AMERIGAS EAGLE PROPANE LP — Notice of Probable Violation

party submissionOfficial PDF520070022_operator response to notice_11162007.pdf#

520070022_FinalOrder_12202010_text.pdf, page 1Official PDFDEC 20 2010 Mr. Ron Templeman General Manager Amerigas Eagle Propane, L.P. 91-280 Hanua Street Kapolei, HI 96707-1783 Re: CPF No. 5-2007-0022 Dear Mr. Templeman: Enclosed please find the Final Order issued in the above-referenced case. It withdraws one of the allegations of violation, makes two findings of violation, and finds that Amerigas Eagle Propane, L.P., has completed the actions specified in the Notice to comply with the pipeline safety regulations. Therefore, this case is now closed. Service of the Final Order by certified mail is deemed effective upon the date of mailing, or as otherwise provided under 49 C.F.R. § 190.5. Thank you for your cooperation in this matter. Sincerely, Jeffrey D. Wiese Associate Administrator for Pipeline Safety Enclosure cc: Mr. Chris Hoidal, Director, Western Region, PHMSA CERTIFIED MAIL – RETURN RECEIPT REQUESTED [7005 1160 0001 0041 0794]#

520070022_FinalOrder_12202010_text.pdf, page 2U.S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY WASHINGTON, D.C. 20590 ____________________________________ In the Matter of ) Amerigas Eagle Propane, L.P., ) CPF No. 5-2007-0022 ) ) ) Respondent. ) ____________________________________) FINAL ORDER On November 13, 2006, pursuant to 49 U.S.C. § 60117, a representative of the Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS), conducted an on-site pipeline safety inspection of the facilities and records of Amerigas Eagle Propane, L.P. (Amerigas or Respondent), in Kapolei, Hawaii. Amerigas operates propane distribution systems on the island of Oahu. systems at shopping centers on Oahu. 1 OPS’s inspection included a visit to three of those As a result of the inspection, the Director, Western Region, OPS (Director), issued to Respondent, by letter dated October 19, 2007, a Notice of Probable Violation and Proposed Compliance Order (Notice). In accordance with 49 C.F.R. § 190.207, the Notice proposed finding that Amerigas had committed three violations of 49 C.F.R. Parts 191 and 192 and proposed ordering Respondent to take certain measures to correct the alleged violations. Amerigas responded to the Notice by letter dated November 16, 2007 (Response). The company contested the allegations and offered additional information in response to the Notice. Respondent did not request a hearing and therefore has waived its right to one. FINDINGS OF VIOLATION The Notice alleged that Respondent violated 49 C.F.R. Parts 191 and 192, as follows: Item 1: The Notice alleged that Respondent violated 49 C.F.R. § 191.1, which states in relevant part: 1 Amerigas affiliates operate propane distribution systems on the islands of Maui and Hawaii.#

520070022_FinalOrder_12202010_text.pdf, page 32 § 191.1 Scope. (a) This part prescribes requirements for the reporting of incidents, safety-related conditions, and annual pipeline summary data by operators of gas pipeline facilities located in the United States or Puerto Rico, including pipelines within the limits of the Outer Continental Shelf as that term is defined in the Outer Continental Shelf Lands Act (43 U.S.C. 1331). The Notice alleged that Amerigas had never submitted an annual report and had no operations and maintenance manual. In its Response, Amerigas objected to the allegation of violation and stated that: 1) It operates a limited number of propane distribution systems in Hawaii that are subject to PHMSA’s jurisdiction, but that “none of those systems services 100 customers or more from a single source.” 2) Section 191.1 “is simply a description of scope, and it does not contain any specific requirements.” 3) The OPS inspector did not request any documentation of compliance with the Part 191 reporting requirements. 4) The company had an operations and maintenance manual available at the time of the inspection. Per § 191.11(b), “The annual report required by this section need not be submitted with respect to . . . petroleum gas systems which serve fewer than 100 customers from a single source.” Amerigas stated that it is an operator of a petroleum gas system which serves fewer than 100 customers from a single source, and OPS has provided no evidence to the contrary. In the absence of such evidence, I cannot conclude that Amerigas is subject to the reporting requirements of § 191.11. Further, as Amerigas stated, § 191.1 does not contain any specific requirements; rather, it describes, in broad terms, the scope of Part 191. Accordingly, the substance of the allegations in the Notice does not correspond to the regulation cited, and I cannot find that Respondent violated § 191.1. Based on the foregoing, I order that Item 1 be withdrawn. Item 2: The Notice alleged that Respondent violated 49 C.F.R. §§ 192.603§ 192.605, which states in relevant part: § 192.603 General Provisons. (a) . . . . (b) Each operator shall keep records necessary to administer the procedures established under § 192.605. (c) . . . .#

520070022_FinalOrder_12202010_text.pdf, page 43 § 192.605 Procedural manual for operations, maintenance, and emergencies. (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. . . . (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) . . . . (d) Safety-related condition reports. The manual required by paragraph (a) of this section must include instructions enabling personnel who perform operation and maintenance activities to recognize conditions that potentially may be safety-related conditions that are subject to the reporting requirements of § 191.23 of this subchapter. (e) Surveillanace, emergency respondse, and accident investigation. The procedures required by §§ 192.613(a), 192.615, and 192.617 must be included in the manual required by paragraph (a) of this section. In particular, the Notice alleged that Respondent violated 49 C.F.R §§ 192.603(b) and 192.605(a)-(b) and (d)-(e) by failing to develop an adequate manual of operations and maintenance procedures for its propane distribution systems and to keep the records necessary to administer those procedures. Amerigas provided a copy of its operations and maintenance manual with its Response and stated that the alleged violation lacked merit. The operations and maintenance manual submitted by Respondent bears an effective date of October 10, 2007, almost 11 months after the OPS inspection. That manual also replaced the version that had been in effect since June 1, 1998, thereby indicating that it had not been revised for more than eight years at the time of the OPS inspection. In addition, Respondent has not introduced any records necessary for the proper administration of the procedures in its manual, and an Amerigas employee told the OPS inspector “that [the] records necessary for compliance with [its] written procedures . . . ha[d] never existed.”2 Accordingly, after considering all of the evidence, I find that Respondent violated 49 C.F.R. §§ 192.603(b) and 192.695(a)-(b) and (d)-(e) by failing to develop an adequate manual of operations and maintenance procedures for its propane distribution systems and to keep the records necessary to administer those procedures. Item 3: The Notice alleged that Respondent violated 49 C.F.R. § 192.614, which states in relevant part: § 192.614 Damage prevention program. (a) Except as provided in paragraphs (d) and (e) of this section, each operator of a buried pipeline must carry out, in accordance with this section, a written program to prevent damage to that pipeline from excavation activities. . . . 2 OPS Violation Report at 4.#

520070022_FinalOrder_12202010_text.pdf, page 54 The Notice alleged that Respondent violated 49 C.F.R. § 192.614 by failing to carry out a damage prevention program, as demonstrated by the absence of any records. In its Response, Amerigas stated that the OPS inspector did not request any records related to its damage prevention program, and that it had procedures for carrying out that program in its operations and maintenance manual. Respondent submitted its O&M manual with its Response, and stated that Section 5.3, entitled Damage Prevention Program, demonstrated its compliance with § 192.614. The O&M manual that Respondent submitted contains markings on each page indicating an effective date of October 10, 2007. These markings also indicate that this version of the O&M manual replaced a version dated June 1, 1998. The effective date of the O&M manual was nearly a year after the date of the inspection. Although this version of the manual is probative for the purposes of determining whether Respondent satisfied the terms of the compliance order, it does not provide evidence that Respondent had an adequate damage prevention program at the time of the inspection. Thus, Respondent provided no evidence that it had a damage prevention program in place at the time of the inspection. Accordingly, after considering all of the evidence, I find that Respondent violated 49 C.F.R. § 192.614(a) by failing to carry out a damage prevention program. This finding of violation will be considered a prior offense in any subsequent enforcement action taken against Respondent. COMPLIANCE ORDER The Notice proposed a compliance order with respect to Items 1, 2, and 3 in the Notice for violations of 49 C.F.R. §§ 191.1, 192.605, and 192.614, respectively. 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. Because I ordered that Items 1 and 2 be withdrawn, the compliance terms proposed in the Notice as to those Items are not included in this Order. The Director indicates that Respondent has taken the following actions specified in the proposed compliance order: 1. With respect to the violation of §§ 192.603(b) and 192.695(a)-(b) and (d)-(e) (Item 2), a December 2008 OPS inspection confirmed that Respondent has developed a sufficient manual of operations and maintenance procedures for its propane distribution systems and for keeping the records necessary to administer those procedures. 2. With respect to the violation of §192.614 (Item 3), Respondent has submitted a written damage prevention.#

520070022_FinalOrder_12202010_text.pdf, page 65 Accordingly, I find that compliance has been achieved with respect to these violations. Therefore, the compliance terms proposed in the Notice for Item 2 and 3 are not included in this Order. 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 sent to: Associate Administrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey Avenue, SE, East Building, 2nd Floor, Washington, DC 20590, with a copy sent to the Office of Chief Counsel, PHMSA, at the same address. PHMSA will accept a petition received no later than 20 days after receipt of this Final Order by the Respondent, provided it contains a brief statement of the issue(s) and meets all other requirements of 49 C.F.R. § 190.215. Unless the Associate Administrator, upon request, grants a stay, the terms and conditions of this Final Order are effective upon service in accordance with 49 C.F.R. § 190.5. ___________________________________ __________________________ Jeffrey D. Wiese Date Issued Associate Administrator for Pipeline Safety#

520070022_nopv pco letter_10192007_text.pdf, page 1Official PDFSENT T't ~ C(. 'Mt'LtaNt 'E kEGtST Hardcopy t. . 'lect ron tcally ¹ of Cop~es L! Date ~1+ 'ito f 1papp W Dakota Ave Suite 11p Lakewood, CO Sp2&& U. S. Department of Transportation Pipeline and Hazardous Materials Safety Administration NOTICE OF PROBABLE VIOLATION and PROPOSED COMPLIANCE ORDER CERTIFIED MAIL - RETURN RECEIPT RE UESTED October 19, 2007 Mr. Ron Templeman, P. E. Amerigas Propane 91 — 290 Hanua Street Kapolei, HI 96707-1783 CPF 5-2007-0022 Dear Mr. Templeman: On November 13, 2006, a representative of the Pipeline and Hazardous Materials Safety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code, inspected your distribution facilities in Kapolei, Hawaii. As a result of the inspection, it appears that you have committed a probable violation of the Pipeline Safety Regulations, Title 49, Code of Federal Regulations. The items inspected and the probable violations are: $191. 1 Scope (a) This part prescribes requirements for the reporting of incidents, safety-related conditions, and annual pipeline summary data by operators of gas pipeline facilities located in the United States or Puerto Rico, including pipelines within the limits of the Outer Continental Shelf as that term is defined in the Outer Continental Shelf Lands Act t43 U. S. C. 1331].#

520070022_nopv pco letter_10192007_text.pdf, page 2Records were unavailable at the time of the inspection to substantiate compliance with this section. Amerigas has never submitted an Annual Report, and acknowledged that Operation and Maintenance procedures have never been initiated. $192. 605 Procedural manual for operations, maintenance, and emergencies Each operator shall include the following in its operating and maintenance plan: (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 include procedures for handling abnormal operations. This manual must be reviewed and updated by the operator at intervals not exceeding 15 months, but at least one each calendar year. This manual must be prepared before operations of a pipeline system commence. Appropriate parts of the manual must be kept at locations where operations and maintenance activities are conducted. (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 pipeline in accordance with each of the requirements of this subpart and Subpart M of this part. (2) Controlling corrosion in accordance with the operations and maintenance requirements of Subpart I of this part. (3) Making construction records, maps, and operating history available to appropriate operating personnel. (4) Gathering of data needed for reporting incidents under Part 191 of this chapter in a timely and effective manner. (5) Starting up and shutting down any part of the pipeline in a manner designed to assure operation within the MAOP limits prescribed by this part, plus the build-up allowed for operation of pressure-limiting and control devices. (6) Maintaining compressor stations, including provisions for isolating units or sections of pipe and for purging before returning to service. (7) Starting, operating and shutting down gas compressor units. (8) Periodically reviewing the work done by operator personnel to determine the effectiveness and adequacy of the procedures used in normal operation and maintenance and modifying the procedure when deficiencies are found. (9) Taking adequate precautions in excavated trenches to protect personnel from the hazards of unsafe accumulations of vapor or gas, and making available when needed at the excavation, emergency rescue equipment, including a breathing apparatus and, a rescue harness and line. (10) Systematic and routine testing and inspection of pipe-type or bottle-type holders including- (i) Provision for detecting external corrosion before the strength of the container has been impaired;#

520070022_nopv pco letter_10192007_text.pdf, page 3(ii) Periodic sampling and testing of gas in storage to determine the dew point of vapors contained in the stored gas which, if condensed, might cause internal corrosion or interfere with the safe operation of the storage plant; and, (iii) Periodic inspection and testing of pressure limiting equipment to determine that it is in safe operating condition and has adequate capacity. (11) Responding promptly to a report of a gas odor inside or near a building, unless the operator's emergency procedures under $192. 615(a)(3) specifically apply to these reports. (c) Safety-related condition reports. The manual required by paragraph (a) of this section must include instructions enabling personnel who perform operation and maintenance activities to recognize conditions that potentially may be safety-related conditions that are subject to the reporting requirements of $191. 23 of this subchapter. (d) Surveillance, emergency response, and accident investigation. The procedures required by $/192. 613(a), 192. 615, and 192. 617 must be included in the manual required by paragraph (a) of this section. When Operation and Mamtenance procedures are developed in accordance with $192. 603, Amerigas must maintain records to admmister these procedures for operation of its pipeline system. 3. $192. 614 Damage prevention program (a) Except for pipelines listed in paragraphs (d) and (e) of this section, each operator of a buried pipeline shall carry out in accordance with this section a written program to prevent damage to that pipeline by excavation activities. For the purpose of this section, "excavation activities" include excavation, blasting, boring, tunneling, backfilling, the removal of above ground structures by either explosive or mechanical means, and other earth moving operations. An operator may perform any of the duties required by paragraph (b) of this section through participation in a public service program, such as a "one-call" system, but such participation does not relieve the operator of responsibility for compliance with this section. (b) An operator may comply with any of the requirements of paragraph (c) of this section through participation in a public service program, such as a one-call system, but such participation does not relieve the operator of responsibility for compliance with this section. However, an operator must perform the duties of paragraph (c)(3) of this section through participation in a one-call system, if that one-call system is a qualified one-call system. In areas that are covered by more than one qualified one-call system, an operator need only join one of the qualified one-call systems if there is a central telephone number for excavators to call for excavation activities, or if the one-call systems in those areas communicate with one another. An operator's pipeline system must be covered by a qualified one-call system where there is one in place. For the purpose of this section, a one-call system#

520070022_nopv pco letter_10192007_text.pdf, page 4is considered a "qualified one-call system" if it meets the requirements of section (b)(1) or (b)(2) of this section. (1) The state has adopted a one-call damage prevention program under Sec. 198. 37 of this chapter; or (2) The one-call system: (i) Is operated in accordance with Sec. 198. 39 of this chapter; (ii) Provides a pipeline operator an opportunity similar to a voluntary participant to have a part in management responsibilities; And (iii) Assesses a participating pipeline operator a fee that is proportionate to the costs of the one-call system's coverage of the operator's pipeline. (c) The damage prevention program required by paragraph (a) of this section must, at a minimum: (1) Include the identity, on a current basis, of persons who normally engage in excavation activities in the area in which the pipeline is located. (2) Provides for notification of the public in the vicinity of the pipeline and actual notification of the persons identified in paragraph (c)(1) of this section of the following as often as needed to make them aware of the damage prevention program: (i) The program's existence and purpose; and (ii) How to learn the location of underground pipelines before excavation activities are begun. (3) Provide a means of receiving and recording notification of planned excavation activities. (4) If the operator has buried pipelines in the area of excavation activity, provide for actual notification of persons who give notice of their intent to excavate of the type of temporary marking to be provided and how to identify the markings. (5) Provide for temporary marking of buried pipelines in the area of excavation activity before, as far as practical, the activity begins. (6) Provide as follows for inspection of pipelines that an operator has reason to believe could be damaged by excavation activities: (i) The inspection must be done as frequently as necessary during and after the activities to verify the integrity of the pipeline; and (ii) In the case of blasting, any inspection must include leakage surveys (d) A damage prevention program under this section is not required for the following pipelines: (1) Pipelines located offshore. (2) Pipelines, other than those located offshore, in Class 1 or 2 locations until September 20, 1995. (3) Pipelines to which access is physically controlled by the operator. (e) Pipelines operated by persons other than municipalities (including operators of master meters) whose primary activity does not include the transportation of gas need not comply with the following: (1) The requirement of paragraph (a) of this section that the damage prevention program be written; and#

520070022_nopv pco letter_10192007_text.pdf, page 5(2) The requirements of paragraphs (c)(1) and (c)(2) of this section. Records were unavailable at the time of the inspection to substantiate that a program was in place to prevent damage to its pipelines as a result of excavation. Pro osed Com liance Order Pursuant to 49 United States Code ( 60118, the Pipehne and Hazardous Materials Safety Administration proposes to issue a Compliance Order to Amerigas. Please refer to the Proposed Comphance Order that is enclosed and made a part of this Notice. Res onse to this Notice Enclosed as part of this Notice is a document entitled Response Options for Pipeline Operators in Comphance Proceedings. Please refer to this document and note the response options. Be advised that all material you submit in response to this enforcement action is subject to being made publicly available. If you beheve that any portion of your responsive material qualifies for confidential treatment under 5 U. S. C. 552(b), along with the complete original document you must provide a second copy of the document with the portions you believe qualify for confidential treatment redacted and an explanation of why you believe the redacted information quahfies for confidential treatment under 5 U. S. C. 552(b). If you do not respond within 30 days of receipt of this Notice, this constitutes a waiver of your right to contest the allegations in this Notice and authorizes the Associate Administrator for Pipeline Safety to find facts as alleged in this Notice without further notice to you and to issue a Final Order. In your correspondence on this matter, please refer to CPF 5-2007-0022 and for each document you submit, please provide a copy m electronic format whenever possible. Sincerel, Chris Hoidal Director, Western Region Pipeline and Hazardous Materials Safety Administration Enclosures: Proposed Comphance Order Response Options for Pipeline Operators in Comphance Proceedings cc: PHP-60 Comphance Registry PHP-500 J. Kenerson (¹116801)#

520070022_nopv pco letter_10192007_text.pdf, page 6PROPOSED COMPLIANCE ORDER Pursuant to 49 United States Code ) 60118, the Pipehne and Hazardous Materials Safety Administration (PHMSA) proposes to issue to Amerigas Propane a Compliance Order incorporating the following remedial requirements to ensure the compliance of Amerigas Propane with the pipeline safety regulations: In regard to Item Number 1 of the Notice pertaining to establishing procedures for reporting incidents, safety-related conditions, and annual pipeline summary data by operators of gas pipeline facilities, Amerigas must prepare, submit, and follow a written procedure. In regard to Item Number 2 of the Notice pertaining to the requirement to keep records that administer its procedures, prepare a manual of written procedures for conducting operations and maintenance activities and for emergency response, reporting incidents under Part 191, as well as all other requirements under $192. 605 applicable to Amerigas's operation, Amerigas must submit and follow written procedures to fill the requirements for conducting operations and maintenance activities and for emergency response, reporting incidents under Part 192, as well as all other requirements under 192. 605 applicable to Amerigas's operation. In regard to Item Number 3 of the Notice pertaining to establishment of a damage prevention program, Amerigas must submit a written program to prevent damage tg its pipeline by excavation activities. Amerigas Propane shall maintain documentation of the safety improvement costs associated with fulfilling this comphance Order and submit the total to Chris Hoidal, Director, Western Region, Pipeline and Hazardous Materials Safety Administration. 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.#