Notice proposed a Compliance Order with respect to Items 1 and 3 in the Notice for\nviolations of 49 C.F.R. §§ 195.452(c)(1)(i)(A) and (f) and 195.452(i)(1) and (4), respectively.\nUnder 49 U.S.C. § 60118(a), each person who engages in the transportation of gas or hazardous\nliquids or who owns or operates a pipeline facility is required to comply with the applicable\nsafety standards established under chapter 601. The Director has indicated that Respondent has\nsatisfactorily completed the following actions specified in the proposed Compliance Order:\nWith regard to the violation of 49 C.F.R. §§ 195.452(c)(1)(i)(A) and (f) described\nin Item 1 of the Notice, Respondent revised its Liquid IMP “to include the\nrequirement of geometry tool or physical inspection in conjunction with a metal\nloss tool when the metal loss tool shows any indications of dents.” Respondent\nalso provided a copy of this revision to the Director.\n\n\n\n4\nWith regard to the violation of 49 C.F.R. §§ 195.452(i)(1) and (i)(4) described in\nItem 3 of the Notice, Respondent provided documentation of additional\npreventive and mitigative measures it has taken to the Director.\nAccordingly, since compliance has been achieved with respect to these violations, the\ncompliance terms are not included in this Order.\nAMENDMENT OF PROCEDURES\nThe Notice alleged inadequacies in Respondent’s Liquid IMP plans and procedures and proposed\nrequiring Arguello to amend its plans and procedures to comply with the requirements of 49\nC.F.R. § 195.452.\nRespondent has submitted copies of its amended procedures to the Director, who has reviewed\nthem. Based on the results of that review, I find that Respondent’s original procedures, as\ndescribed in the Notice, were inadequate to ensure safe operation of its pipeline system, but that\nRespondent has corrected the identified inadequacies. Therefore, no need exists to issue an order\ndirecting amendment.\nThe terms and conditions of this Final Order shall be effective upon receipt.\n___________________________________ __________________________\nJeffrey D. Wiese Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":11228}