{"operation":"document","citation":"CPF 520135005","title":"SINCLAIR TRANSPORTATION COMPANY — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2013-04-25","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.264, 195.402(a), 195.505.","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520135005.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520135005.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520135005","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520135005","body":"Notice of Probable Violation involving SINCLAIR TRANSPORTATION COMPANY. PHMSA's enforcement data identifies the cited regulations as 195.264,  195.402(a),  195.505. The case was opened on 2013-04-25 and is reported as closed as of 2014-03-20. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520135005_Final Order_03202014.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520135005/520135005_Final%20Order_03202014.pdf\n\n520135005_Final Order_03202014_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520135005/520135005_Final%20Order_03202014_text.pdf\n\n520135005_NOPV PCO_04252013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520135005/520135005_NOPV%20PCO_04252013.pdf\n\n520135005_NOPV PCO_04252013_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520135005/520135005_NOPV%20PCO_04252013_text.pdf\n\n520135005_operator response_06142013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520135005/520135005_operator%20response_06142013.pdf\n\n520135005_Final Order_03202014_text.pdf\n\nMARCH 20, 2014\nMr. Peter Johnson\nPresident\nSinclair Transportation Company\n550 East South Temple\nSalt Lake City, UT 84102\nRe: CPF No. 5-2013-5005\nDear Mr. Johnson:\nEnclosed please find the Final Order issued in the above-referenced case. It withdraws one\nallegation of violation, makes other findings of violation, and finds that Sinclair Transportation\nCompany has completed the actions specified in the Notice to comply with the pipeline safety\nregulations. Therefore, this case is now closed. Service of the Final Order by certified mail is\ndeemed effective upon the date 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. Mark A. Petersen, Vice-President, Sinclair Transportation Company\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED [INSERT RECEIPT NO.]\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)\nSinclair Transportation Company, ) CPF No. 5-2013-5005\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nFrom July 10 to July 12, 2012, pursuant to 49 U.S.C. § 60117, representatives of the Pipeline and\nHazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),\nconducted an on-site pipeline safety inspection of the Denver Products Terminal facilities and\nrecords of Sinclair Transportation Company (Sinclair or Respondent) in Henderson, Colorado.\nSinclair, a wholly-owned subsidiary of Sinclair Oil Corporation, operates approximately 1,100\nmiles of crude oil and refined products pipelines in Wyoming, Colorado, Missouri, and Iowa.1\nAs a result of the inspection, the Director, Western Region, OPS (Director), issued to\nRespondent, by letter dated April 25, 2013, a Notice of Probable Violation and Proposed\nCompliance Order (Notice). In accordance with 49 C.F.R. § 190.207, the Notice proposed\nfinding that Sinclair had committed five violations of 49 C.F.R. Part 195 and proposed ordering\nRespondent to take certain measures to correct the alleged violations.\nSinclair responded to the Notice by letter dated June 14, 2013 (Response). The company\ncontested four of the allegations of violation and provided information concerning the corrective\nactions it had taken. Respondent did not request a hearing and therefore has waived its right to\none.\nFINDINGS OF VIOLATION\nThe Notice alleged that Respondent violated 49 C.F.R. Part 195, as follows:\n1 PHMSA Violation Report at 1.\n\n\n\n2\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.264, which states, in\nrelevant part:\n§ 195.264 Impoundment, protection against entry, normal/\nemergency venting or pressure/vacuum relief for aboveground\nbreakout tanks.\n(a) . . .\n(d) Normal/emergency relief venting must be provided for each\natmospheric pressure breakout tank. Pressure/vacuum-relieving devices\nmust be provided for each low-pressure and high-pressure breakout tank.\n(e) For normal/emergency relief venting and pressure/vacuum-\nrelieving devices installed on aboveground breakout tanks after October 2,\n2000, compliance with paragraph (d) of this section requires the following\nfor the tanks specified: . . .\n(2) Normal/emergency relief venting installed on atmospheric\npressure tanks (such as those built to API Standard 650 or its predecessor\nStandard 12C) must be in accordance with API Standard 2000\n(incorporated by reference, see § 195.3); . . . .\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.264 by failing to meet the\nrequirement for venting capacity for maximum liquid movement into or out of a breakout tank.\nSpecifically, the Notice alleged that Sinclair did not document the method of calculation used to\ndetermine maximum flow rates for normal/emergency relief vents of its breakout tanks.\nAccording to the Notice, Sinclair was required to comply with API Standard 2000 with respect to\nnormal/emergency relief vents, which requires that the method of calculation used by the\ncompany be properly documented.\nIn its Response, Sinclair explained that the breakout tank vents in question were installed during\nthe 1963 to 1969 period and argued that the provisions of § 195.264(e) only apply to pressure/\nvacuum-relieving devices installed on aboveground tanks after October 2, 2000. Respondent is\ncorrect that the provisions of § 195.264(e) do not apply to these tank vents.\nAccordingly, after considering all of the evidence and the legal issues presented, I find that\nSinclair was not out of compliance with § 195.264 as alleged in the Notice. Based upon the\nforegoing, I hereby order that Item 1 be withdrawn.\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. § 195.402(a), which states:\n§ 195.402 Procedural manual for operations, maintenance, and\nemergencies.\n(a) General. Each operator shall prepare and follow for each pipeline\nsystem a manual of written procedures for conducting normal operations\nand maintenance activities and handling abnormal operations and\nemergencies. This manual shall be reviewed at intervals not exceeding 15\nmonths, but at least once each calendar year, and appropriate changes\nmade as necessary to insure that the manual is effective. This manual shall\n\n\n\n3\nbe prepared before initial operations of a pipeline system commence, and\nappropriate parts shall be kept at locations where operations and\nmaintenance activities are conducted.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.402(a) by failing to follow its own\nmanual of written procedures for conducting normal operations and maintenance (O&M)\nactivities for tank foundations. Specifically, the Notice alleged that Sinclair failed to follow its\nown procedures, which provided for inspections and inspection intervals established in\naccordance with API Standard 653. According to the Notice, the PHMSA inspection revealed\nseveral instances of cracked concrete and corrosion in the area of the tank foundations.\nFurthermore, certain concrete tank foundation cracks were allegedly not repaired as required by\nAPI Standard 653, and Sinclair did not follow-up on the recommendations of its tank inspector\nthat these cracks be sealed to prevent further cracking.\nIn its Response, Sinclair contended that the cracks in the tank foundations were “hairline” or\n“temperature” cracks and, in its view, not required to be repaired under API 653 because they did\nnot “seriously affect the strength of the concrete structure.”2 Sinclair further argued that its\ncontractor had determined that the cracks would not permit moisture infiltration and corrosion of\nthe reinforcing steel, and stated that the corrosion observed in the area of the tank foundations\nwas more likely due to corrosion on the tank chimes, for which PHMSA had issued a Warning\nLetter. Following receipt of the Notice, however, Sinclair did caulk and seal “a total of eight to\ntwelve foundation cracks on Tanks 11, 12, and 13 that were determined to be 1/8 to 1/4-inch in\nwidth.”3\nHaving considered Respondent’s arguments, I do not find them persuasive. API 653 Section\n4.5.1.2(c) states: “Expansion of freezing moisture in porous concrete, or in concrete with minor\nsettlement cracks or temperature cracks, can result in spalling and/or the development of serious\nstructural cracks.” The Denver area is subject to seasonal precipitation and freezing\ntemperatures, which can result in the expansion of moisture in cracks. API 653 requires the\nrepairing of cracks before they become serious enough to affect the strength of the concrete\nstructure.\nAccordingly, after considering all of the evidence and the legal issues presented, I find that\nRespondent violated 49 C.F.R. § 195.402(a) by failing to follow its own written procedures for\nrepairing tank foundation cracks as part of conducting normal O&M activities for breakout tanks.\nItem 3: The Notice alleged that Respondent violated 49 C.F.R. § 195.402(a), as quoted above,\nby failing to follow its own manual of written procedures for conducting normal O&M activities\nfor establishing internal tank inspections. Specifically, the Notice alleged that Sinclair failed to\nfollow its own O&M Manual Section 206.6(e), which required that the tank inspection intervals\nbe based upon the calculations described in API 653, Sections 6.4.2,and 6.4.3. According to the\nNotice, the company failed to document the calculations used to establish the internal inspection\ninterval for each tank.\n2 Response at 3, citing API Standard 653, Section 4.5.1.2(e).\n3 Response at 4.\n\n\n\n4\nIn its Response, Sinclair acknowledged that the calculation was not fully documented for five of\nthe 12 internal inspections and did not contest the allegation of violation. Accordingly, based\nupon a review of all of the evidence, I find that Respondent violated 49 C.F.R. § 195.402(a) by\nfailing to follow its own manual of written procedures for conducting normal O&M activities for\nestablishing internal tank inspection intervals.\nItem 4: The Notice alleged that Respondent violated 49 C.F.R. § 195.402(a), as quoted above,\nby failing to follow its own manual of written procedures for conducting normal O&M activities\nfor establishing external tank inspections. Specifically, the Notice alleged that Sinclair failed to\nfollow its O&M Manual Section 206.6(e) because it did not document a valid calculation method\nused to establish the external inspection interval for each tank.\nIn its Response, Sinclair disagreed that it had committed a violation and contended that it had\nused a calculation method that was “algebraically equivalent” to the method set forth in Section\n206.6. Respondent stated that it believed the RCA/4N method in its O&M procedures (where\nRCA is the shell corrosion allowance in millimeters and N is the shell corrosion rate in\nmillimeters per year) was equivalent to the RL = Ca/Cr method it had used (where RL is\nRemaining Life, Ca is the corrosion allowance in inches, and Cr is the Corrosion Rate in inches\nper year). Sinclair stated that once the remaining life is less than 20 years, the inspection interval\nderived when the remaining life is divided by 4 would be no greater than five years. Sinclair\nstated that the calculations it performed in effect reached the same result as the method provided\nin its O&M procedures.\nHaving considered Respondent’s arguments, I do not find them persuasive. As set forth in API\n653, the RCA/4N method calls for the actual measured thickness of the tank wall to be used in\nthe calculation, not the original wall thickness at the time of construction. Here, Respondent\nused the original wall thickness of the tank. For Tank No. 7, for example, Sinclair’s chart shows\nprevious 0.375” for course 1 and 0.250” for courses 2−5.4 These reflect the original thickness of\nthe tank as constructed in 1966, not the previous measured thickness. The most recent inspection\nof this tank in 2011 would have had to be based on the 2006 measurements, but it was not.\nFinally, I would note that operators are required to follow their written procedures as they are. If\nSinclair believes that two alternative formulas are appropriate for a given type of calculation, it\nwould first need to amend its O&M procedures accordingly and not begin using the alternative\nformula until after the amendment had become effective.\nAccordingly, after considering all of the evidence and the legal issues presented, I find that\nRespondent violated 49 C.F.R. § 195.402(a) by failing to follow its own manual of written\nprocedures for conducting normal O&M activities for establishing external tank inspections.\nItem 5: The Notice alleged that Respondent violated 49 C.F.R. § 195.505, which states, in\nrelevant part:\n4 Response Exhibit G.\n\n\n\n5\n§ 195.505 Qualification program.\nEach operator shall have and follow a written qualification program.\nThe program shall include provisions to:\n(a) Identify covered tasks;\n(b) Ensure through evaluation that individuals performing covered\ntasks are qualified;\n(c) Allow individuals that are not qualified pursuant to this subpart to\nperform a covered task if directed and observed by an individual that is\nqualified; . . . .\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.505 by failing to have and follow a\nwritten qualification program that included a provision allowing an individual who had not been\nqualified pursuant to Subpart G to perform a covered task only if such person were directed and\nobserved by an individual who was qualified. Specifically, the Notice alleged that the individual\nwho performed the monthly breakout tank inspections for Sinclair was not qualified to perform\nthis task, as evidenced by his failure to properly record the cracks in the concrete foundations as\nunsatisfactory conditions on the tank inspection checklist or to acquire the proper tool to measure\nsuch cracks.\nIn its Response, Sinclair disagreed that it had committed a violation and provided documentation\ndemonstrating that the individual who performed the monthly tank inspections was qualified in\naccordance with its written qualification program.5 Respondent disputed the premise that the\ninspector should have recorded the condition of the foundations as unsatisfactory on his checklist\nfor the reasons given in its response to Item 2 above. Respondent further argued that its breakout\ntank inspectors “are not necessarily charged with measuring foundation cracks, whether\nstructural or not, but only in monitoring them monthly to determine whether the condition of the\nfoundations appear to be deteriorating, hence satisfactory or unsatisfactory.”6\nRespondent’s argument that the tank inspector should not have recorded the condition of the\nfoundations as unsatisfactory is unpersuasive for the reasons discussed in Item 2 above, namely,\nthat the cracks required repair pursuant to API 653. Respondent’s argument that its breakout\ntank inspectors were not charged with measuring cracks is at odds with its contention that the\ntank foundations were being effectively monitored. Unless individual cracks are measured,\nmarked, or numbered, it would not be feasible for an inspector to know, from memory, whether\nan existing crack had grown or whether a new one had appeared. The examination required by\ncovered task SPL-2710 is for the purpose of identifying visual defects or damage that need to be\naddressed, such as cracks in a foundation. The tank inspector in this case failed to make and\nrecord these observations in a way that would result in follow-up action.\nAccordingly, after considering all of the evidence and the legal issues presented, I find that\nRespondent violated 49C.F.R. § 195.505 by failing to have and follow a written qualification\nprogram that included a provision allowing an individual who had not been qualified pursuant to\nSubpart G to perform a covered task only if such person were directed and observed by an\n5 Response, Exhibit H.\n6 Response at 10.\n\n\n\n6\nindividual who had been qualified.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Items 1−5 in the Notice for violations of\n49 C.F.R. §§ 195.264, 195.402(a), and 195.505. Under 49 U.S.C. § 60118(a), each person who\nengages in the transportation of hazardous liquids or who owns or operates a pipeline facility is\nrequired to comply with the applicable safety standards established under chapter 601. As\ndiscussed above, Item 1 has been withdrawn. With respect to Items 2−5, the Director indicates\nthat Respondent has taken the following actions specified in the proposed compliance order:\nWith respect to the violations of §§ 195.402(a) and 195.505 (Items 2−5) pertaining\nto the tank foundations and internal inspection intervals and its qualification program,\nRespondent has repaired the cracks in the concrete foundations that were identified,\nhad re-trained the qualified individuals in this area, and has documented the\nappropriate internal and external inspection intervals for all of the breakout tanks.\nAccordingly, I find that compliance has been achieved with respect to these violations.\nTherefore, the compliance terms proposed in the Notice are not included in this Order.\nUnder 49 C.F.R. § 190.215, Respondent has a right to submit a petition for reconsideration of\nthis Final Order. Should Respondent elect to do so, the petition must be sent to: Associate\nAdministrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey Avenue, SE, East Building,\n2nd Floor, Washington, DC 20590, with a copy sent to the Office of Chief Counsel, PHMSA, at\nthe same address. PHMSA will accept petitions received no later than 20 days after receipt of\nservice of this Final Order by the Respondent, provided they contain a brief statement of the\nissue(s) and meet all other requirements of 49 C.F.R. § 190.215. Unless the Associate\nAdministrator, upon request, grants a stay, the terms and conditions of this Final Order are\neffective upon service in accordance with 49 C.F.R. § 190.5.\n___________________________________ __________________________\nJeffrey D. Wiese Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":18418}