NORTH SLOPE BOROUGH ENERGY MANAGEMENT — Notice of Amendment

party submissionOfficial PDF520160019M_Operator Response to Notice_11092018.pdf#

520160019M_Closure Letter_01152019_text.pdf, page 1Official PDFCERTIFIED MAIL - RETURN RECEIPT REQUESTED January 15, 2019 The Honorable Harry K. Brower, Jr., Mayor Mayor of the North Slope Borough North Slope Borough Energy Management Nuiqsut Utilities Cooperative P.O. Box 69 Barrow, Alaska 99723 CPF 5-2016-0019M Closure Letter Dear Mayor Brower: On October 30, 2018, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued to North Slope Borough Energy Management an Order Directing Amendment in the above-referenced case. This Order included a requirement to amend your procedures. Based on our review of the documentation you provided, it has been determined that you have complied with the terms of this Order. Accordingly, this case is now closed and no further action is contemplated with respect to the matters involved in this case. Thank you for your cooperation in this matter. Sincerely, Chris Hoidal Acting Director, Western Region Pipeline and Hazardous Materials Safety Administration cc: PHP-60 Compliance Registry PHP-500 Jake Gano (#153508) Mr. Erik Danner, Division Manager Fuel and Natural Gas#

520160019M_Order Directing Amendment_10302018_text.pdf, page 1Official PDFOctober 30, 2018 The Honorable Harry K. Brower, Jr., Mayor North Slope Borough P. O. Box 69 Barrow, Alaska 99723 Re: CPF No. 5-2016-0019M Dear Mayor Brower: Enclosed please find the Order Directing Amendment issued in the above-referenced case. It makes findings of inadequate procedures and requires that North Slope Borough Energy Management, a division of the North Slope Borough, amend certain operating and maintenance procedures for its gas distribution system and submit such procedures to PHMSA within 30 days of receipt of this Order. When the amendment of procedures has been completed, as determined by the Director, Western Region, this enforcement action will be closed. Service of the Order by certified mail is effective upon the date of mailing, as provided under 49 C.F.R. § 190.5. Thank you for your cooperation in this matter. Sincerely, Alan K. Mayberry Associate Administrator for Pipeline Safety Enclosure cc: Ms. Kim West, Director, Western Region, Office of Pipeline Safety, PHMSA Mr. James Wolgemouth, Fuel Division, Department of Public Works, North Slope Borough Energy Management, P. O. Box 69, Barrow, Alaska 99723 CERTIFIED MAIL - RETURN RECEIPT REQUESTED#

520160019M_Order Directing Amendment_10302018_text.pdf, page 2U.S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY WASHINGTON, D.C. 20590 ________________________________________________ In the Matter of ) North Slope Borough Energy Management, a division ) of North Slope Borough, Alaska, ) CPF No. 5-2016-0019M a municipal corporation, ) ) ) ) Respondent. ) ________________________________________________) ORDER DIRECTING AMENDMENT From July 11-15, 2016, pursuant to 49 U.S.C. § 60117, representatives of the Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS), conducted an inspection of the procedures of Nuiqsut Utilities Cooperative, which is part of North Slope Borough Energy Management (North Slope or Respondent) in Nuiqsut, Alaska. North Slope, a division of the Department of Public Works, North Slope Borough, operates and maintains the power plants and distribution of electric energy in seven villages on the North Slope of Alaska, including a natural gas distribution pipeline system.1 The Nuiqsut Utilities Cooperative operates the local natural gas distribution system comprised of almost 4 miles of mains and 163 miles of plastic distribution piping.2 As a result of the inspection, the Director, Western Region, OPS (Director), issued to Respondent, by letter dated October 6, 2016, a Notice of Amendment (Notice). In accordance with 49 C.F.R. § 190.206, the Notice proposed finding that certain of North Slope’s plans and procedures were inadequate to assure safe operation of its pipeline facilities and proposed that Respondent amend its procedures for operations, maintenance, and emergencies. Respondent failed to respond within 30 days of receipt of service of the Notice.3 Under 49 C.F.R. § 190.208(d), such failure to respond constitutes a waiver of North Slope’s right to contest the allegations in the Notice and authorizes the Associate Administrator, without further 1 See http://www.north-slope.org/departments/public-works/utilities-power-lights. Current as of July 7, 2017. 2 See North Slope Borough Energy Management 2016 PHMSA Annual Report: https://primis.phmsa.dot.gov/comm/reports/operator/OperatorReport opid 31142.html?nocache=7767. 3 The Borough accepted service on October 14, 2016. See U.S. Postal Service Certified Mail Receipt (on file with PHMSA).#

520160019M_Order Directing Amendment_10302018_text.pdf, page 3CPF No. 5-2016-0019M Page 2 notice, to find facts as alleged in the Notice and issue this Order Directing Amendment (Order) under § 190.206. In this instance, PHMSA also contacted Respondent by telephone to discuss the issues in the Notice with North Slope.4 Considering such circumstances and the safety concerns raised in the Notice, I find it reasonable and appropriate to enter this Final Order without further proceedings. FINDINGS OF INADEQUATE PROCEDURES The Notice alleged certain inadequacies in Respondent’s Gas Operating and Maintenance (O&M) Manual and the Nuiqsut Gas Distribution System Pipeline-Specific Operating Manual (PSOM), and proposed requiring North Slope to amend its procedures to ensure safe operations as follows: Item 1: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 192.605(b)(1), which states: § 192.605 Procedural manual for operations, maintenance, and emergencies. (a) … (b) Maintenance and normal operations. The manual required by paragraph (a) of this section must include procedures for the following, if applicable, to provide safety during maintenance and operations. (1) Operating, maintaining, and repairing the pipeline in accordance with each of the requirements of this subpart and subpart M of this part. The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 192.605(b)(1) because North Slope’s O&M Manual and the PSOM did not include adequate procedures for conducting periodic odorant sampling required by § 192.625(f). Specifically, the PSOM indicated that "sniff testing" was performed but did not specify how or where the tests were to be conducted. Respondent did not contest this allegation. Accordingly, based upon a review of all the evidence, I find that Respondent’s procedures were inadequate as alleged in the Notice. Respondent is hereby ordered to amend its O&M manual and PSOM to specify how the periodic sampling required by § 192.625(f) will be performed. Item 2: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 192.615(a)(3)(ii), which states: § 192.615 Emergency plans. (a) Each operator shall establish written procedures to minimize the hazard 4 In its Region Recommendation, OPS indicated that an inspector from the OPS Alaska Office spoke with Mr. James Wolgemouth in the Borough’s Department of Public Works on two occasions in January/ February 2017 and then left several follow-up voice messages. According to PHMSA records, no one from the North Slope Borough responded to the calls or filed any written response to the Notice.#

520160019M_Order Directing Amendment_10302018_text.pdf, page 4CPF No. 5-2016-0019M Page 3 resulting from a gas pipeline emergency. At a minimum, the procedures must provide for the following: (1) … (3) Prompt and effective response to a notice of each type of emergency, including the following: (i) … (ii) Fire located near or directly involving a pipeline facility. . . . The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 192.615(a)(3)(ii) because its Emergency Plan (pages 183-191 of the O&M Manual) did not contain provisions to address a fire on the pipeline facility. Specifically, the Notice alleged that NSB's Emergency Plan did not include plans to address a fire at the Pressure Reducing Valve (PRV) station, where high-pressure gas is present and flammable odorant is stored nearby. Respondent did not contest this allegation. Accordingly, based upon a review of all the evidence, I find that Respondent’s procedures were inadequate as alleged in the Notice. North Slope is hereby ordered to amend its O&M Manual and PSOM to include plans to address a fire at the PRV station, where high-pressure gas is present and flammable odorant is stored nearby. Item 3: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 192.615(a)(4), which states: § 192.615 Emergency plans. (a) Each operator shall establish written procedures to minimize the hazard resulting from a gas pipeline emergency. At a minimum, the procedures must provide for the following: (1) … (4) The availability of personnel, equipment, tools, and materials, as needed at the scene of an emergency. The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 192.615(a)(4) because they failed to reflect the emergency equipment that was available to North Slope personnel during a gas pipeline emergency. Specifically, the Notice alleged that North Slope's Emergency Plan procedures specified the use of two-way radios; however, responders in Nuiqsut were not equipped with two-way radios. Respondent did not contest this allegation. Accordingly, based upon a review of all of the evidence, I find that Respondent’s procedures were inadequate as alleged in the Notice. North Slope is hereby ordered to amend its Emergency Plan to reflect which equipment and tools are available to emergency response personnel in Nuiqsut to ensure that equipment is sufficient for a “prompt and effective response to a notice of each type of emergency,” as required under § 192.615(a)(3). Item 4: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 192.615(a)(10), which states: § 192.615 Emergency plans.#

520160019M_Order Directing Amendment_10302018_text.pdf, page 5CPF No. 5-2016-0019M Page 4 (a) Each operator shall establish written procedures to minimize the hazard resulting from a gas pipeline emergency. At a minimum, the procedures must provide for the following: (1) ... (10) Beginning action under §192.617, if applicable, as soon after the end of the emergency as possible. The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 192.615(a)(10) because they failed to include provisions to initiate an investigation following an emergency response. Specifically, the Notice alleged that North Slope’s Emergency Plan did not include procedures to begin an investigation of a failure as soon after the end of the emergency as possible. Respondent did not contest this allegation. Accordingly, based upon a review of all the evidence, I find that Respondent’s procedures were inadequate as alleged in the Notice. North Slope is hereby ordered to amend its Emergency Plan to provide specific procedures for beginning an investigation of a failure as soon after the end of the emergency as possible. Item 5: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 192.617, which states: § 192.617 Investigation of failures. Each operator shall establish procedures for analyzing accidents and failures, including the selection of samples of the failed facility or equipment for laboratory examination, where appropriate, for the purpose of determining the causes of the failure and minimizing the possibility of a recurrence. The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 192.617 because they failed to include procedures for analyzing accidents and failures, including the selection of samples of the failed facility or equipment for laboratory examination, where appropriate, to determine the causes of the failure and minimizing the possibility of a recurrence. Respondent did not contest this allegation. Accordingly, based upon a review of all the evidence, I find that Respondent’s procedures were inadequate as alleged in the Notice. North Slope is hereby ordered to amend its procedures to include provisions to investigate and analyze accidents and failures. Pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.206, North Slope is ordered to revise its procedures as specified in Items 1 through 5, above. North Slope must submit the amended procedures to the Director, Western Region, within 30 days following receipt of this Order. The Director may grant an extension of time to comply with any of the required items upon a written request timely submitted by the Respondent and demonstrating good cause for an extension. Failure to comply with this Order may result in the administrative assessment of civil penalties#

520160019M_Order Directing Amendment_10302018_text.pdf, page 6CPF No. 5-2016-0019M Page 5 not to exceed $200,000, as adjusted for inflation (49 C.F.R. § 190.223), for each violation for each day the violation continues or in referral to the Attorney General for appropriate relief in a district court of the United States. The terms and conditions of this Order Directing Amendment are effective upon service in accordance with 49 C.F.R. § 190.5. October 30, 2018 ___________________________________ __________________________ Alan K. Mayberry Date Issued Associate Administrator for Pipeline Safety#

520160019M_Notice of Amendment_10062016_text.pdf, page 1Official PDFNOTICE OF AMENDMENT CERTIFIED MAIL - RETURN RECEIPT REQUESTED October 6, 2016 The Honorable Harry K. Brower, Jr. Mayor of the North Slope Borough North Slope Borough Energy Management Nuiqsut Utilities Cooperative P.O. Box 69 Barrow, Alaska 99723 CPF 5-2016-0019M Dear Mayor Brower: On July 11 through 15, 2016, representatives of the Pipeline and Hazardous Materials Safety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code, inspected the Nuiqsut Utility Cooperative’s procedures for Operations and Maintenance and Emergency Plans in Nuiqsut, Alaska. On the basis of the inspection, PHMSA has identified the apparent inadequacies found in NSB’s plans or procedures, as described below: 1. §192.605 Procedural manual for operations, maintenance, and emergencies. …(b) Maintenance and normal operations. The manual required by paragraph (a) of this section must include procedures for the following, if applicable, to provide safety during maintenance and operations. (1) Operating, maintaining, and repairing the pipeline in accordance with each of the requirements of this subpart and subpart M of this part. The North Slope Borough’s (NSB) Gas Operations and Maintenance (O&M) Manual and the Nuiqsut Gas Distribution System Pipeline-Specific Operating Manual (PSOM) did not include adequate procedures for conducting periodic odorant sampling required by §192.625(f). The PSOM indicates that “sniff testing” is done but does not specify how or where the tests are to be conducted. NSB must amend their procedures to specify how the periodic odorant sampling will#

520160019M_Notice of Amendment_10062016_text.pdf, page 2be done. 2. §192.615 Emergency Plans (a) Each operator shall establish written procedures to minimize the hazard resulting from a gas pipeline emergency. At a minimum, the procedures must provide for the following: …(3) Prompt and effective response to a notice of each type of emergency, including the following: …(ii) Fire located near or directly involving a pipeline facility. The NSB’s Emergency Plan (pages 183-191 of the O&M Manual) did not contain provisions to address a fire on the pipeline facility. NSB must revise their PSOM to include plans to address a fire at the Pressure Reducing Valve (PRV) station, where high-pressure gas is present and flammable odorant is stored nearby. 3. §192.615 Emergency Plans (a) Each operator shall establish written procedures to minimize the hazard resulting from a gas pipeline emergency. At a minimum, the procedures must provide for the following: …(4) The availability of personnel, equipment, tools, and materials, as needed at the scene of an emergency. The NSB’s Emergency Plan procedures specify the use of two-way radios; however, responders in Nuiqsut are not equipped with two-way radios. NSB must review and amend their Emergency Plan to reflect equipment and tools which available to emergency response personnel in Nuiqsut. The equipment specified in the Emergency Plan must be sufficient for a “prompt and effective response to a notice of each type of emergency,” per §192.615(a)(3). 4. §192.615 Emergency Plans (a) Each operator shall establish written procedures to minimize the hazard resulting from a gas pipeline emergency. At a minimum, the procedures must provide for the following: …(10) Beginning action under §192.617, if applicable, as soon after the end of the emergency as possible. The NSB’s Emergency Plan procedures did not include provisions to initiate an investigation following the emergency response. NSB must amend their Emergency Plan to specific procedures for beginning investigation of failures following an emergency. 5. §192.617 Investigation of failures. Each operator shall establish procedures for analyzing accidents and failures, including the selection of samples of the failed facility or equipment for laboratory examination, where appropriate, for the purpose of determining the causes of the failure and minimizing the possibility of a recurrence.#

520160019M_Notice of Amendment_10062016_text.pdf, page 3The NSB did not establish written procedures to investigate and analyze failures. establish procedures to do so. NSB must Response to this Notice This Notice is provided pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.206. 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). Following the receipt of this Notice, you have 30 days to submit written comments, revised procedures, or a request for a hearing under §190.211. 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 an Order Directing Amendment. If 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. § 190.206). If you are not contesting this Notice, we propose that you submit your amended procedures to my office within 90 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 NSB maintain documentation of the safety improvement costs associated with fulfilling this Notice of Amendment (preparation/revision of plans, procedures) and submit the total to Chris Hoidal, Director, Western Region, Pipeline and Hazardous Materials Safety Administration. In correspondence concerning this matter, please refer to CPF 5-2016- 0019M and, for each document you submit, please provide a copy in electronic format whenever possible. Sincerely, Chris Hoidal Director, Western Region Pipeline and Hazardous Materials Safety Administration cc: PHP-60 Compliance Registry PHP-500 J. Gano (#153508) PHP-500 D. Hassell (#153508) Enclosure: Response Options for Pipeline Operators in Compliance Proceedings#