BARROW UTILITIES & ELECTRIC CORP — Notice of Amendment

party submissionOfficial PDF520110020M_operator response_01092012.pdf#

520110020M_closure letter_07032012_text.pdf, page 1Official PDFCERTIFIED MAIL - RETURN RECEIPT REQUESTED July 3, 2012 Mr. Allen Nesteby Operations Superintendent Barrow Utilities and Electric Cooperative, Inc. 1295 Agvik Street P.O. Box 449 Barrow, AK 99723 CPF 5-2011-0020M Dear Mr. Nesteby: On September 12-16, 2011, a representative from the Pipeline and Hazardous Materials Safety Administration (PHMSA), pursuant to chapter 601 of 49 United States Code, conducted an on-site pipeline safety inspection of Barrow Utilities and Electric Cooperative, Inc. (BUECI) procedures in Barrow, Alaska. As a result of the inspection, BUECI was issued a Notice of Amendment on October 25, 2011, which proposed amendment of your procedures. BUECI submitted its amended procedures on January 9, 2012. My staff reviewed the amended procedures, and it appears that the inadequacies outlined in this Notice of Amendment have been corrected. This letter is to inform you no further action is necessary and this case is now closed. Thank you for your cooperation. Sincerely, Dennis Hinnah Deputy Director, Western Region Pipeline and Hazardous Materials Safety Administration cc: PHP-60 Compliance Registry PHP-500 J. Strawn (#136010)#

520110020M_notice of amendment_10252011_text.pdf, page 1Official PDFNOTICE OF AMENDMENT CERTIFIED MAIL - RETURN RECEIPT REQUESTED October 25, 2011 Mr. Allen Nesteby Operations Superintendent Barrow Utilities and Electric Cooperative Inc. 1295 Agvik St. P.O. Box 449 Barrow, AK 99723 CPF 5-2011-0020M Dear Mr. Nesteby: On September 12-16, 2011, representatives of the Pipeline and Hazardous Materials Safety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code, inspected Barrow Utilities and Electric Cooperative Inc.’s (BUECI) procedures and records for Distribution Integrity Management Program (DIMP) in Barrow, Alaska. On the basis of the inspections, PHMSA has identified the apparent inadequacies found within BUECI’s DIMP as described below: 1. §192.1007 What are the required elements of an integrity management plan? A written integrity management plan must contain procedures for developing and implementing the following elements: BUECI must adapt SHRIMP with the basic materials and procedures of operator specific information and procedures such as BUECI’s O&M Manual and incorporate them into the DIMP. 2. §192.1007 What are the required elements of an integrity management plan? A written integrity management plan must contain procedures for developing and implementing the following elements:#

520110020M_notice of amendment_10252011_text.pdf, page 2(a) Knowledge. An operator must demonstrate an understanding of its gas distribution system developed from reasonably available information. (1) Identify the characteristics of the pipeline's design and operations and the environmental factors that are necessary to assess the applicable threats and risks to its gas distribution pipeline. (2) Consider the information gained from past design, operations, and maintenance. (3) Identify additional information needed and provide a plan for gaining that information over time through normal activities conducted on the pipeline (for example, design, construction, operations or maintenance activities). (4) Develop and implement a process by which the IM program will be reviewed periodically and refined and improved as needed. (5) Provide for the capture and retention of data on any new pipeline installed. The data must include, at a minimum, the location where the new pipeline is installed and the material of which it is constructed. A. BUECI must add detail to the procedure describing the methods and data sources, used to gather information and knowledge of the system, from reasonably available sources of information (e.g., subject matter experts consulted; OM&I forms, records, system maps). B. BUECI must add detail to the procedure(s) describing the methods used for identifying, listing, and collecting (as appropriate) additional data and information that is needed to fill gaps in knowledge and information due to missing, inaccurate, or incomplete records. 3. §192.1007 What are the required elements of an integrity management plan? A written integrity management plan must contain procedures for developing and implementing the following elements: (b) Identify threats. The operator must consider the following categories of threats to each gas distribution pipeline: Corrosion, natural forces, excavation damage, other outside force damage, material, weld or joint failure (including compression coupling), equipment failure, incorrect operation, and other concerns that could threaten the integrity of its pipeline. An operator must consider reasonably available information to identify existing and potential threats. Sources of data may include, but are not limited to, incident and leak history, corrosion control records, continuing surveillance records, pa-trolling records, maintenance history, and excavation damage experience. BUECI must add detail to the procedure, used to identify existing and potential threats that describe how subject matter expert(s) gathered and input information into the SHRIMP application for the threat assessment. 2#

520110020M_notice of amendment_10252011_text.pdf, page 3The procedure must detail how BUECI considers all available information for the threat assessment including all leak data, corrosion control inspection, and other inspection and maintenance documentation. 4. §192.1007 What are the required elements of an integrity management plan? A written integrity management plan must contain procedures for developing and implementing the following elements: (c) Evaluate and rank risk. An operator must evaluate the risks associated with its distribution pipeline. In this evaluation, the operator must determine the relative importance of each threat and estimate and rank the risks posed to its pipeline. This evaluation must consider each applicable current and potential threat, the likelihood of failure associated with each threat, and the potential consequences of such a failure. An operator may subdivide its pipeline into regions with similar characteristics (e.g., contiguous areas within a distribution pipeline consisting of mains, services and other appurtenances; areas with common materials or environmental factors), and for which similar actions likely would be effective in reducing risk. A. BUECI must add details to their DIMP to include user validation of the risk ranking results from the SHRIMP application. B. BUECI must enhance their DIMP by providing detailed justification for not considering subdividing their system into 2 regions (steel and plastic). Pipelines with similar characteristics that subdivide are likely to be effective in reducing risk in order to more accurately address integrity management issues. DIMP must be detailed to show the justification that risk is reduced and integrity management issues are addressed accurately without subdividing its pipeline into 2 regions. 5. §192.1007 What are the required elements of an integrity management plan? A written integrity management plan must contain procedures for developing and implementing the following elements: (e) Measure performance, monitor results, and evaluate effectiveness. (i) Number of hazardous leaks either eliminated or repaired as required by §192.703(c) of this subchapter (or total number of leaks if all leaks are repaired when found), categorized by cause; (ii) Number of excavation damages; (iii) Number of excavation tickets (receipt of information by the underground facility operator from the notification center); (iv) Total number of leaks either eliminated or repaired, categorized by cause; (v) Number of hazardous leaks either eliminated or repaired as required by §192.703(c) (or total number of leaks if all leaks are repaired when found), categorized by material; and 3#

520110020M_notice of amendment_10252011_text.pdf, page 4(vi) Any additional measures the operator determines are needed to evaluate the effectiveness of the operator's IM program in controlling each identified threat. (in its entirety) A. BUECI must modify their DIMP to include procedures for establishing baselines for performance measures from which to monitor effectiveness of its DIMP. B. BUECI must modify their DIMP to include requirements for monitoring the performance measure described in §192.1007(e)(1)(v) as “Number of hazardous leaks either eliminated or repaired as required by §192.703(c) (or total number of leaks if all leaks are repaired when found), categorized by material”. 6. §192.1007 What are the required elements of an integrity management plan? A written integrity management plan must contain procedures for developing and implementing the following elements: (f) Periodic Evaluation and Improvement. An operator must re-evaluate threats and risks on its entire pipe-line and consider the relevance of threats in one location to other areas. Each operator must determine the appropriate period for conducting complete program evaluations based on the complexity of its system and changes in factors affecting the risk of failure. An operator must conduct a complete program re-evaluation at least every five years. The operator must consider the results of the performance monitoring in these evaluations. BUECI must describe in their DIMP details of how BUECI will conduct a periodic evaluation. 7. §192.1011 What records must an operator keep? An operator must maintain records demonstrating compliance with the requirements of this subpart for at least 10 years. The records must include copies of superseded integrity management plans developed under this subpart. A. BUECI must include a procedure in its DIMP with the requirement of 10 year retention of certain documents, that are used to demonstrate compliance with 192 Subpart P, such as BUECI OM&I forms. BUECI must show where compliance with 192, subpart P, exists in its procedures that requires certain documentation be retained for 10 years. BUECI documents the various forms and documentation used in the threat identification section, but does not show where such documentation must be retained for 10 years in accordance with this subpart of the code. B. BUECI must modify their DIMP to include a revision log for its DIMP that identifies when significant changes were made and the date of the implementation of a revised DIMP. A “comments” field should be incorporated into any revision log4#

520110020M_notice of amendment_10252011_text.pdf, page 5(or periodic evaluation log) that provides an area for an explanation of decisions and/or changes made. Response to this Notice This Notice is provided pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.237. Enclosed as part of this Notice is a document entitled Response Options for Pipeline Operators in Compliance 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 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). 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. If, after opportunity for a hearing, your plans or procedures are found inadequate as alleged in this Notice, you may be ordered to amend your plans or procedures to correct the inadequacies (49 C.F.R. § 190.237). If you are not contesting this Notice, we propose that you submit your amended procedures to my office within 45 days of receipt of this Notice. This period may be extended by written request for good cause. Once the inadequacies identified herein have been addressed in your amended procedures, this enforcement action will be closed. It is requested (not mandated) that BUECI maintain documentation of the safety improvement costs associated with fulfilling this Notice of Amendment (preparation/revision of plans, procedures) and submit the total to Dennis Hinnah, Deputy Director, Western Region, Pipeline and Hazardous Materials Safety Administration. In correspondence concerning this matter, please refer to CPF 5-2011-0020M and, for each document you submit, please provide a copy in electronic format whenever possible. Sincerely, Dennis Hinnah Deputy Director, Western Region Pipeline and Hazardous Materials Safety Administration Enclosure: Response Options for Pipeline Operators in Compliance Proceedings cc: PHP-60 Compliance Registry PHP-500 J. Strawn (#136010) 5#