{"operation":"document","citation":"CPF 520117001W","title":"FREEPORT-MCMORAN OIL & GAS — Warning Letter","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2011-02-24","effective_on":null,"summary":"CLOSED warning letter citing 195.452(h)(4)(i)(b).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520117001w.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520117001w.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520117001w","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520117001W","body":"Warning Letter involving FREEPORT-MCMORAN OIL & GAS. PHMSA's enforcement data identifies the cited regulation as 195.452(h)(4)(i)(b). The case was opened on 2011-02-24 and is reported as closed as of 2011-02-24. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520117001W_warning letter_02242011.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520117001W/520117001W_warning%20letter_02242011.pdf\n\n520117001W_warning letter_02242011_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520117001W/520117001W_warning%20letter_02242011_text.pdf\n\n520117001W_warning letter_02242011_text.pdf\n\nWARNING LETTER\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nFebruary 24, 2011\nMr. Steve Rusch\nVice President\nPlains Exploration & Production Company\n5640 S. Fairfax Avenue\nLos Angeles, CA 92256\nCPF 5-2011-7001W\nDear Mr. Rusch:\nOn October 13-15, 1010, a representative of the Pipeline and Hazardous Materials Safety\nAdministration (PHMSA), pursuant to Chapter 601 of 49 United States Code, inspected your\nwritten procedures contained within your Integrity Management Program (IMP). Our\nrepresentative also reviewed records to ensure that the IMP procedures were properly\nimplemented. The procedures and records review were conducted at your Los Angeles,\nCalifornia office.\nAs a result of the inspection, it appears that Plains Exploration & Production Company\n(PXP) has committed probable violations of the Pipeline Safety Regulations, Title 49, Code of\nFederal Regulations. The items inspected and the probable violations are:\n1. §195.452 Pipeline integrity management in high consequence areas.\n(h) What actions must an operator take to address integrity issues?\n(4) Special requirements for scheduling remediation.\n(i) Immediate repair conditions. An operator's evaluation and remediation schedule\nmust provide for immediate repair conditions. To maintain safety, an operator\nmust temporarily reduce the operating pressure or shut down the pipeline until the\n\n\n\noperator completes the repair of these conditions. An operator must calculate the\ntemporary reduction in operating pressure using the formula in section 451.7 of\nASME/ANSI B31.4 (incorporated by reference, see § 195.3), if applicable. If the\nformula is not applicable to the type of anomaly or would produce a higher\noperating pressure, an operator must use an alternative acceptable method to\ncalculate a reduced operating pressure. An operator must treat the following\nconditions as immediate repair conditions:\n(B) A calculation of the remaining strength of the pipe shows a predicted burst\npressure less than the established maximum operating pressure at the location of\nthe anomaly. Suitable remaining strength calculation methods include, but are not\nlimited to, ASME/ANSI B31G (``Manual for Determining the Remaining Strength\nof Corroded Pipelines'' (1991) or AGA Pipeline Research Committee Project PR-3-\n805 (``A Modified Criterion for Evaluating the Remaining Strength of Corroded\nPipe'' (December 1989)). These documents are incorporated by reference and are\navailable at the addresses listed in §195.3.\nPXP did not reduce the operating pressure or shut down its pipeline after a calculation of the\nremaining strength of the pipe showed a predicted burst pressure to be less than established\nmaximum operating pressure (MOP) at the location of the discovered anomalies.\nFollowing a September 30, 2009 in-line inspection, PXP conducted a follow-up ultrasonic (UT)\ninspection of its 20” oil pipeline from platform Irene to shore. The in-line inspection (ILI)\nrevealed two external corrosion anomalies on the riser. The riser anomalies were measured by\nthe ILI tool to have metal loss values of 21 and 46 percent. The UT inspection found the\ncorrosion to be adjacent to a welded steel repair sleeve and was actually measured in the field to\nbe between 28 to 68 percent wall loss. The extent of the corrosion included a 22-inch wide area\naround the circumference of the pipe. Following confirmation of these two anomalies on\nSeptember 16, 2010, a Safety Related Condition report was sent to OPS. The anomalies were\nrepaired by Clock Spring on September 18, 2010.\nThe resulting ASME B31.G calculating using the maximum wall loss of 68 percent and a length\nof 22 inches yielded a calculated remaining strength of 813 psi when using a 0.72 safety factor.\nThe burst pressure without a safety factor would have been 1129 psi which is below the 1194\npsi Maximum Operating Pressure (MOP) of the pipeline that PXP continued to use after\ndiscovery of the corrosion. In no circumstance should the pipeline MOP exceed its burst\npressure. The MOP of the pipeline should have been reduced immediately upon discovery.\nUnder 49 United States Code, § 60122, you are subject to a civil penalty not to exceed $100,000\nfor each violation for each day the violation persists up to a maximum of $1,000,000 for any\nrelated series of violations. We have reviewed the circumstances and supporting documents\ninvolved in this case, and have decided not to conduct additional enforcement action or penalty\nassessment proceedings at this time. We advise you to correct the items identified in this letter.\n2\n\n\n\nFailure to do so will result in Plains Exploration & Production Company being subject to\nadditional enforcement action.\nNo reply to this letter is required. If you choose to reply, in your correspondence please refer to\nCPF 5-2011-7001W. Be advised that all material you submit in response to this enforcement\naction is subject to being made publicly available. If you believe that any portion of your\nresponsive material qualifies for confidential treatment under 5 U.S.C. 552(b), along with the\ncomplete original document you must provide a second copy of the document with the portions\nyou believe qualify for confidential treatment redacted and an explanation of why you believe\nthe redacted information qualifies for confidential treatment under 5 U.S.C. 552(b).\nSincerely,\nChris Hoidal\nDirector, Western Region\nPipeline and Hazardous Materials Safety Administration\ncc: PHP-60 Compliance Registry\nPHP-500 H. Monfared (#131602)\n3","truncated":false,"body_characters":6152}