HILCORP NORTH SLOPE, LLC — Warning Letter

520085026w_warning letter_08262008_text.pdf, page 1Official PDFU. S Department of Transportation Pipelline and Hazardous Maferialls Sattefy Admilniisfrafilon 12300 W Dakota Ave, Suite 110 Lakewood, CO 80228 CERTIFIED MAIL - RETURN RECEIPT RK UESTKD August 26, 2008 Mr Anthony Brock Senior Vice President BP Exploration Alaska, Inc. 900 East Benson Boulevard Anchorage, AK 99501 CPF 5-2008-5026M Dear Mr. Brock. On February 6-7, 2008, a representative of the Pipehne and Hazardous Materials Safety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code, inspected your North Star Sales Oil Line in Prudhoe Bay, Alaska As a result of the mspection, it appears that you have committed probable violations of the Pipehne Safety Regulations, Title 49, Code of Federal Regulations. The item inspected and the probable violation is 1. $195. 420 Valve maintenance. (a) Each operator shall maintain each valve that is necessary for the safe operation of its pipeline systems in good working order at all times. (b) Each operator shall, at intervals not exceeding 7 1/2 months, but at least twice each calendar year, inspect each mainline valve to determine that it is functioning properly.#

520085026w_warning letter_08262008_text.pdf, page 2At the time of the mspection, BPXA was unable to provide the records for mainhne valve mspections during the February 2006 and March 2006 tnneframe, thus missnig the twice each calendar year requirement as required by the Pipelnie Safety Regulations, Title 49, CFR 195. 420. Although no records were provided to PHMSA for the February and March 2006 inspection periods, records were available and supphed for July 2005 and August 2005 and the subsequent inspection cycle of October 2007 and November 2007 Under 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 maxniium 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 items identified in this letter Failure to do so will result in BPXA 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 5-2008-5026M. 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 quahfies 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 potions you beheve quahfy 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) Sincerely, C Chris Hoidal Director, Western Region Pipehne and Hazardous Materials Safety Administration cc PHP-60 Comphance Registry PHP-500 R Guisinger (4118840)#