SUNRISE POWER COMPANY, LLC — Notice of Probable Violation

520050026_final order_04182008_text.pdf, page 1Official PDFO U S Department of Transportation Pipeline and Hazardous Materials Safety Administration 1200 New Jersey Ave S E Washington DC 20590 P, PR1 8 %8' Mr. Ron Muse Vice President Edison Mission Operation and Maintenance, Inc. P. O. Box 5485 Bakersfield, CA 93388 Re: CPF No. 5-2005-0026 Dear Mr, Muse: Enclosed is the Final Order issued m the above-referenced case. It makes findings of violation and specifies actions to be taken to comply with the pipeline safety regulations. When the terms of the Compliance Order have been completed, as determined by the Director, Western Region, this enforcement action will be closed. Your receipt of the Final Order constitutes service under 49 C. F R. ( 190. 5. Thank you for your cooperation in this matter. Smcerely, Jeffrey D. Wiese Associate Administrator for Pipeline Safety Enclosure cc: Mr. Chris Hoidal, P. E. , Director Western Region, PHMSA Mr. David S. King, EMOM Plant Manager CERTIFIED MAIL — RETURN RECEIPT RE UESTED#

520050026_final order_04182008_text.pdf, page 2U. S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY WASHINGTON, DC 20590 ) ) ) Edison Mission Operation 4 Maintenance, Inc. ) Respondent ) ) CPF No. 5-2005-0026 FINAL ORDER On August 30-31, 2005, pursuant to 49 U S. C. ) 60117, a representative of the Pipeline and Hazardous Materials Safety Administration's (PHMSA's) Office of Pipeline Safety conducted an on-site pipeline safety inspection of the natural gas facilities and records of Edison Mission Operation and Maintenance, Inc. a , subsidiary of Edison International (Edison or Respondent), near Fellows, California. As a result of the inspection, the Director, Western Region, Office of Pipeline Safety (OPS), issued to Respondent, by letter dated November 16, 2005, a Notice of Probable Violation and Proposed Compliance Order (Notice) In accordance with 49 C. F. R. ) 190. 207, the Notice proposed finding that Respondent had violated 49 C. F. R. $$ 192. 605 (referencing Subparts L and M), 192. 603, 192. 491, 192. 709, and 192. 305 and proposed ordering Respondent to take certain measures to correct the alleged violations. The Notice also warned that Edison had committed probable violations of 49 C. F. R. ))192. 706, 192, 479, and 191. 17 and advised Respondent to take appropriate corrective actions, In its response to the Notice (Response), Respondent did not contest the allegations of violation but provided information concerning the corrective actions it had taken. Respondent did not request a hearing and therefore has waived its right to one FINDINGS OF VIOLATION As noted above, Respondent did not contest the violations alleged in the Notice. Accordingly, I find that Respondent violated the following sections of 49 C F. R. Part 192, as follows: Item 1: $192. 605 Procedural manual for operations, maintenance, and emergencies.#

520050026_final order_04182008_text.pdf, page 3(a) General Each operator shall prepare and follow for each pipeline, a manual of written procedures for conducting operations and maintenance activities and for emergency response. For transmission lines, the manual must also mclude procedures for handling abnormal operations. . . . . Item 1 of the Notice alleged that Edison did not have a manual of written procedures (0 & M Manual) for conducting normal and abnormal operations, maintenance activities, and for emergency response that met the requirements of $192. 605(a), (b), (c), (d), and (e) for a natural gas transmission pipeline Accordingly, I find that Respondent violated 49 C. F. R. ) 192. 605 by failing to have an 0 & M Manual with procedures for a gas transmission pipeline. Item 2: $192. 605 Procedural manual for operations, maintenance, and emergencies. (a). . . . . . (b) Maintenance and normal operations The manual required by paragraph (a) of this section must include procedures for the following, if applicable, to provide safety during maintenance and operations. (1) Operating, maintaining, and repairing the pipelme in accordance with each of the requirements of this subpart [L] and Subpart M of this part. Item 2 of the Notice alleged that Edison failed to establish written procedures to address the applicable sections of subpart L and M listed below, even if they might not currently be utilized under normal operating conditions, and that its written procedures must be comprehensive and sufficiently detailed to allow personnel to perform their duties in a safe and reliable manner The Pipeline Safety Regulations guided by Edison's circumstances control the content of the 0 & M Manual, The following is a list of applicable sections of subparts L and M for which adequate procedures were lacking. Subpart L — Operations $192. 609 Change in class location: Required study. $192. 611 Change in class location: Confirmation or revision of maximum allowable operating pressure. $192. 613 Continuing surveillance. $192. 614 Damage prevention program. $192. 615 Emergency plans.#

520050026_final order_04182008_text.pdf, page 43 §192.616 Public awareness. §192.617 Investigation of failures. $192.619 Maximum allowable operating pressure: Steel or plastic pipelines. §192.625 Odorization of gas. §192.627 Tapping pipelines under pressure. $192.629 Purging of pipelines. Subpart M -- Maintenance §192.703 General. §192.705 Transmission lines: Patrolling. §192.706 Transmission lines: Leakage surveys. $192.707 Line markers for mains and transmission lines. $192.709 Transmission lines: Record keeping. §192.711 Transmission lines: General requirements for repair procedures. §192.713 Transmission lines: Permanent field repair of imperfections and damages. $192.715 Transmission lines: Permanent field repair of welds. §192.717 Transmission lines: Permanent field repair of leaks. §192.719 Transmission lines: Testing of repairs. §192.727 Abandonment or deactivation of facilities. §192.739 Pressure limiting and regulating stations: Inspection and testing.#

520050026_final order_04182008_text.pdf, page 5$192. 743 Pressure limiting and regulating stations: Capacity and relief devices. $192. 745 Valve maintenance: Transmission lines. $192. 751 Prevention of accidental ignition. Accordingly, I find that Respondent violated 49 C. F. R. ) 192. 605(b) by failing to have a manual of written procedures to address all applicable sections of subparts L and M, includmg all those sections referenced above Item 3: f 192. 603 General provisions. (a) " " (b) Each operator shall keep records necessary to administer the procedures established under $ 192. 605. Item 3 of the Notice alleged that Edison did not have a formal record keeping program that met all of the requirements of (192. 603. Accordingly, I find that Respondent violated 49 C. F. R. $ 192. 603(b) by failing to have a formal record keeping program to administer the 0 2 M requirements of Part 192. Item 4: $192. 491 Corrosion control records. (a) "" (c) Each operator shall maintain a record of each test, survey, or inspection required by this subpart in sufficient detail to demonstrate the adequacy of corrosion control measures or that a corrosive condition does not exist. These records must be retained for at least 5 years, except that records related to $192. 465(a) and (e) and $192. 475(b) must be retained for as long as the pipeline remains in service. Item 4 of the Notice alleged that Edison failed to maintain and produce documentation that would indicate corrosion control maintenance activities had been conducted on its pipeline systems. For example, there were no records showing that Edison performed a reading of the casing and a pipe-to-soil potential in the year of 2003 on the Sunrise Power Plant pipeline. Accordingly, I find that Respondent violated 49 C. F, R. ( 192. 491(c) by failing to maintain records of each test, survey, or inspection required for corrosion control under subpart I of Part 192. Item 5: $192. 709 Transmission lines: Record keeping. Each operator shall maintain the following records for transmission lines for the periods specified: . . . . . (b) The date, location, and description of each repair made to parts of the pipeline system other than pipe must be retained for at least 5 years, However, repairs generated by patrols, surveys, inspections, or tests required by subparts subparts L and M of this part must be retained in accordance with paragraph (c) of this section.#

520050026_final order_04182008_text.pdf, page 6Item 5 of the Notice alleged that Edison did not have a formal record keeping program that met all of the requirements of )$ 192. 739 and 192. 743 regarding overpressure protection. Accordingly, I find that Respondent violated 49 C. F. R. $ 192. 709(b) for failing to mamtain records relating to testing and inspection requirements for overpressure protection under $$ 192. 739 and 192. 743. Item 7: g 192. 305 Inspection: General. Each transmission line or main must be inspected to ensure that it is constructed in accordance with this part, Item 7 of the Notice alleged that Edison did not have a formal record keeping program showing that it had met the requirements of $( 192. 241(a), 192. 243(b)(2), 192. 243(c), and 192, 325 regarding the testing and inspection of welds and underground clearances Accordingly, I find that Respondent violated 49 C. F. R. ( 192. 305 for failing to demonstrate that it had complied with the testing and inspections requirements of )) 192. 241(a), 192. 243(b)(2), 192. 243(c), and 192. 325 for the testing and inspection of transmission lines or mains. These findings of violation will be considered prior offenses in any subsequent enforcement action taken against Respondent. COMPLIANCE ORDER The Notice proposed a Compliance Order with respect to Items 1, 2, 3, 4, 5, and 7 in the Notice for violations of 49 C. F. R. $$ 192. 605, 192. 603, 192. 491, 192. 709, and 192. 305. Under 49 U. S. C, ) 60118(a), each person who engages in the transportation of gas or who owns or operates a pipeline facility is required to comply with the applicable safety standards established under Chapter 601, Pursuant to the authority of 49 U. S. C. ) 60118(b) and 49 C. F, R. ) 190, 217, Respondent is ordered to take the actions set forth below to ensure compliance with the pipelme safety regulations applicable to its operations. The Regional Director has indicated that Respondent has taken action to address some of the cited violations. With respect to Notice Items 1 and 2, Respondent submitted documents and information that PHMSA's Western Region Office has reviewed. I find that these actions comply with the requirements of Items 1 and 2 of the Proposed Compliance Order and therefore do not need to be included in this Order. For the remaining Items, Respondent must— 1. With respect to Notice Item 3— a. Develop and maintain a formal record keeping program that meets all the requirements of 49 C. F. R. $ 192. 603(b); b. Establish a damage prevention program as required by 49 C. F R. ) 192, 614; c. Establish a liaison program with public officials as required by 49 C. F. R. $ 192. 615(c);#

520050026_final order_04182008_text.pdf, page 7d. Establish a public education program as required by 49 C. F. R. $ 192. 616; e. Establish a calculation on maximum allowable operating pressure as required by 49 C. F. R. ) 192. 619; f. Perform pipeline patrolling as required by 49 C F, R. ) 192. 705; g. Perform leak surveys as required by 49 C. F. R. ) 192. 706; h. Perform a test on relief devices along the pipeline segments as required by 49 C. F. R. 5 192. 743; i. Perform valve maintenance along the pipeline segments as required by 49 C. F. R. 5 192. 745; j, Perform vault maintenance along the pipeline segments as required by 49 C. F. R. $ 192. 749. 2. With respect to Notice Item 4, develop and maintain a formal record keeping program that entirely meets the corrosion control requirements of 49 C. F. R. ) 192, 491(c) and SubPart I; 3. With respect to Notice Item 5, develop a formal record keeping program that meets all of the requirements of 49 C. F. R, )$ 192. 739 and 192, 743 to ensure adequate overpressure protection is being provided for its facility; 4. With respect to Notice Item 7, develop a formal record keeping program that meets the construction requirements of 49 C. F. R. $$ 192. 241(a), 192. 243(b)(2), 192. 243(c), Gild 192. 325; 5. Maintain documentation of the safety improvement costs associated with fulfilling this Compliance Order and submit the total to Director, Western Region, PHMSA. Costs shall be reported in two categories: 1) total cost associated with preparation/revision of plans, procedures, studies and analyses, and 2) total cost associated with replacements, additions and other changes to pipeline infrastructure; and 6. Within 30 days of issuance of the Final Order, accomplish the above items Once adequate procedures are developed, they must be implemented in accordance with the procedures, and documented as necessary. Please submit the procedures and evidence of the actions taken to Director, Western Region, Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety, 12300 West Dakota Avenue, Suite 110, Lakewood, Colorado 80228. Please refer to 5-2005-0026. The Director may grant an extension of time to comply with any of the required items upon a written request timely submitted by the Respondent demonstrating good cause for an extension.#

520050026_final order_04182008_text.pdf, page 8Failure to comply with this Order may result in administrative assessment of civil penalties not to exceed $100, 000 for each violation for each day the violation continues or m referral to the Attorney General for appropriate relief in a district court of the United States. WARNING ITEMS With respect to Items 6, 8, and 9, the Notice alleged probable violations of Parts 191 and 192 but did not propose a civil penalty or Compliance Order for these items Therefore, these are considered to be warning items. These warnings were for: 49 C. F R. ) 192. 706 (a) and (b) (Notice Item 6) — Respondent's alleged failure to document leakage surveys between 2003 and 2004; 49 C. F. R. $ 192. 479 (a), (b) and (c)(1)(2) (Notice Item 8) — Respondent's alleged failure to adequately monitor corrosion control; 49 C. F. R. $ 191. 17 (Notice Item 9) — Respondent's alleged failure to properly submit annual reports. In its Response, Respondent did not contest these allegations. Accordingly, I find, pursuant to 49 C. F. R. $ 190. 205, that probable violations of 49 C. F. R. $) 192. 706(a) and (b) (Notice Item 6), 192. 479(a), (b), and (c) (Notice Item 8), and 191. 191. 17 (Notice Item 9) have occurred and Respondent is hereby advised to correct such conditions. In the event that PHMSA finds a violation for any of these items in a subsequent inspection, Respondent may be subject to future enforcement action. Under 49 C. F. R. ) 190. 215, Respondent has a right to submit a Petition for Reconsideration of this Final Order. The petition must be received within 20 days of Respondent's receipt of this Final Order and must contain a brief statement of the issue(s). The terms of the Order, includmg any required corrective action, remain in full effect unless the Associate Administrator, upon request, grants a stay. The terms and conditions of this Final Order shall be effective upon receipt. APR1 8 Ã08 Jeffrey D. Wiese Associate Administrator for Pipeline Safety Date Issued#