{"operation":"document","citation":"CPF 520055015","title":"EXXONMOBIL PRODUCTION COMPANY, A DIVISION OF EXXON MOBIL CORPORATION — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2005-03-22","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.452(b)(3), 195.452(c)(1), 195.452(c)(2), 195.452(e)(1), 195.452(f), 195.452(f)(1), 195.452(f)(4), 195.452(f)(7), 195.452(f)(8), 195.452(h)(2), 195.452(i)(1), 195.452(j)(3), 195.452(l)(ii).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520055015.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520055015.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520055015","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520055015","body":"Notice of Probable Violation involving EXXONMOBIL PRODUCTION COMPANY, A DIVISION OF EXXON MOBIL CORPORATION. PHMSA's enforcement data identifies the cited regulations as 195,  195.452(b)(3),  195.452(c)(1),  195.452(c)(2),  195.452(e)(1),  195.452(f),  195.452(f)(1),  195.452(f)(4),  195.452(f)(7),  195.452(f)(8),  195.452(h)(2),  195.452(i)(1),  195.452(j)(3),  195.452(l)(ii). The case was opened on 2005-03-22 and is reported as closed as of 2009-10-14. Proposed civil penalty: $15,000. Assessed civil penalty: $15,000. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520055015_Final Order_06112009.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520055015/520055015_Final%20Order_06112009.pdf\n\n520055015_Final Order_06112009_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520055015/520055015_Final%20Order_06112009_text.pdf\n\n520055015_Final Order_06112009_text.pdf\n\nJUN 11 2009\nMr. Randy Cleveland\nProduction Manager for U.S. Production\nExxonMobil Production Company\nP.O. Box 4358\nHouston, TX 77210-4358\nRe: CPF No. 5-2005-5015\nDear Mr. Cleveland:\nEnclosed is the Final Order issued in the above-referenced case. It makes findings of\nviolation and assesses a civil penalty of $15,000. The Final Order also specifies actions that\nneed to be taken by ExxonMobil to comply with the pipeline safety regulations and requires the\nrevision of certain operating and maintenance procedures. The penalty payment terms are set\nforth in the Final Order. When the civil penalty has been paid and the terms of the Compliance\nOrder and Amendment of Procedures completed, as determined by the Director, Western\nRegion, this enforcement action will be closed. Your receipt of the Final Order constitutes\nservice 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: Chris Hoidal, Director, Western Region, PHMSA\nCERTIFIED MAIL – RETURN RECEIPT REQUESTED\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 )\nExxonMobil Production Company, ) CPF No. 5-2005-5015\n)\n)\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nOn December 1-2, 2004, pursuant to 49 U.S.C. § 60117, a representative of the Pipeline and\nHazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),\nconducted an on-site pipeline safety inspection of ExxonMobil Production Company’s\n(ExxonMobil’s or Respondent’s) integrity management program in Houston, Texas.1\nExxonMobil Production Company is a subsidiary of ExxonMobil Corporation and operates\nseveral hundred miles of pipelines in Texas, Alabama, Colorado, and in Federal and State waters.\nAs a result of the inspection, the Director, Western Region, OPS (Director), issued to\nRespondent, by letter dated March 22, 2005, a Notice of Probable Violation, Proposed Civil\nPenalty, Proposed Compliance Order, and Notice of Amendment (Notice). In accordance with\n49 C.F.R. § 190.207, the Notice proposed finding that Respondent had committed violations of\n49 C.F.R. Part 195, proposed assessing a civil penalty of $15,000 for the alleged violations, and\nproposed ordering Respondent to take certain measures to correct the alleged violations. The\nNotice also proposed, in accordance with 49 C.F.R. § 190.237, that Respondent amend its\nprocedures for operations, maintenance and emergencies.\nRespondent responded to the Notice by letter dated April 22, 2005, as supplemented by letter\ndated June 21, 2005. Respondent contested the allegations and requested a hearing. A hearing\nwas held on November 8, 2006 in Lakewood, Colorado with Mr. Larry White, Office of Chief\nCounsel, PHMSA, presiding. At the hearing, Respondent was represented by counsel.\nFollowing the hearing, Respondent provided additional information for the record on December\n6, 2006, including a summary of the information it had presented at the hearing (collectively,\n“Response”).\n1 At the time of the inspection, OPS was part of the DOT’s Research and Special Programs Administration\n(RSPA). Effective February 20, 2005, the Pipeline and Hazardous Materials Safety Administration (PHMSA) was\nestablished pursuant to The Norman Y. Mineta Research and Special Programs Improvement Act, Pub. L. No. 108-\n426, 118 Stat. 2423 (2004). PHMSA succeeded to all authority formerly exercised by RSPA under chapter 601 of\ntitle 49, United States Code. Pending enforcement matters were not affected. See also 70 Fed. Reg. 8299-8302\n(2005).\n\n\n\n2\nFINDINGS OF VIOLATION\nThe Notice alleged that Respondent violated 49 C.F.R. Part 195, as follows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(f), which states:\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 must\ninclude, at minimum, each of the following elements in its written\nintegrity management program:\n(1) A process for identifying which pipeline segments could affect\na high consequence area;\n(2) A baseline assessment plan meeting the requirements of\nparagraph (c) of this section;\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(4) Criteria for remedial actions to address integrity issues raised\nby the assessment methods and information analysis (see paragraph (h) of\nthis section);\n(5) A continual process of assessment and evaluation to maintain a\npipeline's integrity (see paragraph (j) of this section);\n(6) Identification of preventive and mitigative measures to protect\nthe high consequence area (see paragraph (i) of this section);\n(7) Methods to measure the program's effectiveness (see paragraph\n(k) of this section);\n(8) A process for review of integrity assessment results and\ninformation analysis by a person qualified to evaluate the results and\ninformation (see paragraph (h)(2) of this section).\nItem 1(a) of the Notice alleged that Respondent violated § 195.452(f)(1) by failing to adopt\nadequate procedures for collecting and using input from field personnel as part of its ongoing\nsegment identification activities under its integrity management (IM) program. At the hearing,\nExxonMobil pointed out that this item solely involved written procedures which were under\nrevision during the relevant period. After considering the information provided by ExxonMobil\nin its Response and at the hearing, I find that this item is more appropriately addressed as a\nNotice of Amendment (NOA). Accordingly, I am reducing this allegation of violation to a NOA\nand its disposition will be addressed in the Amendment of Procedures section below.\n\n\n\n3\nItem 1(c) of the Notice alleged that Respondent violated § 195.452(f)(1) by failing to have a\nsegment identification process in place sufficient to ensure that all pipe segments that could\nthe hearing, ExxonMobil conceded that it had not completed a risk-based listing of its “could\naffect” segments by the December 31, 2001, deadline set forth in the regulation. The company\nprovided additional information and explanations regarding the proposed penalty amount, which\nwill be discussed in the Assessment of Penalty section below. Accordingly, after considering all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.452(f)(1) by failing to have a\nHCA were covered by its IM program.\naffect a high consequence area (HCA) were covered by its IM program.2 In its Response and at\nsegment identification process in place sufficient to ensure that all segments that could affect an\nItem 1(d) alleged that Respondent’s IM program did not include adequate procedures for the\nsegment identification revision process. At the hearing, ExxonMobil pointed out that this item\nsolely involved written procedures which were under revision during the relevant period. After\nconsidering the information provided by Respondent in its Response and at the hearing, I am\nreducing this allegation of violation to a NOA and its disposition will be addressed in the\nAmendment of Procedures section below.\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(b)(3), which states:\n§ 195.452 Pipeline integrity management in high\nconsequence 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(3) Include in the program a plan to carry out baseline assessments\nof line pipe as required by paragraph (c) of this section.\nItem 2(a) of the Notice alleged that Respondent violated § 195.452(b)(3) by failing to adopt\nadequate procedures for specifying and technically justifying the choice of assessment methods\nto be used for each pipeline segment. At the hearing, ExxonMobil pointed out that this item\nsolely involved written procedures which were under revision during the relevant period. After\nconsidering the information provided by ExxonMobil in its Response and at the hearing, I am\nreducing this allegation of violation to a NOA and its disposition will be addressed in the\nAmendment of Procedures section below.\n2 The process of identifying pipeline segments that “could affect” HCAs is a key early step in an IM program. An\nHCA is defined as: (1) A commercially navigable waterway, which means a waterway where a substantial\nlikelihood of commercial navigation exists; (2) A high population area, which means an urbanized area, as defined\nand delineated by the Census Bureau, that contains 50,000 or more people and has a population density of at least\n1,000 people per square mile; (3) An other populated area, which means a place, as defined and delineated by the\nCensus Bureau, that contains a concentrated population, such as an incorporated or unincorporated city, town,\nvillage, or other designated residential or commercial area; (4) An unusually sensitive area, as defined in § 195.6.\nSee, 49 C.F.R. § 195.450\n\n\n\n4\nItem 2(b) of the Notice alleged that Respondent violated § 195.452(b)(3) by failing to adopt\nadequate procedures for the baseline assessment plan revision process. At the hearing,\nExxonMobil pointed out that this item solely involved written procedures which were under\nrevision during the relevant period. After considering the information provided by ExxonMobil\nin its Response and at the hearing, I am reducing this allegation of violation to a NOA and its\ndisposition will be addressed in the Amendment of Procedures section below.\nItem 3(b) of the Notice alleged that Respondent violated 49 C.F.R. § 195.452(f)(8), as quoted\nabove, by failing to include adequate procedures and criteria for qualifying personnel to perform\nreviews of integrity assessment results. At the hearing, ExxonMobil pointed out that this item\nsolely involved written procedures which were under revision during the relevant period. After\nconsidering the information provided by Respondent in its Response and at the hearing, I am\nreducing this allegation of violation to a NOA and its disposition will be addressed in the\nAmendment of Procedures section below.\nItem 5: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(e)(1), which states:\n§ 195.452 Pipeline integrity management in high\nconsequence areas.\n(a) . . . .\n(e) What are the risk factors for establishing an assessment\nschedule (for both the baseline and continual integrity assessments)? (1)\nAn operator must establish an integrity assessment schedule that\nprioritizes pipeline segments for assessment (see paragraphs (d)(1) and\n(j)(3) of this section). An operator must base the assessment schedule on\nall risk factors that reflect the risk conditions on the pipeline segment. The\nfactors an operator must consider include, but are not limited to:\n(i) Results of the previous integrity assessment, defect type and\nsize that the assessment method can detect, and defect growth rate;\n(ii) Pipe size, material, manufacturing information, coating type\nand condition, 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\n(e.g., corrosivity of soil, subsidence, climatic);\n(viii) geo-technical hazards; and\n(ix) Physical support of the segment such as by a cable suspension\nbridge.\nItem 5(b) of the Notice alleged that Respondent violated § 195.452(e) by failing to include in its\nIM program a risk analysis for some tank farms that OPS considered to include breakout tanks\nthat should have been included in the company’s IM program. In its Response and at the\nhearing, Respondent pointed out that the treatment of breakout tanks and other facilities was\n\n\n\n5\nalready being addressed under Item 1(b) below. OPS concurred. Based on this information, I\nhereby withdraw this allegation of violation.\nItem 5(d) of the Notice alleged that Respondent violated § 195.452(e) by failing to include a\ncomplete process for documenting any changes to the risk model and/or risk evaluation process.\nAt the hearing, ExxonMobil pointed out that this item solely involved written procedures which\nwere under revision during the relevant period. After considering the information provided by\nRespondent in its Response and at the hearing, I am reducing this allegation of violation to a\nNOA and its disposition will be addressed in the Amendment of Procedures section below.\nItem 6: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(i)(1), which states:\n§ 195.452 Pipeline integrity management in high\nconsequence areas.\n(a) . . . .\n(i) What preventive and mitigative measures must an operator take\nto protect the high consequence area? (1) General requirements. An\noperator must take measures to prevent and mitigate the consequences of a\npipeline failure that could affect a high consequence area. These measures\ninclude conducting a risk analysis of the pipeline segment to identify\nadditional actions to enhance public safety or environmental protection.\nSuch actions may include, but are not limited to, implementing damage\nprevention best practices, better monitoring of cathodic protection where\ncorrosion is a concern, establishing shorter inspection intervals, installing\npressure and detect leaks, providing additional training to personnel on\nresponse procedures, conducting drills with local emergency responders\nEFRDs3 on the pipeline segment, modifying the systems that monitor\nand adopting other management controls.\nItem 6(a) of the Notice alleged that Respondent violated § 195.452(i)(1) by failing to adopt\nadequate procedures for establishing and evaluating preventive and mitigative measures. At the\nhearing, ExxonMobil pointed out that this item solely involved written procedures which were\nunder revision during the relevant period. After considering the information provided by\nRespondent in its Response and at the hearing, I am reducing this allegation of violation to a\nNOA and its disposition will be addressed in the Amendment of Procedures section below.\nItem 6(c) of the Notice alleged that Respondent violated § 195.452(i)(1) by failing to adopt\nadequate procedures for evaluating the use of leak detection and/or EFRD capability to mitigate\nrisks. At the hearing, ExxonMobil pointed out that this item solely involved written procedures\nwhich were under revision during the relevant period. After considering the information\nprovided by Respondent in its Response and at the hearing, I am reducing this allegation of\nviolation to a NOA and its disposition will be addressed in the Amendment of Procedures section\nbelow.\n3 Emergency flow restricting devices. See 49 C.F.R. § 195.450.\n\n\n\n6\nItem 7(b): The Notice alleged that Respondent violated 49 C.F.R. § 195.452(f)(7), as quoted\nabove, by failing to adopt adequate procedures for evaluating the effectiveness of the IM\nprogram and documenting the evaluations. At the hearing, ExxonMobil pointed out that this\nitem solely involved written procedures which were under revision during the relevant period.\nAfter considering the information provided by Respondent in its Response and at the hearing, I\nam reducing this allegation of violation to a NOA and its disposition will be addressed in the\nAmendment of Procedures section below.\nItem 9: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(l)(1), which states:\n§ 195.452 Pipeline integrity management in high\nconsequence areas.\n(a) . . . .\n(1) What records must be kept? (1) An operator must\nmaintain for review during an inspection:\n(i) A written integrity management program in\naccordance with paragraph (b) of this section.\n(ii) Documents to support the decisions and analyses, including\nany modifications, justifications, variances, deviations and determinations\nmade, and actions taken, to implement and evaluate each element of the\nintegrity management program listed in paragraph (f) of this section.\nItem 9(a) of the Notice alleged that Respondent violated § 195.452(l)(i) by failing to adopt\nadequate procedures for identifying which IMP documents and records are to be maintained and\ntheir retention period. At the hearing, ExxonMobil pointed out that this item solely involved\nwritten procedures which were under revision during the relevant period. After considering the\ninformation provided by Respondent in its Response and at the hearing, I am reducing this\nallegation of violation to a NOA and its disposition will be addressed in the Amendment of\nProcedures section below.\nItem 9(b) of the Notice alleged that Respondent violated § 195.452(l)(i) by failing to adopt\nadequate procedures for documenting and tracking changes to its written IM plan and any\ndeviations or modifications during implementation of plan elements. At the hearing,\nExxonMobil pointed out that this item solely involved written procedures which were under\nrevision during the relevant period. After considering the information provided by Respondent\nin its Response and at the hearing, I am reducing this allegation of violation to a NOA and its\ndisposition will be addressed in the Amendment of Procedures section below.\nItem 11: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(c)(1), which states:\n§ 195.452 Pipeline integrity management in high\nconsequence areas.\n(a) . . . .\n(c) What must be in the baseline assessment plan? (1) An operator\n\n\n\n7\nmust include each of the following elements in its written baseline\nassessment 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; . . . .\nItem 11 of the Notice alleged that Respondent violated § 195.452(c)(1) by failing to use a\ngeometry tool capable of detecting and identifying deformation anomalies in conducting its\nbaseline assessment. In its Response and at the hearing, ExxonMobil acknowledged that the data\nit used in its baseline assessment was incomplete due to the lack of a geometry tool run and that\nthis was not consistent with the regulation. Respondent provided additional information and\nexplanations regarding the proposed penalty amount, which will be discussed in the Assessment\nof Penalty section below. Accordingly, after considering all of the evidence, I find that\nRespondent violated 49 C.F.R. § 195.452(c)(1) by failing to use a geometry tool capable of\ndetecting and identifying deformation anomalies in conducting its baseline assessments.\nItem 12(a): Item 12(a) of the Notice alleged that Respondent violated 49 C.F.R. § 195.452(f), as\nquoted above, by failing to document a process for integrating all available information about the\nintegrity of the pipeline in its risk analysis. In its Response and at the hearing, Respondent\npointed out that the integration of information was already being addressed under Item 8 below.\nOPS concurred. Based on this information, I hereby withdraw this allegation of violation.\nItem 12(b): The Notice alleged that Respondent violated 49 C.F.R. § 195.452(f), as quoted\nabove, by failing to document training requirements for individuals with key risk analysis\nresponsibilities. In its Response and at the hearing, Respondent pointed out that the training of\nindividuals with risk analysis responsibilities was already being addressed under Item 3(a)\nbelow. OPS concurred. Based on this information, I hereby withdraw this allegation of\nviolation.\nItem 12(c): The Notice alleged that Respondent violated 49 C.F.R. § 195.452(f), as quoted\nabove, by failing to adopt adequate procedures for reviewing and updating assumptions that were\nbeing used in the risk analysis. At the hearing, ExxonMobil pointed out that this item solely\ninvolved written procedures which were under revision during the relevant period. After\nconsidering the information provided by Respondent in its Response and at the hearing, I am\nreducing this allegation of violation to a NOA and its disposition will be addressed in the\nAmendment of Procedures section below.\nItem 12(e): The Notice alleged that Respondent violated 49 C.F.R. § 195.452(f), as quoted\nabove, by failing to adopt adequate procedures for communicating the results of the company’s\nown Performance Evaluation process within the company. At the hearing, ExxonMobil pointed\n\n\n\n8\nout that this item solely involved written procedures which were under revision during the\nrelevant period. After considering the information provided by Respondent in its Response and\nat the hearing, I am reducing this allegation of violation to a NOA and its disposition will be\naddressed in the Amendment of Procedures section below.\nItem 12(g): The Notice alleged that Respondent violated 49 C.F.R. § 195.452(f), as quoted\nabove, by failing to adopt adequate procedures for integrating other information with assessment\nresults when formulating remediation plans. At the hearing, ExxonMobil pointed out that this\nitem solely involved written procedures which were under revision during the relevant period.\nAfter considering the information provided by Respondent in its Response and at the hearing, I\nam reducing this allegation of violation to a NOA and its disposition will be addressed in the\nAmendment of Procedures section below.\nThe findings of violation for Items 1(c) and 11 will be considered prior offenses in any\nsubsequent enforcement action taken against Respondent.\nASSESSMENT OF PENALTY\nUnder 49 U.S.C. § 60122, Respondent is subject to an administrative civil penalty not to exceed\n$100,000 per violation for each day of the violation, up to a maximum of $1,000,000 for any\nrelated series of violations.\n49 U.S.C. § 60122 and 49 C.F.R. § 190.225 require that, in determining the amount of the civil\npenalty, I consider the following criteria: the nature, circumstances, and gravity of the violation,\nincluding adverse impact on the environment; the degree of Respondent’s culpability; the history\nof Respondent’s prior offenses; the Respondent’s ability to pay the penalty and any effect that\nthe penalty may have on its ability to continue doing business; and the good faith of Respondent\nin attempting to comply with the pipeline safety regulations. In addition, I may consider the\neconomic benefit gained from the violation without any reduction because of subsequent\ndamages, and such other matters as justice may require.\nWith respect to Item 1(c), the Notice proposed a civil penalty of $5,000 for Respondent’s failure\nto have a segment identification process in place sufficient to ensure that all segments that could\naffect an HCA were covered by its IM program, in accordance with § 195.452(f)(1). The\nsegment identification process is a key part of an IM program and forms the foundation for\nfurther stages of implementation. The failure to properly conduct the segment identification\nprocess has the potential to compromise the effectiveness of the entire program.\nIn its Response and at the hearing, ExxonMobil acknowledged that it had not completed a risk-\nbased listing of its “could affect” segments by the December 31, 2001 deadline, but contended\nthat the civil penalty amount of $5,000 proposed in the Notice was unwarranted because the\ncompany had misinterpreted the requirement as permitting an operator to treat all of its pipeline\nsegments as “could affect” segments. Such an interpretation, however, is not supported by the\nregulatory text and is not consistent with the principles of risk management, which necessarily\n\n\n\n9\ninvolve the prioritization of risk. Respondent also stated that during the relevant time period,\nExxonMobil U.S. East Production Company and ExxonMobil U.S. West Production Company\nwere consolidated, as were their two separate IM programs. Organizational changes, however,\nare common in the pipeline industry and PHMSA has never accepted organizational changes as a\njustification for failure to meet compliance deadlines. Respondent has presented no information\nthat would warrant a reduction in the civil penalty amount proposed in the Notice for this\nviolation. Accordingly, having reviewed the record and considered the assessment criteria, I\nassess Respondent a civil penalty of $5,000 for violating 49 C.F.R. § 195.452(f)(1).\nWith respect to Item 11, the Notice proposed a civil penalty of $10,000 for ExxonMobil’s failure\nto use a geometry tool capable of detecting and identifying deformations in conducting its\nbaseline assessments in accordance with § 195.452(c)(1). Use of appropriate assessment\nmethods and tools is a key part of thoroughly assessing the risks on a pipeline. Under the\nregulation, use of a geometry tool in addition to metal-loss and other tools is required to identify\ndents and other deformation anomalies.\nIn its Response and at the hearing, ExxonMobil acknowledged that a geometry tool run was not\nperformed during the relevant time period, but contended that the $10,000 civil penalty\nproposed in the Notice was unwarranted because the company had voluntarily implemented\nintegrity measures, prior to adoption of the integrity management rule, for the SYU 02 pipeline\nincluding span analysis, ROV surveys, and in-line inspections. Respondent also stated that the\ninclusion of the SYU 02 pipeline in its IM program was not necessary in order for the company\nto meet the 2004 mileage requirement. In addition, ExxonMobil noted that the company had\nremedied the situation in 2006 by running a full suite of in-line inspection tools, including a\ngeometry tool.\nThe performance of other in-line inspection surveys, however, does not mitigate the failure to\nuse a geometry tool as part of its initial assessment process. The use of a geometry tool is a key\npart of detecting deformation anomalies as part of conducting meaningful pipeline assessments.\nRespondent admits that it did not use a geometry tool until 2006, well after receiving the Notice\nin this enforcement proceeding. Respondent has presented no information that would warrant a\nreduction in the civil penalty amount proposed in the Notice for this violation. Accordingly,\nhaving reviewed the record and considered the assessment criteria, I assess Respondent a civil\npenalty of $10,000 for violating 49 C.F.R. § 195.452(c)(1).\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a total civil penalty of $15,000.\nPayment of the civil penalty must be made within 20 days of service. Federal regulations (49\nC.F.R. § 89.21(b)(3)) require this payment be made by wire transfer, through the Federal\nReserve Communications System (Fedwire), to the account of the U.S. Treasury. Detailed\ninstructions are contained in the enclosure. Questions concerning wire transfers should be\ndirected to: Financial Operations Division (AMZ-341), Federal Aviation Administration, Mike\nMonroney Aeronautical Center, P.O. Box 25082, Oklahoma City, OK 73125; (405) 954-8893.\n\n\n\n10\nFailure to pay the $15,000 civil penalty will result in accrual of interest at the current annual rate\nin accordance with 31 U.S.C. § 3717, 31 C.F.R. § 901.9 and 49 C.F.R. § 89.23. Pursuant to\nthose same authorities, a late penalty charge of six percent (6%) per annum will be charged if\npayment is not made within 110 days of service. Furthermore, failure to pay the civil penalty\nmay result in referral of the matter to the Attorney General for appropriate action in a United\nStates District Court.\nCOMPLIANCE ORDER\nThe Notice proposed a Compliance Order with respect to Items 1(a), 1(d), 2(a), 2(b), 3(b), 5(b),\n5(d), 6(a), 6(c), 7(b), 9(a), 9(b), 11, 12(c), 12(e), and 12(g) in the Notice for the violations\ndescribed above. Item 5(b) has now been withdrawn and therefore will not be a subject of this\nCompliance Order. Items 1(a), 1(d), 2(a), 2(b), 3(b), 5(d), 6(a), 6(c), 7(b), 9(a), 9(b), 12(c),\n12(e), and 12(g) have been reduced to NOA items and their disposition will be addressed in the\nAmendment of Procedures section below.\nWith respect to the remaining item for which a Compliance Order was proposed, under 49\nU.S.C. § 60118(a), each person who engages in the transportation of hazardous liquids or who\nowns or operates a pipeline facility is required to comply with the applicable safety standards\nestablished under chapter 601.\nWith respect to Item 11, Respondent provided information demonstrating that it ran a full suite\nof in-line inspection tools, including a geometry tool in 2006. Since compliance has been\nachieved with respect to this violation, it is unnecessary to include compliance terms in this\nOrder.\nAMENDMENT OF PROCEDURES\nWith respect to Items 1(b), 3(a), 3(c), 4, 7(a), 8, 10, 12(f), 12(i), and 13, the Notice alleged\ninadequacies in Respondent’s operating and maintenance procedures and proposed to require\namendment of the company’s procedures to comply with the requirements of 49 C.F.R. § 195.\nIn its Response and at the hearing, ExxonMobil pointed out that the issue in Item 12(f) was\nalready being addressed under Item 2(a). OPS concurred. Based on this information, I am\nwithdrawing Item 12(f). As indicated above, Items 1(a), 1(d), 2(a), 2(b), 3(b), 5(d), 6(a), 6(c),\n7(b), 9(a), 9(b), 12(c), 12(e), and 12(g) will also be addressed in this section as NOA items.\nSpecifically, the Notice alleged the following inadequacies in Respondent’s IM procedures as\nthey existed at the time of the inspection:\nItem 1(a) alleged that Respondent did not adopt adequate procedures for collecting,\ncommunicating, recording, and using field input in its segment identification process.\nItem 1(d) alleged that Respondent did not adopt adequate procedures for the segment\nidentification revision process.\n\n\n\n11\nItem 2(a) alleged that Respondent did not adopt adequate procedures specifying and\ntechnically justifying the choice of assessment methods to be used for each pipeline\nsegment.\nItem 2(b) alleged that Respondent did not adopt adequate procedures for the baseline\nassessment plan revision process.\nItem 3(c) alleged that Respondent’s procedures for obtaining and analyzing the\nsignificance of the data from its ILI tool vendors were inadequate.\nItem 4 alleged that Respondent’s procedures for documenting the cause of hydrostatic\ntest failures and tracking the adequacy of corrective actions were inadequate.\nItem 5(d) alleged that Respondent did not adopt an adequate process for documenting any\nchanges to the risk model and/or risk evaluation process.\nItem 6(a) alleged that Respondent did not adopt adequate procedures for establishing and\nevaluating preventive and mitigative measures.\nItem 6(c) alleged that Respondent did not adopt adequate procedures for evaluating the\nuse of leak detection and/or EFRD capability to mitigate risks.\nItems 7(a)-(b) alleged that Respondent’s process and criteria for evaluating its IM\nprogram and its procedures for documenting and communicating the effectiveness of its\nIM program were inadequate.\nItem 8 alleged that Respondent’s procedures for integrating and analyzing data gathered\nin conjunction with other inspections, tests, and monitoring (such as cathodic protection)\nrequired by Part 195 in establishing its ongoing reassessment interval were inadequate.\nItem 9(a) alleged that Respondent did not adopt adequate procedures for identifying\nwhich IM program documents and records were to be maintained and their retention\nperiod.\nItem 9(b) alleged that Respondent did not adopt adequate procedures for documenting\nand tracking changes to its written IM plan and any deviations or modifications during\nimplementation of plan elements.\nItem 10 alleged that Respondent’s procedures for adding or removing pipeline segments\nfrom its IMP asset inventory and documenting the basis for doing so were inadequate.\nItem 12(c) alleged that Respondent did not adopt adequate procedures for reviewing and\nupdating the assumptions being used in its risk analysis.\n\n\n\n12\nItem 12(e) alleged that Respondent did not adopt adequate procedures for communicating\nthe results of the Performance Evaluation within the company.\nItem 12(g) alleged that Respondent did not adopt adequate procedures for integrating\nother information with assessment results when formulating remediation plans.\nItem 12(i) alleged that Respondent did not adequately document its process for\nintegrating all available information about the integrity of the entire pipeline and the\nconsequences of a failure; and\nItem 13 alleged that Respondent’s procedures for determining the date of discovery of a\ncondition that presents a potential threat to the integrity of the pipeline and for\ndetermining what remedial actions should be taken when more than 180 days have\nelapsed since the date of discovery were inadequate.\nIn its Response and at the hearing, Respondent provided information concerning the revisions it\nmade to its procedures following the inspection, including copies of relevant portions of the 2006\nmanual. The Director reviewed the revised procedures and determined that the inadequacies\nidentified in these Notice items had been satisfactorily addressed. Accordingly, I find that\nRespondent’s procedures as described in Items 1(a), 1(d), 2(a), 2(b), 3(c), 4, 5(d), 6(a), 6(c), 7(a)-\n(b), 8, 9(a), 9(b), 10, 12(c), 12(e), 12(i) and 13 in the Notice were inadequate to ensure safe\noperation of its pipeline system, but that Respondent has corrected the identified inadequacies.\nWith respect to Item 1(b), the Notice alleged that Respondent’s procedures for including an\nevaluation of the potential effects of failures at certain pipeline facilities such as pump stations\nand tank farms in its segment identification process were inadequate. In its Response and at the\nhearing, Respondent stated that it had reevaluated the status of certain tanks associated with the\nSYU02 pipeline and that it believed the treatment of these tanks as breakout tanks was no longer\nwarranted.\nAlthough Respondent submitted amended procedures to the Director, these procedures did not\ncomprehensively address all tanks, pump stations, metering stations, and other similar facilities\nand therefore did not address all of the inadequacies described in the Notice. Accordingly, I find\nthat Respondent’s procedures for including an evaluation of the potential effects of failures at\ncertain pipeline facilities such as pump stations and tank farms in its segment identification\nprocess are inadequate to ensure safe operation of its pipeline system.\nWith respect to Items 3(a)-(b), the Notice alleged that Respondent’s procedures for the\nperformance of integrity assessment result reviews were inadequate and failed to include\ncomplete procedures and criteria for qualifying personnel to perform these reviews and maintain\nsuch qualification. Although Respondent submitted amended procedures to the Director, as\nreflected in the 2006 manual, these procedures did not address all of the inadequacies described\nin the Notice. Accordingly, I find that Respondent’s procedures for the performance of integrity\nassessment result reviews are inadequate to ensure safe operation of its pipeline system.\n\n\n\n13\nWith respect to Item 12(g), the Notice alleged that Respondent failed to adopt adequate\nprocedures for integrating other information with assessment results when formulating\nremediation plans. In its Response and at the hearing, Respondent stated that Article 7.5.6 of its\n2004 IM program set forth a process involving the integration of information. OPS pointed out\nthat as they existed in the 2004 IM program, the procedures failed to include sufficient detail to\nprovide for integrating the assessment results with all other available information when\nformulating remediation plans. Accordingly, I find that Respondent’s procedures for integrating\nother information with assessment results when formulating remediation plans are inadequate to\nensure safe operation of its pipeline system.\nPursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.237, Respondent is ordered to revise its\nprocedures as follows:\n1. With respect to Item 1(b), amend the procedures to include an evaluation of the\npotential effects of failures at pipeline facilities such as pump stations and tank farms\nin its segment identification process;\n2. With respect to Items 3(a)-(b), amend the procedures for the performance of integrity\nassessment result reviews to include adequate procedures and criteria for qualifying\npersonnel to perform these reviews and maintain such qualifications;\n3. With respect to item 12(g), amend the procedures to establish a process to integrate\nother information with assessment results when formulating remediation plans; and\n4. Submit copies of the amended procedures for Items 1(b), 3(a)-(b), and 12(g) to the\nDirector within 30 days following receipt of this Order.\nWARNING ITEMS\nWith respect to Items 3(d), 5(a), 5(c), 5(e), 6(b), 12(d), 12(h), and 12(j), the Notice alleged\nprobable violations of Part 195 but did not propose a civil penalty or Compliance Order for these\nitems. Therefore, these items are considered to be warning items. The warnings were for:\n49 C.F.R. § 195.452(f)(8) (Notice Item 3(d)) ─ Respondent’s alleged failure to include a\nsufficiently detailed process for distribution and review of integrity assessment results;\n49 C.F.R. § 195.452(e)(1) (Notice Item 5(a)) ─ Respondent’s alleged failure to\ncomprehensively document its risk analysis;\n49 C.F.R. § 195.452(e)(1) (Notice Item 5(c)) ─ Respondent’s alleged failure to include a\nreview process for populating the risk model data fields using available records and input\nfrom its subject matter experts;\n\n\n\n14\n49 C.F.R. § 195.452(e)(1) (Notice Item 5(e)) ─ Respondent’s alleged failure to perform\nquality control sufficient to ensure that the risk factors included in its risk model database\nfully correspond with field data and conditions;\n49 C.F.R. § 195.452(i)(1) (Notice Item 6(b)) ─ Respondent’s alleged failure to include\nHCA specific risk drivers in its process for developing preventative and mitigative\nmeasures;\n49 C.F.R. § 195.452(f) (Notice Item 12(d)) ─ Respondent’s alleged failure to include a\nprocess ensuring that ILI tool vendors relay preliminary notifications of immediat","truncated":true,"body_characters":41550}