{"operation":"document","citation":"CPF 520125013","title":"CENEX PIPELINE LLC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2012-05-18","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.214(b), 195.401(b)(1), 195.404(a), 195.404(a)(1)(vii), 195.404(b)(1), 195.432(b), 195.452(h), 195.505(b), 195.573(c), 195.575(e), 195.581, 195.583(b).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520125013.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520125013.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520125013","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520125013","body":"Notice of Probable Violation involving CENEX PIPELINE LLC. PHMSA's enforcement data identifies the cited regulations as 195.214(b),  195.401(b)(1),  195.404(a),  195.404(a)(1)(vii),  195.404(b)(1),  195.432(b),  195.452(h),  195.505(b),  195.573(c),  195.575(e),  195.581,  195.583(b). The case was opened on 2012-05-18 and is reported as closed as of 2014-04-18. Proposed civil penalty: $76,500. Assessed civil penalty: $41,500. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520125013_closure letter_04182014.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520125013/520125013_closure%20letter_04182014.pdf\n\n520125013_closure letter_04182014_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520125013/520125013_closure%20letter_04182014_text.pdf\n\n520125013_Final Order_12312012.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520125013/520125013_Final%20Order_12312012.pdf\n\n520125013_Final Order_12312012_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520125013/520125013_Final%20Order_12312012_text.pdf\n\n520125013_NOPV PCP PCO_05182012.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520125013/520125013_NOPV%20PCP%20PCO_05182012.pdf\n\n520125013_NOPV PCP PCO_05182012_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520125013/520125013_NOPV%20PCP%20PCO_05182012_text.pdf\n\n520125013_Operator_response_06192012.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520125013/520125013_Operator_response_06192012.pdf\n\n520125013_closure letter_04182014_text.pdf\n\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nApril 18, 2014\nMr. John Traeger\nPresident\nCenex Pipeline, LLC\nP.O. Box 909\nLaurel, Montana 59044-0909\nCPF 5-2012-5013\nDear Mr. Traeger:\nOn December 31, 2012, the Pipeline and Hazardous Materials Safety Administration (PHMSA)\nissued to Cenex Pipeline, LLC a Final Order in the above-referenced case. This Order included a\nCompliance Order. Based on our review of the documentation you provided and an on-site\npipeline safety inspection on April 14, 2014, it has been determined that you have complied with\nthe terms of this Order.\nAccordingly, this case is now closed and no further action is contemplated with respect to the\nmatters involved in this case. Thank you for your cooperation in this matter.\nSincerely,\nChris Hoidal\nDirector, Western Region\nPipeline and Hazardous Materials Safety Administration\ncc: PHP-60 Compliance Registry\nPHP-500 M. Petronis\n\n520125013_NOPV PCP PCO_05182012_text.pdf\n\nNOTICE OF PROBABLE VIOLATION\nPROPOSED CIVIL PENALTY\nand\nPROPOSED COMPLIANCE ORDER\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nMay 18, 2012\nMr. Daniel Knepper\nPresident and Chief Operating Officer\nCenex Pipeline Company\n803 Highway 212 South\nP.O. Box 909\nLaurel, MT 59044-0909\nCPF 5-2012-5013\nDear Mr. Knepper:\nBetween August 16 and October 29, 2010, representatives of the Pipeline and Hazardous\nMaterials Safety Administration (PHMSA) pursuant to Chapter 601 of 49 United States Code\ninspected Cenex Pipeline Company (Cenex) pipeline operation and maintenance (O&M)\nprocedures and records in Laurel, Montana. In addition, PHMSA’s representative conducted\nfield inspections of numerous Cenex pipeline facilities in Montana and North Dakota.\nAs a result of these inspections, it appears that you have committed probable violations of the\nPipeline Safety Regulations, Title 49, Code of Federal Regulations. The items inspected and the\nprobable violations are:\n\n\n\n1. § 195.214 Welding procedures.\n(b) Each welding procedure must be recorded in detail, including the results of the\nqualifying tests. This record must be retained and followed whenever the procedure is\nused.\nCenex did not record in detail the results of the qualifying tests for their in-service welding\nprocedure 110504-1. This procedure is used for welding metal repair sleeves to pipe. The\nqualifying test records for in-service weld procedure 110504-1 lacked sufficient detail.\nSpecifically, the test records did not differentiate between tests done for the groove weld and\ntests done for the sleeve (fillet) weld. The record showed the force required for the rupture of\ntwo tensile test coupons but the record did not show those coupons’ sizes or the results for the\nmaximum and minimum tensile stresses that resulted from these tests. API 1104 Table B-1\nrequires that the groove weld have two tensile tests, two nick-break tests, two root bend tests and\ntwo face bend tests. API 1104 Table B-1 also requires that the sleeve weld have 4 nick-break\ntests, 4 face bend tests, and 4 macro tests. The record showed results for two nick-break tests,\ntwo root bend tests, and two face bend tests but the record did not differentiate if these tests were\non the groove weld or sleeve weld. There were no results for sleeve weld macro tests. In\naccordance with § 195.214, an operator is required to maintain detailed records of weld\nprocedure qualification tests.\n2. §195.401 General requirements.\n(b) An operator must make repairs on its pipeline system according to the following\nrequirements:\n(1) Non Integrity management repairs. Whenever an operator discovers any condition\nthat could adversely affect the safe operation of its pipeline system, it must correct the\ncondition within a reasonable time. However, if the condition is of such a nature that it\npresents an immediate hazard to persons or property, the operator may not operate the\naffected part of the system until it has corrected the unsafe condition.\nCenex failed to correct within a reasonable time a discovered condition that could adversely\naffect the safe operation of its Minot Tanks 201 and 202. Specifically, during the 2007 external\ninspections of these tanks, Cenex discovered that these tanks would only be suitable for service if\nsafe fill height recommendations were adhered to. However, during the 2010 inspection, neither\nof the inspection reports contained what the safe fill height was for each tank. Without an\nestablished safe fill height, Cenex cannot operate these tanks safely. An operator is required to\ncorrect conditions affecting safe operation of its system in a reasonable time after they discover\nthe condition.\n3. § 195.404 Maps and Records.\n(a) Each operator shall maintain current maps and records of its pipeline systems that\ninclude at least the following information;\n(1) Location and identification of the following pipeline facilities;\n(vii) Safety devices to which §195.428 applies.\n2\n\n\n\nCenex did not maintain current maps and records for its North Dakota section of the Cenex\npipeline. Reviews of Cenex’s Piping and Instrumentation Diagrams (P&ID) revealed that Cenex\nhad not updated the P&IDs for the North Dakota section of the Cenex pipeline with current\npressure safety valve tag numbers. The location of those safety devices cannot be easily\nestablished unless the safety valve tag numbers are shown on the P&IDs. An operator must\nmaintain current maps and records with the location and identification of safety devices to which\n§ 195.428 applies.\n4. § 195.404 Maps and Records.\n(a) Each operator shall maintain current maps and records of its pipeline systems that\ninclude at least the following information;\n(1) Location and identification of the following pipeline facilities;\n(i) Breakout tanks;\n(ii) Pump stations;\n(iv) Pipeline valves;\n(v) Facilities to which §195.402(c)(9) applies;\n(vi) Rights-of-way; and\n(vii) Safety devices to which §195.428 applies.\n(2) All crossings of public roads, railroads, rivers, buried utilities, and foreign\npipelines.\n(3) The maximum operating pressure of each pipeline.\n(4) The diameter, grade, type and nominal wall thickness of all pipe.\nAt the time of our inspection, Cenex did not have current maps and records of its pipeline\nsystem. The maps and records did not include the location and identification of all the pipeline\nfeatures and appurtenances required under §195.404(a). Interviews with Cenex personnel\nrevealed that it had been 10 years since Cenex had last updated the alignment sheets for the\nCenex pipeline. There has been significant urban development and oil field activity along much\nof the Cenex pipeline in the last 10 years. During this time, there has been several pipeline\nrepairs and replacement projects as well as pump station modifications. An operator must\nmaintain current maps and records of its systems, including but not limited to, current\ninformation such as new third party crossings, new breakout tanks, and other pipeline changes as\nnoted under 195.404(a).\n5. § 195.404 Maps and Records.\n(b) Each operator shall maintain for at least 3 years daily operating records that\nindicate-\n(1) The discharge pressure at each pump station; and\nCenex did not maintain daily operating discharge pressures for the Billings Tank Farm booster\npump station. Specifically, Cenex did not have a pressure recording device for discharge\npressures at the Billings Tank Farm booster pump, therefore, discharge pressures from this pump\nstation could not be recorded. The Billings Tank Farm pump station discharges product into a\npipeline section that carries it to the suction side of the Billings pump station, approximately 2.5\nmiles downstream from the Billings Tank Farm pump station. This section of pipeline crosses\n3\n\n\n\nthe Yellowstone River and traverses property that is not under the control of Cenex. An operator\nmust maintain at least three years of daily discharge pressures at each pump station and therefore\nmust maintain a discharge pressure recording device that will allow the operator to record those\ndaily discharge records.\n6. § 195.432 Inspection of in-service breakout tanks.\n(b) Each operator must inspect the physical integrity of in-service atmospheric and\nlow-pressure steel aboveground breakout tanks according to API Standard 653\n(incorporated by reference, see § 195.3). However, if structural conditions prevent\naccess to the tank bottom, the bottom integrity may be assessed according to a plan\nincluded in the operations and maintenance manual under § 195.402(c)(3).\nCenex failed to perform external tank inspections for eight (8) of their breakout tanks within the\nmaximum 5 year interval, in accordance with API 653 Section 6.3.2.1, either after 1) the\nprevious external tank inspection or 2) May 3, 1999, the effective date of § 195.432(b),\nwhichever came later. Cenex records show that the following breakout tanks’ external\ninspection intervals were exceeded by the following time periods.\nCenex Breakout Tank\nIdentifier\nAPI 653 external\ninspection deadlines\nActual API 653\nexternal inspection\ncompletion date\nTime period that\nCenex exceeded the\ninterval for API 653\nexternal inspections\nBillings Tank 283 May 2004 September 2008 51months\nBillings Tank 284 April 2006 October 2009 41months\nMinot Tank 202 May 2004 November 2007 41 months\nMinot Tank 203 June 2005 November 2007 28 months\nMinot Tank 204 June 2006 November 2007 16 months\nMinot Tank 207 May 2004 November 2007 41 months\nMinot Tank 209 May 2004 November 2007 41 months\nMinot Tank 210 June 2005 November 2007 28 months\nIn accordance with § 195.432 and the referenced standard, API 653 6.3.2.1, an operator is\nrequired to perform external inspections of all breakout tanks at an interval that may not exceed 5\nyears.\n7. § 195.452 Pipeline integrity management in high consequence areas.\n(h) What actions must an operator take to address integrity issues?\n(1) General requirements. An operator must take prompt action to address all\nanomalous conditions the operator discovers through the integrity assessment or\ninformation analysis. In addressing all conditions, an operator must evaluate all\nanomalous conditions and remediate those that could reduce a pipeline's integrity. An\noperator must be able to demonstrate that the remediation of the condition will ensure\nthe condition is unlikely to pose a threat to the long-term integrity of the pipeline. An\noperator must comply with § 195.422 when making a repair….\n(4) Special requirements for scheduling remediation\n4\n\n\n\n(ii) 60-day conditions. Except for conditions listed in paragraph (h)(4)(i) of this section,\nan operator must schedule evaluation and remediation of the following conditions\nwithin 60 days of discovery of condition.\n(A) A dent located on the top of the pipeline (above the 4 and 8 o'clock positions) with a\ndepth greater than 3% of the pipeline diameter (greater than 0.250 inches in depth for a\npipeline diameter less than Nominal Pipe Size (NPS) 12).\n(B) A dent located on the bottom of the pipeline that has any indication of metal loss,\ncracking or a stress riser.\n(iii) 180-day conditions. Except for conditions listed in paragraph (h)(4)(i) or (ii) of this\nsection, an operator must schedule evaluation and remediation of the following within\n180 days of discovery of the condition:\n(A) A dent with a depth greater than 2% of the pipeline's diameter (0.250 inches in\ndepth for a pipeline diameter less than NPS 12) that affects pipe curvature at a girth\nweld or a longitudinal seam weld.\nCenex failed to evaluate all dent anomalies within HCAs. Specifically, Cenex did not account\nfor the in-line inspection tool’s accuracy when determining which anomalies required further\ninvestigation. During inspection interviews, Cenex acknowledged that they did not add the in-\nline inspection tool vendor’s reported tool tolerance to identified dent depths. During two\ndeformation tool runs conducted in 2008, several dents were repaired but 16 dents were\ndiscovered within HCAs that would have had indications deeper than .25 inches had the tool\nvendor’s advertised accuracies been added to these dent’s reported depths. Subsequently these\ndents were not reported to be greater than .25 inches so they were not properly evaluated. The\nID#s for the dents found during the Glendive Station to Minot Station in-line inspection are\n14000022, 14000048, 14000027, 14000034, 14000051, 14000012, 14000013, 14000023,\n14000069, 14000019, 14000076, 14000068, 14000058, and 14000060. The ID#s for the dents\nfound during the Laurel Station to Billings Station in-line inspection are 14000003 and\n14000004.\nCenex’s vendor’s published deformation tool accuracy had a declared confidence level of ± 1%\nof the nominal outside diameter (OD) of the pipe 80% of the time. Both of these pipeline\nsections had a nominal OD of 8.625 inches. 1% of 8.625 inches is ±.09 inches. Allowing for the\nvendor’s advertised accuracies makes it possible that a dent reported as greater than .16 inches\ncould actually be deeper than .25 inches. Taking into account the deformation tool accuracy, any\ndeformation that was recorded on the deformation tool log that was found greater than .16 inches\nshould have been evaluated to determine if the criteria under §195.452(h)(4)(ii) or\n§195.452(h)(4)(iii) had been met. If found to meet that criteria, these deformations should have\nbeen investigated, precisely measured and repaired if required. The annotated deformation logs\nprovided by Cenex for the Glendive to Minot run and for the Laurel to Billings Station runs\nshows that there were 16 deformation tool dent calls greater than .16 inches within an HCA\nwhich were not properly evaluated, investigated, or repaired. An operator is required to evaluate\nany dent greater than .25 inches on pipe that is less than Nominal Pipe Size (NPS) 12 when the\ndent is located on the top of the pipeline or when the dent affects pipe curvature at a girth weld or\na longitudinal seam weld. If the dent meets any of those criteria, the operator must repair that\ndent.\n5\n\n\n\n8. § 195.452 Pipeline integrity management in high consequence areas.\n(h) What actions must an operator take to address integrity issues?\n(1) General requirements. An operator must take prompt action to address all\nanomalous conditions the operator discovers through the integrity assessment or\ninformation analysis. In addressing all conditions, an operator must evaluate all\nanomalous conditions and remediate those that could reduce a pipeline's integrity. An\noperator must be able to demonstrate that the remediation of the condition will ensure\nthe condition is unlikely to pose a threat to the long-term integrity of the pipeline. An\noperator must comply with § 195.422 when making a repair….\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 must\ntemporarily reduce operating pressure or shut down the pipeline until the operator\ncompletes the repair of these conditions. An operator must calculate the temporary\nreduction in operating pressure using the formula in Section 451.6.2.2 (b) of ANSI/\nASME B31.4 (incorporated by reference, see § 195.3). An operator must treat the\nfollowing conditions 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 the\nanomaly. Suitable remaining strength calculation methods include, but are not limited\nto, ASME/ANSI B31G (``Manual for Determining the Remaining Strength of Corroded\nPipelines'' (1991) or AGA Pipeline Research Committee Project PR-3-805 (``A\nModified Criterion for Evaluating the Remaining Strength of Corroded Pipe''\n(December 1989)). These documents are incorporated by reference and are available at\nthe addresses listed in Sec. 195.3….\n(iii) 180-day conditions. Except for conditions listed in paragraph (h)(4)(i) or (ii) of this\nsection, an operator must schedule evaluation and remediation of the following within\n180 days of discovery of the condition:\n(D) A calculation of the remaining strength of the pipe shows an operating pressure\nthat is less than the current 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 of\nCorroded Pipelines'' (1991)) or AGA Pipeline Research Committee Project PR-3-805\n(``A Modified Criterion for Evaluating the Remaining Strength of Corroded Pipe''\n(December 1989)). These documents are incorporated by reference and are available at\nthe addresses listed in Sec. 195.3.\n(E) An area of general corrosion with a predicted metal loss greater than 50% of\nnominal wall.\n(F) Predicted metal loss greater than 50% of nominal wall that is located at a crossing\nof another pipeline, or is in an area with widespread circumferential corrosion, or is in\nan area that could affect a girth weld.\nCenex failed to properly evaluate metal loss anomalies found within HCAs on their Cenex\npipeline. Cenex did not account for the in-line inspection tool’s accuracy with respect to metal\nloss. During inspection interviews, Cenex acknowledged that they did not account for the in-line\n6\n\n\n\ninspection tool’s accuracy when they evaluated which metal loss anomalies required further\ninvestigation. From Cenex’s 2008 metal loss in-line inspection and repair records 40 anomalies\nwere reviewed by PHMSA. It was found that of those 40 anomalies 4 were found to have had\ndepths 34% of the nominal wall greater than the reported depths. This indicates that10% of all\nanomalies will have a depth 34% of nominal wall greater than their reported depth. Therefore, it\ncan be assumed that for every 10 anomalies reported as having metal loss equal or greater than\n16% of nominal wall one will have a measured metal loss depth of 50% of nominal wall. An\noperator must evaluate those metal loss anomalies that are greater than 50% of the nominal wall,\ntaking the in-line inspection tool’s accuracy into account, to determine if these anomalies are at a\ncrossing of another pipeline, or in an area with widespread circumferential corrosion, or in an\narea that could affect a girth weld. Additionally, an operator must evaluate anomalies using the\nin-line inspection tool’s accuracy to determine if they have sufficient remaining strength at the\nanomalies. If an operator finds that the metal loss anomaly meets any of these criteria then the\nanomaly must be repaired.\n9. § 195.505 Qualification program.\nEach operator shall have and follow a written qualification program. The program\nshall include provisions to:\n(b) Ensure through evaluation that individuals performing covered tasks are qualified;\nCenex did not evaluate employees to determine they could recognize and react to task specific\nabnormal operating conditions when employees were re-qualified. Pursuant to § 195.505, an\noperator’s qualification program must include provisions to ensure that individuals performing\ncovered tasks are qualified. ‘Qualified’ is defined in § 195.503 as “an individual [that] has been\nevaluated and can perform assigned covered tasks and recognize and react to abnormal operating\nconditions.” Cenex records show that employees were only evaluated for their ability to\nrecognize and react to task specific AOCs when they were initially qualified. When employees\nwere re-qualified they were not re-evaluated for their ability to recognize and react to task\nspecific AOCs. An operator must ensure that employees are able to recognize and react to task\nspecific AOCs when they are re-qualified.\n10. § 195.573 What must I do to monitor external corrosion control?\n(c) Rectifiers and other devices. You must electrically check for proper performance\neach device in the first column at the frequency stated in the second column.\nDevice Check frequency\nRectifier.................................\nReverse current switch\nDiode\nInterference bond whose failure would\njeopardize structural protection\nAt least six times each calendar year, but\nwith intervals not exceeding 2 ½ months\nOther interference bond....................... At least once each calendar year, but with\nintervals not exceeding 15 months.\n7\n\n\n\nCenex failed to electrically check polarization cell replacements (PCRs) at least six times each\ncalendar year with intervals not exceeding 2 ½ months. Specifically Cenex failed to electrically\ncheck polarization cell replacements recently installed where the Cenex pipeline parallels a wind\nfarm electrical power transmission line between Fargo and Minot, North Dakota 6 times per year\nat intervals not to exceed 2 ½ months. Cenex informed PHMSA that they have only monitored\nthese PCRs annually. These types of devices are considered to be a form of diode or reverse\ncurrent switch in that they allow AC current to pass through them back to the source ground but\nthey do not allow protective CP current to pass to ground thus minimizing AC interference\ncurrents that could jeopardize structural protection. An operator is required to electrically\ninspect devices like reverse current switches, diodes, and interference bonds whose failure could\njeopardize structural protection at least six times each calendar year with intervals not exceeding\n2 ½ months.\n11. § 195.575 Which facilities must I electrically isolate and what inspections, tests, and\nsafeguards are required?\n(e) If a pipeline is in close proximity to electrical transmission tower footings, ground\ncables, or counterpoise, or in other areas where it is reasonable to foresee fault currents\nor an unusual risk of lightning, you must protect the pipeline against damage from fault\ncurrents or lightning and take protective measures at insulating devices.\nCenex failed to protect their pipeline against damage from fault currents or lighting. Interviews\nwith Cenex personnel during the inspection of the Laurel to Billings section of the Cenex\npipeline revealed that there was no fault current protection installed where the Cenex Products\npipeline is in close proximity to a fence around an electrical substation that was located\ndownstream from the Laurel Refinery. An operator must install ground fault protection where it\nis reasonable to foresee fault currents or unusual risk of lightning.\n12. § 195.581 Which pipelines must I protect against atmospheric corrosion and what\ncoating material may I use?\n(a) You must clean and coat each pipeline or portion of pipeline that is exposed to the\natmosphere, except pipelines under paragraph (c) of this section…\n(c) Except portions of pipelines in offshore splash zones or soil-to-air interfaces, you\nneed not protect against atmospheric corrosion any pipeline for which you demonstrate\nby test, investigation, or experience appropriate to the environment of the pipeline that\ncorrosion will-\n(1) Only be a light surface oxide; or\n(2) Not affect the safe operation of the pipeline before the next scheduled inspection.\nCenex failed to provide protection against atmospheric corrosion for a soil-to-air interface.\nRecords show that on June 21, 2005 Cenex found that the soil-to-air interface at the Minot\nstation mainline piping spool, identified as piping item FRS-1000, needed protective coating. On\nJune 21, 2008, Cenex records show that this same soil-to-air interface still needed protective\ncoating. Additionally Cenex could not provide evidence that this soil-to-air interface had been\ncoated at the time of this 2010 inspection, thus establishing that Cenex failed to provide\nprotection against atmospheric corrosion at its FRS-1000 mainline pipeline spool soil-to-air\n8\n\n\n\ninterface for at least 5 years. An operator is required to provide protection from atmospheric\ncorrosion at all pipeline soil-to-air interfaces.\n13. § 195.583 What must I do to monitor atmospheric corrosion control?\n(b) During inspections you must give particular attention to pipe at soil-to-air\ninterfaces, under thermal insulation, under disbonded coatings, at pipe supports, in\nsplash zones, at deck penetrations, and in spans over water.\nCenex failed to monitor atmospheric corrosion at several above ground pipe supports located at\nthe Billings station, Rosebud station, Glendive station, MP 98, MP 193B (Powder River DS\nblock valve), MP 211B (Yellowstone River DS block valve), and MP 222. These pipe supports\nare either made from concrete or they are the type that cannot be easily lowered to ensure\nadequate monitoring of atmospheric corrosion between the pipe and the support can be\naccomplished. The areas in the vicinity of the supports had rust on the pipe at the interface\nbetween the pipe and the pipe supports that may indicate on-going atmospheric corrosion. An\noperator must monitor atmospheric corrosion between above ground pipe and its pipe supports.\nProposed Civil Penalty\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. The Compliance Officer has reviewed the circumstances and\nsupporting documentation involved in the above probable violations and has recommended that\nyou be preliminarily assessed a civil penalty of $76,500 as follows:\nItem number PENALTY\n6 $41,500\n12 $35,000\nProposed Compliance Order\nWith respect to item(s) 1, 2, 3, 4, 5, 7, 8, 9, 10, 11, 12 and 13 pursuant to 49 United States Code\n§ 60118, the Pipeline and Hazardous Materials Safety Administration proposes to issue a\nCompliance Order to Cenex. Please refer to the Proposed Compliance Order, which is enclosed\nand made a part of this Notice.\nResponse to this Notice\nEnclosed as part of this Notice is a document entitled Response Options for Pipeline Operators\nin Compliance Proceedings. Please refer to this document and note the response options. Be\nadvised that all material you submit in response to this enforcement action is subject to being\nmade publicly available. If you believe that any portion of your responsive material qualifies for\nconfidential treatment under 5 U.S.C. 552(b), along with the complete original document you\nmust provide a second copy of the document with the portions you believe qualify for\nconfidential treatment redacted and an explanation of why you believe the redacted information\n9\n\n\n\nqualifies for confidential treatment under 5 U.S.C. 552(b). If you do not respond within 30 days\nof receipt of this Notice, this constitutes a waiver of your right to contest the allegations in this\nNotice and authorizes the Associate Administrator for Pipeline Safety to find facts as alleged in\nthis Notice without further notice to you and to issue a Final Order.\nIn your correspondence on this matter, please refer to CPF 5-2012-5013 and for each document\nyou submit, please provide a copy in electronic format whenever possible.\nSincerely,\nChris Hoidal\nDirector, Western Region\nPipeline and Hazardous Materials Safety Administration\nEnclosures: Proposed Compliance Order\nResponse Options for Pipeline Operators in Compliance Proceedings\ncc: PHP-60 Compliance Registry\nPHP-500 G. Davis (#129363, 129364, 129365)\n10\n\n\n\nPROPOSED COMPLIANCE ORDER\nPursuant to 49 United States Code § 60118, the Pipeline and Hazardous Materials Safety\nAdministration (PHMSA) proposes to issue to Cenex Pipeline Company a Compliance Order\nincorporating the following remedial requirements to ensure the compliance of Cenex Pipeline\nCompany with the pipeline safety regulations:\n1. In regard to Item Number 1 of the Notice pertaining to Cenex’s failure to maintain\na detailed record of the qualification report for weld procedure 110504-1, ensure\nthe weld qualification report for weld procedure 110504-1 includes; 1) the groove\nqualifying test results including the weld tensile strength coupon sizes and the\nbreaking stress that each tensile strength coupon experienced during testing, nick-\nbreak test results, root bend test results, and face bend test results; and 2) the\nsleeve weld qualifying test results including the nick-break test results, the face\nbend test results, and the macro test results. Cenex must submit the corrected\nrecord of the weld qualification report for weld procedure 110504-1 to Chris\nHoidal, Director, Western Region.\n2. In regard to Item Number 2 of the Notice pertaining to Cenex’s failure to\ndetermine the safe fill height for Minot Tanks 201 and 202, Cenex must ensure\nthat it has determined the safe fill height for these two tanks and Cenex must take\nactions to prevent operation of these tanks above the safe fill height. Cenex must\nprovide those safe fill heights and documentation confirming actions taken to\nprevent operation above those safe fill heights to Chris Hoidal, Director, Western\nRegion.\n3. In regard to Item Number 3 of the Notice pertaining to Cenex’s failure to maintain\ncurrent Piping and Instrumentation Diagrams (P&IDs) of the North Dakota\nsection of the Cenex Products pipeline, Cenex must ensure that its P&IDs for the\nNorth Dakota section of the Cenex Products pipeline includes both the pressure\nsafety valve tag numbers and the pressure set points associated with those\ndevices. Cenex must provide those updated P&IDs to Chris Hoidal, Director,\nWestern Region.\n4. In regard to Item Number 4 of the Notice pertaining to Cenex’s failure to maintain\ncurrent alignment sheets of its Cenex Products pipeline, Cenex must update their\nCenex Products pipeline alignment sheets to ensure that they show current\npipeline information including but not limited to all crossings of public roads,\nrailroads, rivers, buried utilities, foreign pipeline crossings and other pipeline\nchanges as required under 195.404(a). Cenex must provide these updated\nalignment sheets to Chris Hoidal, Director, Western Region.\n5. In regard to Item Number 5 of the Notice pertaining to Cenex’s failure to maintain\ndaily discharge pressures of its Billings Tank Farm pump station, Cenex must\nprovide a pressure recording device at its Billings Tank Farm pump station that\n11\n\n\n\nwill allow them to record the daily discharge pressures of the Billings Tank Farm\npump station and they must ensure that they continuously retain at least 3 years of\nthose records. Cenex must provide evidence of the installation of the above\npressure recording device and documentation that ensures Cenex will retain\npressure discharge records for this site for at least three years to Chris Hoidal,\nDirector, Western Region.\n6. In regard to Item Number 7 of the Notice pertaining to Cenex’s failure to evaluate\ndeformation anomalies discovered during the Cenex pipeline 2008 integrity\nassessment by taking the in-line inspection tool’s accuracies into account, Cenex\nmust evaluate the following dent ID#s found during the Glendive Station to Minot\nStation in-line inspection: 14000022, 14000048, 14000027, 14000034, 14000051,\n14000012, 14000013, 14000023, 14000069, 14000019, 14000076, 14000068,\n14000058, and 14000060 and they must evaluate the following dent ID#s found\nduring the Laurel Station to Billings Station in-line inspection: 14000003,\n14000004. If any of these dents are found to be located on the top of the pipeline\nor found to affect pipe curvature at a girth weld or a longitudinal seam weld\nCenex must then repair those dents. Cenex must submit records of the above\nevaluations and investigations and any subsequent repairs to Chris Hoidal,\nDirector, Western Region.\n7. In regard to Item Number 8 of the Notice pertaining to failure to evaluate some\nmetal loss anomalies that could reduce their pipeline’s integrity, Cenex must re-\nreview its ILI metal loss logs taking known data from the 2008 MFL ILI run and\nadding the in-line tool accuracy determined by previous 2008 anomaly\ninvestigations. Cenex must then investigate any anomalies that have a potential to\nmeet the repair criteria under §195.452(h) and if anomalies are found to meet that\ncriteria Cenex must make appropriate repairs to their pipeline. Cenex must\nsubmit records of the above evaluations and investigations and any subsequent\nrepairs to Chris Hoidal, Director, Western Region.\n8. In regard to Item Number 9 of the Notice pertaining to Cenex’s failure to evaluate\nemployees ability to recognize and react to task specific abnormal operating\nconditions when employees are re-qualified, Cenex must ensure that all\nemployees are evaluated for their ability to recognize and react to task specific\nabnormal operating conditions when they have and are being re-qualified. Cenex\nmust provide documentation showing that re-qualified employees have been re-\nevaluated to recognize and react to task specific abnormal operating conditions to\nChris Hoidal, Director, Western Region.\n9. In regard to Item Number 10 of the Notice pertaining to Cenex’s failure to\nelectrically inspect polarization cell replacements (PCRs) six times each calendar\nyear with intervals not exceeding 2 ½ months, Cenex must ensure that they\nelectrically inspect each of their PCRs recently installed where the Cenex pipeline\nparallels a wind farm electrical power transmission line between Fargo and Minot,\n12\n\n\n\nNorth Dakota six times each calendar year at intervals not exceeding 2 ½ months.\nCenex must provide documentation insuring that these PCRs are electrically\ninspected six times each calendar year at intervals not exceeding 6 months to\nChris Hoidal, Director, Western Region.\n10. In regard to Item Number 11 of the Notice pertaining to Cenex’s failure to install\nground fault protection at the electrical substation downstream from the Laurel\nRefinery, Cenex must install ground fault protection at the electrical substation\ndownstream from the Laurel Refinery between MP 0.5 and 0.8. Cenex must\nprovide evidence that ground fault protection has been provided at this location to\nChris Hoidal, Director, Western Region.\n12. In regard to Item Number 12 of the Notice pertaining to inadequate coating of the\nsoil-to-air interface on the Minot station mainline spool, Cenex must provide\ncoating to the soil-to-air interface on the Minot station mainline spool which is\nidentified in Cenex atmospheric inspection records as piping item FRS-1000.\nCenex must provide evidence when the coating of this location has been\ncompleted to verify that Cenex has complied with this compliance order item.\n13. In regard to Item Number 13 of the Notice pertaining to Cenex’s failure to inspect\nfor atmospheric corrosion under above ground pipe supports, Cenex must inspect\nbetween the above ground pipe and its associated supports at Billings station,\nRosebud station, Glendive station, MP 98, MP 193B Powder River DS block\nvalve, MP 211B Yellowstone River DS block valve, and MP 222. Cenex must\ntake actions to ensure that future inspections will allow inspection for atmospheric\ncorrosion between above ground pipe and their associated supports at Billings\nstation, Rosebud station, Glendive station, MP 98, MP 193B Powder River DS\nblock valve, MP 211B Yellowstone River DS block valve, and MP 222. Cenex\nmust repair any corrosion that is found during the required atmospheric corrosion\ninspections at these above ground pipe support locations. Cenex must provide\nevidence that measures have been taken to allow for future atmospheric corrosion\ninspections between above ground pipe and associated supports at the above\nlocations and must provide documentation of atmospheric corrosion inspections\nand associated repairs at the above locations to Chris Hoidal, Director, Western\nRegion.\n14. Cenex must complete the above compliance order items within 60 days after\nreceipt of the Final Order.\n15. It is requested (not mandated) that Cenex maintain documentation of the safety\nimprovement costs associated with fulfilling this Compliance Order and submit\nthe total to Chris Hoidal, Director, Western Region, Pipeline and Hazardous\nMaterials Safety Administration. It is requested that these costs be reported in\ntwo categories: 1) total cost associated with preparation/revision of plans,\nprocedures, studies and analyses, and 2) total cost associated with replacements,\nadditions and other changes to pipeline infrastructure.\n13\n\n520125013_Final Order_12312012_text.pdf\n\nDECEMBER 31, 2012\nMr. John Traeger\nPresident\nCenex Pipeline, LLC\n803 Highway 212 South\nP.O. Box 909\nLaurel, MT 59044-0909\nRe: CPF No. 5-2012-5013\nDear Mr. Traeger:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation, assesses a reduced civil penalty of $41,500, and specifies actions that need to be taken\nby Cenex Pipeline, LLC, to comply with the pipeline safety regulations. The penalty payment\nterms are set forth in the Final Order. When the civil penalty has been paid and the terms of the\nCompliance Order completed, as determined by the Director, Western Region, this enforcement\naction will be closed. Service of the Final Order by certified mail is deemed effective upon the\ndate of mailing, or as otherwise provided under 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nJeffrey D. Wiese\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Mr. Chris Hoidal, Director, Western Region, OPS\nMr. Alan Mayberry, Deputy Associate Administrator for Field Operations, OPS\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\n____________________________________\n)\nIn the Matter of )\n)\nCenex Pipeline, LLC, ) CPF No. 5-2012-5013\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nBetween August 16 and October 29, 2010, pursuant to 49 U.S.C. § 60117, representatives of the\nPipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety\n(OPS), conducted an on-site pipeline safety inspection of the facilities and records of Cenex\nPipeline, LLC (Cenex or Respondent), in Montana and North Dakota. Cenex operates\napproximately 1200 miles of hazardous liquid pipelines and associated terminals in the U.S.1\nThe Cenex Products pipeline system that was inspected by PHMSA extends approximately 671\nmiles from the CHS refinery in Laurel, Montana, to storage facilities in Billings and Glendive,\nMontana, and ends in Fargo, North Dakota.2\nAs a result of the inspection, the Director, Western Region, OPS (Director), issued to\nRespondent, by letter dated ","truncated":true,"body_characters":78056}