{"operation":"document","citation":"CPF 520130001M","title":"FAIRBANKS NATURAL GAS — Notice of Amendment","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2013-02-26","effective_on":null,"summary":"CLOSED notice of amendment citing 192.1007(a)(1), 192.1007(a)(3), 192.1007(b), 192.1007(c), 192.1007(e)(1), 192.1007(f), 192.1011.","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520130001m.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520130001m.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520130001m","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520130001M","body":"Notice of Amendment involving FAIRBANKS NATURAL GAS. PHMSA's enforcement data identifies the cited regulations as 192.1007(a)(1),  192.1007(a)(3),  192.1007(b),  192.1007(c),  192.1007(e)(1),  192.1007(f),  192.1011. The case was opened on 2013-02-26 and is reported as closed as of 2013-05-20. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520130001M_closure letter_05202013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520130001M/520130001M_closure%20letter_05202013.pdf\n\n520130001M_closure letter_05202013_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520130001M/520130001M_closure%20letter_05202013_text.pdf\n\n520130001M_notice of amendment_02262013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520130001M/520130001M_notice%20of%20amendment_02262013.pdf\n\n520130001M_notice of amendment_02262013_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520130001M/520130001M_notice%20of%20amendment_02262013_text.pdf\n\n520130001M_closure letter_05202013_text.pdf\n\nVIA UPS GROUND: 1Z WR2 588 03 9828 1717\nMay 20, 2013\nMr. Dan Britton\nPresident and CEO\nFairbanks Natural Gas, LLC\n3408 International Way\nFairbanks, AK 99701\nCPF 5-2013-0001M\nDear Mr. Britton:\nOn September 9-12, 2012, representatives from the Pipeline and Hazardous Materials Safety\nAdministration (PHMSA), pursuant to Chapter 601 of 49 United States Code, conducted an\non-site pipeline safety inspection of Fairbanks Natural Gas’ (FNG) procedures in Fairbanks,\nAlaska. As a result of the inspection, FNG was issued a Notice of Amendment on February,\n19, 2013, which proposed amendment of your procedures.\nFNG submitted its amended procedures on April 29, 2013. My staff reviewed the amended\nprocedures, and it appears that the inadequacies outlined in this Notice of Amendment have\nbeen corrected.\nThis letter is to inform you no further action is necessary and this case is now closed. Thank\nyou for your cooperation.\nSincerely,\nDennis Hinnah\nDeputy Director, Western Region\nPipeline and Hazardous Materials Safety Administration\ncc: PHP-60 Compliance Registry\nPHP-500 Jon Strawn (#139392)\n\n520130001M_notice of amendment_02262013_text.pdf\n\nNOTICE OF AMENDMENT\nUPS 2-DAY AIR - 1Z WR2 588 03 9156 1687\nFebruary 26, 2013\nMr. Dan Britton\nPresident and Chief Executive Officer\nFairbanks Natural Gas\n3408 International Way\nFairbanks, AK 99701\nCPF 5-2013-0001M\nDear Mr. Britton:\nOn September 9-11, 2012, representatives of the Pipeline and Hazardous Materials Safety\nAdministration (PHMSA), pursuant to Chapter 601 of 49 United States Code, inspected\nFairbanks Natural Gas’ (FNG) procedures and records for their Distribution Integrity\nManagement Program (DIMP) in Fairbanks, Alaska.\nAs a result of the inspection, PHMSA has identified inadequacies found within FNG’s DIMP\nplan as described below:\n1. §192.1007 What are the required elements of an integrity management plan?\nA written integrity management plan must contain procedures for developing\nand implementing the following elements:\n(a) Knowledge. An operator must demonstrate an understanding of its gas\ndistribution system developed from reasonably available information.\n(1) Identify the characteristics of the pipeline's design and operations and the\nenvironmental factors that are necessary to assess the applicable threats and\nrisks to its gas distribution pipeline.\nFNG’s DIMP procedures do not adequately describe the data sources used to gather\ninformation and knowledge of the system, e.g., subject matter experts consulted, information\ngathered from specific Operation and Maintenance and Inspection (OM&I) forms, records,\nsystem maps, etc.) Furthermore, the data sources that are used do not go beyond those\nrecommended by the Simple, Handy, Risk-based Integrity Management Plan (SHRIMP) that\n\n\n\nwas developed by the American Public Gas Association to assist distribution companies in\ncreating and implementing a DIMP. A SHRIMP plan is starting point for creating a\ncomprehensive DIMP, and must be expanded to include the unique risk threats that a\ndistribution company may be exposed to. The FNG SHRIMP reviewed do not reflect unique\nthreats to the system imposed by Arctic conditions. There are other data sources that must be\nconsidered, e.g. the condition of connections at a dwelling to see if there are problems due to\nfrost heaving that may have shifted the ground and joint and fitting connections. In addition,\nthe PHMSA inspectors found that the risks posed by gas corrosivity and components that\nlimited Maximum Allowable Operating Pressure were not well defined.\nChapter 3, “Knowledge of System” includes no provisions for periodic updates (i.e.\nreviewing, collecting and consolidating of data sources beyond the two year plan review\nperiod. Data sources exist that are not captured in the procedures other than those listed in\nSection 11.2. This section is only the minimum of data sources recommended by the\nSHRIMP software and does not reflect data sources that are needed to perform a threat\nassessment that takes into account the unique Arctic environment. Additionally, procedures\nto consolidate information on a periodic basis are not provided in Chapter 3, Knowledge of\nthe Distribution System.\nFNG did not adequately describe the process (who, what, when, where) to improve the\noperator’s knowledge of its gas distribution system, especially the environmental risk factors\nthat may pose a risk to its pipelines and appurtenances. FNG’s DIMP plan must provide\nprocedures for identifying, listing, and collecting, as appropriate, additional data and\ninformation that is needed to fill gaps in knowledge and information due to missing,\ninaccurate, or incomplete records, and to consolidate information on a periodic basis.\n2. §192.1007 What are the required elements of an integrity management plan?\nA written integrity management plan must contain procedures for developing\nand implementing the following elements:\n(a) Knowledge. An operator must demonstrate an understanding of its gas\ndistribution system developed from reasonably available information.\n(3) Identify additional information needed and provide a plan for gaining that\ninformation over time through normal activities conducted on the pipeline (for\nexample, design, construction, operations or maintenance activities).\nFNG’s DIMP process does not adequately identify additional information needed to fill\ninformation gaps that could be used to increase the knowledge of their system.\nA procedure must be developed so that if an incident occurs, there is a way to collect\ninformation to see if the problem exists on other parts of the system. FNG’s DIMP plan,\nChapter 11.1, Section C, states, \"The following gaps identified by FAIRBANKS NATURAL\nGAS: FAIRBANKS NATURAL GAS will implement as follows; No additional information\nneeded.\"\nFNG’s DIMP must include a process to gain additional information over time.\n2\n\n\n\n3. §192.1007 What are the required elements of an integrity management plan? A\nwritten integrity management plan must contain procedures for developing and\nimplementing the following elements:\n(b) Identify threats. The operator must consider the following categories of\nthreats to each gas distribution pipeline: corrosion, natural forces, excavation\ndamage, other outside force damage, material or welds, equipment failure,\nincorrect operations, and other concerns that could threaten the integrity of its\npipeline. An operator must consider reasonably available information to identify\nexisting and potential threats. Sources of data may include, but are not limited\nto, incident and leak history, corrosion control records, continuing surveillance\nrecords, patrolling records, maintenance history, and excavation damage\nexperience.\nFNG’s DIMP plan does not detail the specific processes used to identify all existing and\npotential threats that describe how subject matter experts gather and input information into\nDIMP for the threat assessment. FNG’s DIMP has no procedures to gather data beyond\nthose risk categories explicitly listed in SHRIMP, either on FNG’s unique system or trends\nfound across the industry as they are identified. FNG’s DIMP plan procedures do not\naddress one of the most common threats unique to your system, frost heave. The FNG DIMP\nis also incomplete because it does not describe procedures for how it will receive updates\nfrom outside sources and consider them for incorporation into your DIMP. Outside sources\nmust include, but are not limited to, the following:\n• American Gas Association;\n• Informal meetings with Enstar Natural Gas; and\n• PHMSA Advisory Bulletins.\nFNG must consider all available information including how to solicit and gather information\nfor the threat assessment analysis, data identifying all potential and existing threats and all\ninformation required for creating a comprehensive threat analysis.\n4. §192.1007 What are the required elements of an integrity management plan?\nA written integrity management plan must contain procedures for developing\nand implementing the following elements:\n(c) Evaluate and rank risk. An operator must evaluate the risks associated with\nits distribution pipeline. In this evaluation, the operator must determine the\nrelative importance of each threat and estimate and rank the risks posed to its\npipeline. This evaluation must consider each applicable current and potential\nthreat, the likelihood of failure associated with each threat, and the potential\nconsequences of such a failure. An operator may subdivide its pipeline into\nregions with similar characteristics (e.g., contiguous areas within a distribution\npipeline consisting of mains, services and other appurtenances; areas with\ncommon materials or environmental factors), and for which similar actions\nlikely would be effective in reducing risk….\n(f) Periodic Evaluation and Improvement. An operator must re-evaluate threats\nand risks on its entire pipeline and consider the relevance of threats in one\n3\n\n\n\nlocation to other areas. Each operator must determine the appropriate period\nfor conducting complete program evaluations based on the complexity of its\nsystem and changes in factors affecting the risk of failure. An operator must\nconduct a complete program re-evaluation at least every five years. The operator\nmust consider the results of the performance monitoring in these evaluations.\nFNG’s DIMP procedures do not provide an adequate process to identify existing and\npotential threats AND to re-evaluate the rankings and justify those rankings on an ongoing\nbasis. FNG must re-evaluate the risk ranking process by determining the relative risk of each\npipeline threat and validate the results through FNG’s DIMP. FNG should also add, “natural\nforces” and “workmanship defects” in addition to “outside force damage” caused by\nexcavation. Based on information reviewed by the inspectors, above ground vehicle strikes\nand “poor workmanship” downstream of the meters are higher risks not currently considered\nin their risk rankings. FNG must also document justification of its ranking on an ongoing\nbasis in the DIMP procedures in Section 5, page 14).\n5. §192.1007(e) What are the required elements of an integrity management plan?\nA written integrity management plan must contain procedures for developing\nand implementing the following elements:\n(e) Measure performance, monitor results, and evaluate effectiveness.\n(1) Develop and monitor performance measures from an established baseline to\nevaluate the effectiveness of its IM program. An operator must consider the\nresults of its performance monitoring in periodically re-evaluating the threats\nand risks. These performance measures must include the following:\n(i) Number of hazardous leaks either eliminated or repaired as required by §\n192.703(c) of this subchapter (or total number of leaks if all leaks are repaired\nwhen found), categorized by cause;\n(ii) Number of excavation damages;\n(iii) Number of excavation tickets (receipt of information by the underground\nfacility operator from the notification center);\n(iv) Total number of leaks either eliminated or repaired, categorized by cause;\n(v) Number of hazardous leaks either eliminated or repaired as required by §\n192.703(c) (or total number of leaks if all leaks are repaired when found),\ncategorized by material; and\n(vi) Any additional measures the operator determines are needed to evaluate the\neffectiveness of the operator's IM program in controlling each identified threat.\nFNG’s DIMP procedures do not contain an adequate process for establishing baselines for\nperformance measures from which to monitor effectiveness of its DIMP program. FNG does\nnot have an adequate process for taking additional safety measures after the operator\nintegrates and evaluates all known risks. FNG must have a process to monitor the\nperformance measures in compliance with §192.1007(e) and to implement additional risk-\nreducing measures where applicable. Further, FNG’s procedures are inadequate to measure\neffectiveness of additional risk-reducing measures as required by §192.1007(e)(1)(vi) since\nno preventative steps are being taken beyond those required by Federal pipeline safety\nregulations. Regardless of the fact that currently no additional risk reduction measures are\n4\n\n\n\nbeing proposed or implemented, procedures must exist to establish a performance baseline\nwhich future improvements can be measured against.\n6. §192.1007(f) What are the required elements of an integrity management plan?\nA written integrity management plan must contain procedures for developing\nand implementing the following elements:\n(f) Periodic Evaluation and Improvement. An operator must re- evaluate\nthreats and risks on its entire pipeline and consider the relevance of threats in\none location to other areas. Each operator must determine the appropriate\nperiod for conducting complete program evaluations based on the complexity of\nits system and changes in factors affecting the risk of failure. An operator must\nconduct a complete program re-evaluation at least every five years. The operator\nmust consider the results of the performance monitoring in these evaluations.\nFNG’s DIMP procedures do not contain an adequate process that describes the details of how\nit will conduct periodic evaluations. The DIMP periodic evaluations process does not contain\nan evaluation of program effectiveness to determine if modifications to the program need to\nbe made including risk prioritization results, risk control practices, failure analysis results and\nperformance measures. The written procedures for periodic review do not include the\nfrequency of review (not to exceed 5 years, based on the complexity of the system and\nchanges in factors affecting the risk of failure), the verification of general information (e.g.\ncontact information, form names, action schedules, etc.), or incorporating new system\ninformation (re-evaluating threats and risks, reviewing the frequency and the effectiveness of\nthe measures to reduce risk, and modifying measures to reduce risk).\n7. §192.1011 What records must an operator keep? An operator must maintain\nrecords demonstrating compliance with the requirements of this subpart for at\nleast 10 years. The records must include copies of superseded integrity\nmanagement plans developed under this subpart.\nFNG’s procedures are inadequate and general in nature in that FNG’s DIMP plan does not\ncontain an adequate process to record the various forms and documents used in the threat\nidentification section, and it does not require that the documents be retained for 10 years.\nFNG’s DIMP must include the requirement that the OM&I forms and documentation used to\ndemonstrate compliance with §192 Subpart P be retained for 10 years.\nResponse to this Notice\nThis Notice is provided pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.237. Enclosed\nas part of this Notice is a document entitled Response Options for Pipeline Operators in\nCompliance 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\nfor confidential treatment under 5 U.S.C. 552(b), along with the complete original document\nyou must 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\n5\n\n\n\ninformation qualifies for confidential treatment under 5 U.S.C. 552(b). If you do not respond\nwithin 30 days of receipt of this Notice, this constitutes a waiver of your right to contest the\nallegations in this Notice and authorizes the Associate Administrator for Pipeline Safety to\nfind facts as alleged in this Notice without further notice to you and to issue a Final Order.\nIf, after opportunity for a hearing, your plans or procedures are found inadequate as alleged\nin this Notice, you may be ordered to amend your plans or procedures to correct the\ninadequacies (49 C.F.R. § 190.237). If you are not contesting this Notice, we propose that\nyou submit your amended procedures to my office within thirty (30) days of receipt of this\nNotice. This period may be extended by written request for good cause. Once the\ninadequacies identified herein have been addressed in your amended procedures, this\nenforcement action will be closed.\nIt is requested (not mandated) that Fairbanks Natural Gas maintain documentation of the\nsafety improvement costs associated with fulfilling this Notice of Amendment\n(preparation/revision of plans, procedures) and submit the total to Chris Hoidal, Director,\nWestern Region, Pipeline and Hazardous Materials Safety Administration.\nIn correspondence concerning this matter, please refer to CPF 5-2013-0001M and send all\ndocuments to our office at 188 W. Northern Lights Blvd., Suite 520, Anchorage AK, 99503,\nand for each document you submit please provide a copy in electronic format whenever\npossible.\nSincerely,\nDennis Hinnah\nDeputy Director, Western Region\nPipeline and Hazardous Materials Safety Administration\nEnclosure: Response Options for Pipeline Operators in Compliance Proceedings\ncc: PHP-60 Compliance Registry\nPHP-500 J. Strawn (#139392)\n6","truncated":false,"body_characters":18298}