VENOCO, INC — Warning Letter

520082001w_warning letter_05072008_text.pdf, page 1Official PDFo U. S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 12300 W Dakota Ave, Suite 110 Lakewood, CO 80228 WARNING LETTER CERTIFIED MAIL - RETURN RECEIPT RK UKSTKD May 7, 2008 Mr. Keith Wenal Manager Venoco Inc. 6267 Carpinteria Avenue Carpinteria, CA 93013 CPF 5-2008-2001W Dear Mr. Wenal: On March 10, 2008, a representative of the Pipeline and Hazardous Materials Safety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code, inspected your procedures and records for pipeline facilities in Carpinteria, California. As a result of the inspection, it appears that you have committed probable violations of the Pipeline Safety Regulations, Title 49, Code of Federal Regulations. The item inspected and the probable violation is: $192. 463 External corrosion control: Cathodic protection (a) Each cathodic protection system required by this subpart must provide a level of cathodic protection that complies with one or more of the applicable criteria contained in Appendix D of this part. On November 10, 2007, Venoco conducted an annual cathodic protection (CP) Survey on the Platform Grace pipelines. Venoco's contractor, FarWest, used a Silver/Silver Chloride reference cell to measure CP levels on the steel gas pipelines. The criterion for CP of steel in seawater is that it must be polarized to at least -800 mv versus this type of reference cell. The pipeline was polarized to only -763 mv indicating inadequate CP.#

520082001w_warning letter_05072008_text.pdf, page 2Under 49 United States Code, $ 60122, you are subject to a civil penalty not to exceed $100, 000 for each violation for each day the violation persists up to a maximum of $1, 000, 000 for any related series of violations. We have reviewed the circumstances and supporting documents involved in this case, and have decided not to conduct additional enforcement action or penalty assessment proceedings at this time. We advise you to correct the item(s) identified in this letter. Failure to do so will result in Venoco Inc. being subject to additional enforcement action. No reply to this letter is required. If you choose to reply, in your correspondence please refer to CPF 5-200S-2001W. Be advised that all material you submit in response to this enforcement action is subject to being made publicly available. If you believe 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 qualifies for confidential treatment under 5 U. S. C. 552(b). Sincerely, C ' oidal Director, Western Region Pipeline and Hazardous Materials Safety Administration cc: PHP-60 Compliance Registry PHP-500 F. Monfared (¹120752)#