# HILCORP ALASKA, LLC — Safety Order

- **operation:** document
- **citation:** CPF 520170004S
- **title:** HILCORP ALASKA, LLC — Safety Order
- **source type:** enforcement
- **agency:** Pipeline and Hazardous Materials Safety Administration
- **status:** historical
- **official:** true
- **published on:** 2017-03-03
- **effective on:** Not available
- **summary:** CLOSED safety order.
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- **markdown:** https://regulus.evalyn.ai/document/phmsa-enforcement-520170004s.md
- **app url:** https://regulus.evalyn.ai/document/phmsa-enforcement-520170004s
- **source url:** https://primis.phmsa.dot.gov/enforcement-data/case/520170004S
**body:**

Safety Order involving HILCORP ALASKA, LLC. The dataset does not identify a cited regulation for this case. The case was opened on 2017-03-03 and is reported as closed as of 2020-11-23. Open the official case record for notices, responses, orders, and the latest status.

Official case documents:

520170004S_Closure Letter_11232020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520170004S/520170004S_Closure%20Letter_11232020.pdf

520170004S_Closure Letter_11232020_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520170004S/520170004S_Closure%20Letter_11232020_text.pdf

520170004S_Consent Order and Agreement_04122017.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520170004S/520170004S_Consent%20Order%20and%20Agreement_04122017.pdf

520170004S_Consent Order and Agreement_04122017_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520170004S/520170004S_Consent%20Order%20and%20Agreement_04122017_text.pdf

520170004S_Notice of Proposed Safety Order_03032017.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520170004S/520170004S_Notice%20of%20Proposed%20Safety%20Order_03032017.pdf

520170004S_Notice of Proposed Safety Order_03032017_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520170004S/520170004S_Notice%20of%20Proposed%20Safety%20Order_03032017_text.pdf

520170004S_Consent Order and Agreement_04122017_text.pdf

April 12, 2017
VIA CERTIFIED MAIL AND FAX TO: (907) 777-8301
Mr. Greg Lalicker
President
Hilcorp Alaska, LLC
1111 Travis Street
Houston, Texas 77002
CPF No. 5-2017-0004S
Dear Mr. Lalicker:
Enclosed please find an Order incorporating the terms of the Consent Agreement between the
Pipeline and Hazardous Materials Safety Administration (PHMSA) and Hilcorp Alaska, LLC
(Hilcorp) which was executed on April 11, 2017. Service of the Order and Consent Agreement by
certified mail is deemed effective upon the date of mailing, or as otherwise provided under 49
C.F.R. § 190.5.
Thank you for your cooperation in this matter.
Sincerely,
for Alan K. Mayberry
Associate Administrator
for Pipeline Safety
Enclosure: Order and Consent Agreement
cc: Ms. Linda Daugherty, Deputy Associate Administrator for Field Operations, OPS
Mr. Chris Hoidal, Senior Technical Advisor, Program Development, OPS
Mr. Dustin Hubbard, Acting Region Director, Western Region, OPS
Ms. Erin McKay, Regulatory Compliance Manager, Alaska Integrity Group, Hilcorp
Alaska, LLC, at emckay@hilcorp.com



U.S. DEPARTMENT OF TRANSPORTATION
PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION
OFFICE OF PIPELINE SAFETY
WASHINGTON, D.C. 20590
In the Matter of )
)
)
Hilcorp Alaska, LLC, )
a subsidiary of Hilcorp Energy Company, Respondent. )
)
)
) CPF No. 5-2017-0004S
ORDER
By letter dated March 3, 2017, the Pipeline and Hazardous Materials Safety Administration
(PHMSA), Office of Pipeline Safety (OPS or Agency), issued a Notice of Proposed Safety Order
(Notice) to Hilcorp Alaska, LLC (Hilcorp or Respondent), a subsidiary of Hilcorp Energy
Company.
In accordance with 49 C.F.R. § 190.239, the Notice alleged that conditions exist on
Respondent’s Middle Ground Shoal (MGS) Fuel Gas System that pose a pipeline integrity risk to
public safety, property, or the environment. The Notice also proposed that Respondent take
certain corrective measures to remedy the alleged conditions and ensure that the public, property,
and the environment are protected from the potential risk.
In response to the Notice, Respondent requested an informal consultation, whereupon the parties
engaged in good-faith settlement discussions that have resulted in the Consent Agreement
attached to this Order, of even date herewith, and that settles all of the allegations in the Notice.
Accordingly, the Consent Agreement is hereby approved and incorporated by reference into this
Order. The Respondent is hereby ordered to comply with the terms of the Consent Agreement,
effective immediately.
Pursuant to 49 U.S.C. 60101, et seq., failure to comply with this Consent Order may result in the
assessment of civil penalties of up to $205,638 per day.
The terms and conditions of this Consent Order are effective upon service in accordance with 49
C.F.R. § 190.5.
April 12, 2017
for Alan K. Mayberry Date
Associate Administrator
for Pipeline Safety



U.S. DEPARTMENT OF TRANSPORTATION
PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION
OFFICE OF PIPELINE SAFETY
WASHINGTON, D.C. 20590
In the Matter of )
)
)
Hilcorp Alaska, LLC, )
a subsidiary of Hilcorp Energy Company, Respondent. )
)
)
) CPF No. 5-2017-0004S
CONSENT AGREEMENT
On March 3, 2017, the Regional Director for the Western Region (the Region) of the Pipeline
and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS or the
Agency), issued a Notice of Proposed Safety Order (Notice) to Hilcorp Alaska, LLC (Hilcorp or
Respondent), a subsidiary of Hilcorp Energy Company. The Notice alleged that conditions exist
on Respondent’s Middle Ground Shoal (MGS) Fuel Gas System that pose a pipeline integrity
risk to public safety, property, or the environment. The Notice also proposed that Respondent
take certain corrective measures to remedy the alleged conditions and ensure that the public,
property, and the environment are protected from the potential risk.
Hilcorp responded to the Notice by timely submitting a written response and a request for an
informal consultation. An informal consultation was held on March 22, 2017.
As a result of the informal consultation process, PHMSA and Hilcorp (collectively, Parties)
reached agreement that settlement of this proceeding will avoid further administrative
proceedings or litigation of the Notice and that entry into this Consent Agreement (Agreement) is
the most appropriate means of resolving the issues raised in the Notice and is generally in the
public interest. Therefore, pursuant to 49 C.F.R. Part 190, without adjudication of any issue of
fact or law, and upon consent and agreement of Hilcorp and PHMSA, the Parties agree as
follows:
I. General Provisions
1. Respondent acknowledges that as the operator of the MGS Fuel Gas System,
Respondent and its MGS Fuel Gas System are subject to the jurisdiction of the Federal pipeline
safety laws, 49 U.S.C. § 60101, et seq., and the regulations and administrative orders issued
thereunder. While this Agreement refers to other Hilcorp facilities, this acknowledgement is
limited solely to the MGS Fuel Gas System. For purposes of this Agreement, Respondent
acknowledges that it received proper notice of PHMSA's action in this proceeding and that the
Notice states claims upon which relief may be granted pursuant to 49 U.S.C. 60101, et seq., and



CPF No. 5-2017-0004S
Page 2
the regulations and orders issued thereunder. The MGS Fuel Gas System MGS consists of four
sections of pipe and is defined more specifically as the Affected Pipeline Facility in Paragraph
12(a) of this Agreement.
2. Respondent agrees, for purposes of this Agreement, to address the integrity risks
identified in the Notice by completing the actions specified in Section II of this agreement
(Corrective Measures) and to abide by the terms of this Agreement. This Agreement does not
constitute a finding of violation of any Federal law or regulation and may not be used in any civil
or administrative proceeding of any kind as evidence or proof of any fact, fault or liability, or as
evidence of the violation of any law, rule, regulation or requirement, except in a proceeding to
enforce the provisions of this Agreement.
3. After Respondent returns this signed Agreement to PHMSA, the Agency’s
representative will present it to the Associate Administrator for Pipeline Safety, recommending
that the Associate Administrator adopt the terms of this Agreement by issuing an administrative
order (Consent Order) incorporating the terms of this Agreement. The terms of this Agreement
constitute an offer of settlement until accepted by the Associate Administrator. Once accepted,
the Associate Administrator will issue a Consent Order incorporating the terms of this Agreement.
4. Respondent consents to the issuance of the Consent Order, and hereby waives any
further procedural requirements with respect to its issuance. Respondent waives all rights to
contest the adequacy of notice, or the validity of the Consent Order or this Agreement, including
all rights to administrative or judicial hearings or appeals, except as set forth herein.
5. This Agreement shall apply to and be binding upon PHMSA, and upon Hilcorp,
its officers, directors, and employees, and its successors, assigns, or other entities or persons
otherwise bound by law. Respondent agrees to provide a copy of this Agreement and any
incorporated work plans and schedules to all of Hilcorp’s officers, employees, and agents whose
duties might reasonably include compliance with this Agreement.
6. For all transfers of ownership or operating responsibility of Hilcorp’s MGS Fuel
Gas System, Respondent will provide a copy of this Agreement to the prospective transferee at
least 30 days prior to such transfer and simultaneously provide written notice of the prospective
transfer to the PHMSA Region Director (Director) who issued the Notice.
7. This Agreement constitutes the final, complete and exclusive agreement and
understanding between the Parties with respect to the settlement embodied in this Agreement.
The Parties acknowledge that there are no representations, agreements or understandings relating
to settlement other than those expressly contained in this Agreement, except that the terms of this
Agreement may be construed by reference to the Notice.
8. Nothing in this Agreement affects or relieves Respondent of its responsibility to
comply with all applicable requirements of the Federal pipeline safety laws, 49 U.S.C. § 60101,
et seq., and the regulations and orders issued thereunder. Nothing in this Agreement alters
PHMSA's right of access, entry, inspection, and information gathering or PHMSA's authority to



CPF No. 5-2017-0004S
Page 3
bring enforcement actions against Hilcorp pursuant to the Federal pipeline safety laws, the
regulations and orders issued thereunder, or any other provision of Federal or State law.
9. This Agreement does not waive or modify any Federal, State, or local laws or
regulations that are applicable to Respondent’s pipeline systems. This Agreement is not a
permit, or a modification of any permit, under any Federal, State, or local laws or regulations.
Hilcorp remains responsible for achieving and maintaining compliance with all applicable
Federal, State, and local laws, regulations and permits.
10. This Agreement does not create rights in, or grant any cause of action to, any third
party not party to this Agreement. The U.S. Department of Transportation is not liable for any
injuries or damages to persons or property arising from acts or omissions of Respondent or its
officers, employees, or agents carrying out the work required by this Agreement. Hilcorp agrees
to hold harmless the U.S. Department of Transportation, its officers, employees, agents, and
representatives from any and all causes of action arising from any acts or omissions of
Respondent or its contractors in carrying out any work required by this Agreement.
11. Measures set forth below.
Upon issuance of the Consent Order, Hilcorp agrees to perform the Corrective
12. Definitions:
a. The Affected Pipeline Facility means the 8-inch-diameter "A Pipeline" shown
on the map attached as Exhibit A to the Notice and consists of the following
four sections: 1) MGS onshore facility to "A Platform;" 2) "A Platform" to
“Baker Platform;” 3) "A Platform" to "C Platform;" and 4) "C Platform" to
“Dillon Platform.”
b. The Affected Segment means the section from the MGS onshore facility to the
"A Platform,” on which the leak is physically occurring. The leak is located
approximately 2.6 miles from the "A Platform" and approximately 4.6 miles
from the MGS onshore facility (as measured along the pipeline alignment).
II. Corrective Measures
13. Repairs. The Parties understand that a repair of the leak is a two-phase process,
consisting of an initial, temporary repair followed by a permanent repair. Hilcorp must mobilize
divers and temporarily repair the leak on the failed Affected Segment as soon as Cook Inlet
conditions allow divers to safely access the leak, but no later than by May 1, 2017. If the "A
Pipeline" is not permanently repaired by May 15, 2017, Hilcorp must shut down the "A Pipeline"
and keep it shut down until authorized to resume operation by the Director.
14. Notification of Pressure Fluctuations. Hilcorp must notify the Director by
telephone within one hour of a confirmed discovery of any unplanned pressure fluctuation in
excess of 25% of the target operating pressure, as determined by Hilcorp but not to exceed 165
psi, on the Affected Pipeline Facility. Hilcorp must make any such notifications whenever



CPF No. 5-2017-0004S
Page 4
required, 24 hours a day/7 days a week. In the event the Director is unavailable, Hilcorp must
notify the Alaska Operations Supervisor, PHMSA, by telephone within the time requirement set
forth in this paragraph. In the event that neither the Director nor the Alaska Operations
Supervisor, PHMSA, is available, Hilcorp must leave voicemail messages for both individuals
on their office and mobile telephone numbers.
15. Temporary Pressure Restriction. Prior to making any permanent repair, Hilcorp
must use its best efforts to reduce and maintain the pressure of the Affected Segment as low as
practical to ensure that water does not intrude the oil-contaminated line or otherwise jeopardize
safety or the environment. In no event, however, may Hilcorp increase the pressure above 165
psi without prior written approval from the Director.
16. Leak Inspection and Repair Plan. Hilcorp must develop and implement a
"Pipeline Leak Inspection and Repair Plan" for the Affected Segment. Hilcorp must submit
this plan for approval to the Director prior to making any temporary repair(s) and no later
than two weeks from the issuance of a Consent Order.
17. Shutdown Plan. Hilcorp must develop and submit a plan to safely shut down
the Affected Pipeline Facility in the event operations must cease, either as a result of a
PHMSA mandate or of a Hilcorp business decision. Hilcorp must submit to the Director
such plan for approval no later than 14 days from the issuance of a Consent Order. At a
minimum, the plan must address the following:
a. The potential effects on people, environment, wildlife, platforms, and the "B
Pipeline" system of terminating fuel gas delivery;
b. Purging of the "A Pipeline" of natural gas and maintaining pipeline pressure to
prevent water intrusion with a product that is non-hazardous to life, environment,
and wildlife;
c. The maintenance of minimum flow in the "B Pipeline" to prevent damage to the
pipeline; such as, freezing of water within the pipeline, or in the alternative,
providing for the purging of the "B Pipeline."
18. Environmental Sampling and Monitoring Obligations. If Hilcorp's
environmental sampling and monitoring obligations ordered by the Alaska Department of
Environmental Conservation (ADEC) cannot be met, or if Hilcorp or ADEC learn of significant
changes in the results of environmental sampling and monitoring efforts that suggest harm to the
environment or wildlife, Hilcorp must notify the Director in writing within 12 hours of
confirmed discovery of such qualifying changes. Hilcorp must also inform PHMSA, in writing,
of all requirements and requests made by ADEC to Hilcorp in connection with the Affected
Pipeline Facility within 24 hours of any such requirement or request.
19. Modification and Inspection Plan. Hilcorp must develop and implement a
"Modification and Inspection Plan" for the Affected Pipeline Facility. Hilcorp must submit



CPF No. 5-2017-0004S
Page 5
the plan to the Director for approval no later than 45 days from the issuance of a Consent
Order. At a minimum, the plan must include the following:
a. b. c. d. ILI Assessment: Hilcorp must modify the Affected Pipeline Facility to
accommodate the use of ILI methods ("smart pigs") or alternative technologies
approved by the Director. The selected ILI method or alternative technology must
be capable of detecting, locating, identifying, and sizing dents, gouges, metal loss,
excessive bending and other reasonably-identifiable anomalies.
Hilcorp must conduct an ILI or alternative technology referenced above on the
Affected Segment and make all necessary repairs by September 30, 2018. Hilcorp
must conduct an ILI or alternative technology referenced above on the balance of
the Affected Pipeline Facility not included above and make all necessary repairs
by September 30, 2019.
The ILI results (draft and final reports), and documentation of all subsequent
associated repairs, must be sent to the Director within 30 days of receipt of each
ILI vendor's report by Hilcorp and 30 days following completion of each repair.
Sonar Inspection: Hilcorp must conduct high-resolution sonar inspection, or
equivalent technology, with the prior written approval of the Director, of the
Affected Pipeline Facility to identify pipeline sections that are not adequately
supported physically and thus susceptible to excessive bending or current-induced
vibrations that may damage the relevant pipeline section, no later than 90 days
after the ice freeze has subsided in the spring of 2017 and the Affected Pipeline
Facility becomes accessible by divers. The results of such inspections must be
sent to the Director no later than 30 days after inspection is complete.
Diver Inspections for Vibration and Excessive Bending Threats: For areas where
the Affected Pipeline Facility is not continuously supported by the seabed (i.e., an
unsupported span greater than 20 feet with a gap between the pipeline and the
seafloor of greater than one pipeline diameter), Hilcorp must inspect those areas
by diver, or equivalent, and determine those areas that require mitigation to
address the threats of excessive bending and vibration induced failure. During the
inspections divers will collect basic information about the pipe, including the
existence of weight coat in the areas inspected. The external inspections required
by this paragraph must be performed no later than October 31, 2017. To further
assess for excessive bending on the Affected Pipeline Facility, Hilcorp will
conduct the ILI assessments described in sub-paragraph 19(a), above.
Diver and ILI Inspections for Mechanical Damage: To address the threat of
external damage, Hilcorp must inspect any areas where the pipeline crosses rocky
outcroppings. Hilcorp shall have divers inspect all unsupported spans where the
pipe is resting on rocky outcroppings and determine those areas that require
mitigation to address the threat of external damage. The diver inspections
required by this paragraph must be performed no later than October 31, 2017, on



e. CPF No. 5-2017-0004S
Page 6
the Affected Segment, and no later than October 31, 2018, on the remainder of the
Affected Pipeline Facility. To further assess for mechanical damage in those
locations, and on the remainder of the Affected Pipeline Facility, Hilcorp will
conduct the ILI assessments described in sub-paragraph 19(a), above. If Hilcorp
can collect and integrate ILI and sonar data in advance of the diver inspection
deadlines in this paragraph, it may request that diver inspections be limited to
areas where integrated data demonstrates that a mechanical damage threat exists.
The intervention criteria Hilcorp will use to determine if pipeline repairs or other
mitigation requirements are needed.
20. Documentation. Hilcorp must provide the Director with documentation of
compliance and supporting data, to all Items above.
21. Revisions of Plans. Hilcorp must revise all plans identified in Items 16, 17,
and 19 above, as necessary to incorporate new information obtained during the evaluations
and associated remedial activities. Hilcorp must submit any such plan revisions to the
Director for prior approval. The Director may approve plan elements incrementally. The
plans identified in Items 16, 17, and 19 above, once approved by the Director, will be
incorporated by reference into any Consent Order issued by PHMSA.
22. Written Approvals Required. Hilcorp may only implement the plans
identified in Items 16, 17, and 19 above after they have been approved, in writing, by the
Director, including any revisions to the plan(s).
23. Quarterly Reports. Hilcorp must submit quarterly reports to the Director that:
(1) include analysis of all available data and results of the testing and evaluations required by
this Agreement; and (2) describe the progress of the repairs and other remedial actions being
undertaken. The first report will be due 45 days from issuance of a final Consent Order.
24. Extensions of Time. The Director may grant an extension of time for
compliance with any of the terms of the Agreement upon a written request timely submitted
demonstrating good cause for an extension.
25. Appeals. Respondent may appeal any decision of the Director to the Associate
Administrator for Pipeline Safety. Decisions of the Associate Administrator will be final.
III. Review and Approval Process
26. With respect to any submission under Section II (Corrective Measures) of this
Agreement that requires the approval of the Director, the Director may: (a) approve, in whole or
in part, the submission, (b) approve the submission on specified, reasonable conditions, (c)
disapprove, in whole or in part, the submission, or (d) any combination of the foregoing. If the
Director approves, approves in part, or approves with conditions, Hilcorp will take all action as
approved by the Director, subject to Respondent's right to invoke the dispute resolution
procedures in Section IV with respect to any conditions the Director identifies. If the Director
disapproves all or any portion of the submission, the Director will provide Hilcorp with a written



CPF No. 5-2017-0004S
Page 7
notice of the deficiencies. Respondent will correct all deficiencies within the time specified by
the Director and resubmit it for approval.
IV. Dispute Resolution
27. The Director and Hilcorp will informally attempt to resolve any disputes arising
under this Agreement. If Respondent and the Director are unable to informally resolve the
dispute within 15 days of submittal of Respondent’s invoking dispute resolution, Hilcorp may
request in writing, within 10 days thereafter, a written determination resolving the dispute from
the Associate Administrator for Pipeline Safety providing all information that Respondent
believes is relevant to the dispute. If the request is submitted as provided herein, the Associate
Administrator will issue a final determination in writing. The existence of a dispute and the
PHMSA's consideration of matters placed in dispute will not excuse, toll, or suspend any term or
timeframe for completion of any work to be performed under this Agreement during the
pendency of the dispute resolution process except as agreed by the Director or the Associate
Administrator in writing.
V. Enforcement
28. This Agreement, as adopted by the Consent Order, is subject to all enforcement
authorities available to the PHMSA under 49 U.S.C. § 60101, et seq., and 49 C.F.R. Part 190. work plans and associated schedules set forth or referenced in Section II will be automatically
incorporated into this Agreement and are enforceable in the same manner.
All
VI. Recordkeeping and Information Disclosure
29. Unless otherwise required in this Agreement, Hilcorp agrees to maintain records
demonstrating compliance with all requirements of this Agreement for a period of at least five
years following completion of all work to be performed. For any reports, plans, or other
deliverables required to be submitted to PHMSA pursuant to this Agreement, Respondent may
assert a claim of business confidentiality or other protections applicable to the release of
information by PHMSA, covering part or all of the information required to be submitted to
PHMSA pursuant to this Agreement in accordance with 49 C.F.R. Part 7. Respondent must
mark the claim of confidentiality in writing on each page, and include a statement specifying the
grounds for each claim of confidentially. PHMSA determines release of any information
submitted pursuant to this Agreement in accordance with 49 C.F.R. Part 7, the Freedom of
Information Act, 5 U.S.C. § 552, DOT and PHMSA policies, and other applicable regulations
and Executive Orders.
VII. Effective Date
30. The term “Effective Date,” as used herein, is the date on which the Order is issued
by the Associate Administrator incorporating the terms of this Agreement. Unless specified to
the contrary, all deadlines for actions required by this Agreement run from the Effective Date of
this Order.



CPF No. 5-2017-0004S
Page 8
VIII. Modification
31. The terms of this Agreement may be modified by mutual agreement of the Parties.
Such modifications must be in writing and signed by both parties.
IX. Termination
32. This Agreement terminates upon completion of all terms set forth in Section II
(Corrective Measures) as determined by the Director. Hilcorp may request written confirmation
from PHMSA when this Agreement is terminated and the Director will provide such
confirmation. Nothing in this Agreement prevents Respondent from completing any of the
obligations earlier than the deadlines provided for in this Agreement.
X. Ratification
33. The Parties’ undersigned representatives certify that they are fully authorized to
enter into the terms and conditions of this Agreement and to execute and legally bind such party
to this document.
34. The Parties hereby agree to all conditions and terms of this Agreement.
For Hilcorp Alaska, LLC (Respondent):
___________________________________
________________________
Date
For PHMSA:
___________________________________
Dustin Hubbard
Acting Director, Office of Pipeline Safety
PHMSA Western Region
U.S. Department of Transportation
________________________
Date

520170004S_Closure Letter_11232020_text.pdf

VIA E-MAIL TO MR. GREG LALICKER
November 23, 2020
Mr. Greg Lalicker
Chief Executive Officer
Hilcorp Energy Company
1111 Travis Street
Houston, Texas 77002
RE: Consent Agreement CPF No. 5-2017-0004S
Middle Ground Shoal Fuel Gas System
Request for Termination of Consent Agreement – Item 32
Dear Mr. Lalicker:
On March 3, 2017, the Pipeline and Hazardous Materials Safety Administration (PHMSA)
issued a Notice of Proposed Safety Order to Hilcorp Alaska, LLC (Hilcorp)1 for alleged
conditions existing on Hilcorp’s Middle Ground Shoal (MGS) Fuel Gas System and proposed
that Hilcorp take certain corrective measures. On March 15, 2017, Hilcorp requested an
informal consultation. An informal consultation was held on March 22, 2017. As a result of the
informal consultation process, PHMSA and Hilcorp entered into a Consent Agreement on April
11, 2017. On April 12, 2017, PHMSA issued an Order approving and incorporating the terms of
the Consent Agreement.
By letter dated September 14, 2020, Hilcorp stated that the final outstanding items required by
the Consent Agreement had been completed and requested closure of the Consent Agreement.
Hilcorp indicated that the final outstanding items were the abandonment of the Baker “B” and
Dillon “A” pipelines pursuant to 49 CFR 192.727. By letter dated October 29, 2020, PHSMA
requested supporting data documenting abandonment of the above referenced pipelines, which
Hilcorp provided by letter dated November 5, 2020.
With respect to Hilcorp’s request for closure of the Consent Agreement, PHMSA agrees that the
last remaining corrective measures of the Consent Agreement were the abandonment of the
Baker “B” and Dillon “A” pipelines. Given their abandonment, I have determined that the terms
of the Consent Agreement have been completed. Accordingly, the Consent Agreement is
terminated. Thank you for your cooperation in this matter.
Sincerely,
1 Hilcorp Alaska, LLC, which is a wholly-owned subsidiary of Hilcorp Energy Company.



Dustin Hubbard
Director, Western Region
Pipeline and Hazardous Materials Safety Administration
cc: PHP-60 Compliance Registry
PHP-500 T. Johnson (#155644)
Mr. David S. Wilkins, Senior Vice President, Hilcorp Alaska (via email)
Mr. Ben Wasson, Hilcorp Alaska (via email)

520170004S_Notice of Proposed Safety Order_03032017_text.pdf

VIA FACSIMILE TO (907) 777-8301 AND CERTIFIED MAIL
March 3, 2017
Mr. Greg Lalicker
President
Hilcorp Alaska, LLC
1201 Louisiana Street
Suite 1400
Houston, Texas 77002
CPF 5-2017-0004S
Dear Mr. Lalicker:
Enclosed is a Notice of Proposed Safety Order (Notice) issued in the above-referenced case.
The Notice proposes that you take certain measures with respect to Hilcorp Alaska, LLC’s1
Middle Ground Shoal (MGS) Fuel Gas System located in Cook Inlet, Alaska, to ensure pipeline
safety. Your options for responding are set forth in the Notice. Your receipt of the Notice
constitutes service of that document under 49 C.F.R. § 190.5.
We look forward to a successful resolution of this integrity issue to ensure pipeline safety.
Please direct any questions on this matter to me at 720-963-3160.
Sincerely,
Chris Hoidal
Director, Western Region
Pipeline and Hazardous Materials Safety Administration
Enclosure: Notice of Proposed Safety Order & Attachment A (General Overview Map)
1 Hilcorp Alaska, LLC, operates as a subsidiary of Hilcorp Energy Company.



cc: Mr. Alan K. Mayberry, Associate Administrator for Pipeline Safety, OPS
Ms. Linda Daugherty, Deputy Associate Administrator for Field Operations, OPS
Ms. Erin McKay, Regulatory Compliance Manager, Alaska Integrity Group, Hilcorp Alaska,
LLC, emckay@hilcorp.com



U.S. DEPARTMENT OF TRANSPORTATION
PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION
OFFICE OF PIPELINE SAFETY
WESTERN REGION
LAKEWOOD, COLORADO 80228
________________________________________________
In the Matter of )
)
)
Hilcorp Alaska, LLC, )
a subsidiary of Hilcorp Energy Company, )
Respondent. )
_______________________________________________ )
) CPF No. 5-2017-0004S
NOTICE OF PROPOSED SAFETY ORDER
Background and Purpose
Pursuant to Chapter 601 of Title 49, United States Code, the Pipeline and Hazardous Materials
Safety Administration (PHMSA), U.S. Department of Transportation, has initiated an
investigation and information review of the safety of your Middle Ground Shoal (MGS) Fuel
Gas System, consisting of approximately 15 miles of in-service gas pipeline mileage located in
the Cook Inlet, Alaska. This investigation stems from a gas leak that was first discovered by
Hilcorp Alaska, LLC (Hilcorp) on February 7, 2017, and that is ongoing in the waters of Cook
Inlet.
The MGS Fuel Gas System provides non-odorized gas (including oil production lift gas) to
Hilcorp’s offshore “A Platform,” “Baker Platform,” “C Platform,” and “Dillon Platform,” all
utilizing gas from the East Cook Inlet Gas Gathering System (ECIGGS). ECIGGS is a PHMSA-
regulated natural gas transmission pipeline system. PHMSA Letter of Interpretation (PI-10-
0024) to XTO Energy, Inc., prior owner of the line, dated July 12, 2011, established that the
pipeline associated with the MGS Fuel Gas System is a transmission line under PHMSA
jurisdiction, as defined by 49 C.F.R. § 192.3.2 The MGS pipeline system begins at the three-inch
tie-in to the ECIGGS pipeline on Wik Road in Nikiski, Alaska. The pipeline passes through
Station O (201 Meter) and the MGS onshore facility before transitioning to the subsea portion
2 See 49 C.F.R. §192.3 (defining transmission lines as “a pipeline, other than a gathering line, that: (1) transports gas
from a gathering line or storage facility to a distribution center, storage facility, or large volume customer that is not
down-stream from a distribution center; (2) operates at a hoop stress of 20 percent or more of SMYS; or (3) transports
gas within a storage field. NOTE: A large volume customer may receive similar volumes of gas as a distribution
center, and includes factories, power plants, and institutional users of gas.”



2
that extends to the platforms in Cook Inlet. The MGS pipeline system, as shown on Attachment
A, includes 2-inch, 4-inch, 6-inch and 8-inch diameter pipe.3
As a result of the investigation and information review, it appears that conditions exist on your
pipeline facilities that pose a pipeline integrity risk to public safety, property or the environment.
Pursuant to 49 U.S.C. § 60117(l), PHMSA issues this Notice of Proposed Safety Order (Notice),
notifying you of the preliminary findings of the investigation, and proposing that you take certain
measures to ensure that the public, property, and the environment are protected from this
integrity risk.
For purposes of this Notice, the term Affected Pipeline Facility means the 8-inch-diameter “A
Pipeline” and consists of the following four sections: 1) MGS onshore facility to “A Platform”;
2) “A Platform” to Baker Platform; 3) “A Platform” to “C Platform;” and 4) “C Platform” to
Dillon Platform. In addition, the term “Affected Segment” means the “A Pipeline” segment on
which the leak is physically occurring and that runs from the MGS onshore facility to the “A
Platform.”
Preliminary Findings:
 The gas leak on the Affected Segment is located approximately 2.6 miles from the “A
Platform” and approximately 4.6 miles from the MGS onshore facility (as measured
along the pipeline alignment).
 The leak was discovered on February 7, 2017 and is still ongoing, with a current
estimated leak rate of between 210,000 to 310,000 cubic feet per day.
 The accident was initially reported by Hilcorp to the National Response Center at 7:49
pm EST on February 7, 2017 (NRC Report No. 1170504), indicating an unknown
quantity release of natural gas. In addition, Hilcorp’s Regulatory Compliance Manager
left a phone message for a PHMSA Anchorage Office employee on February 7, 2017, at
8:25 pm EST.
 Hilcorp reports that in late January 2017, it noticed an increased trend in pipeline flow
data on the Affected Segment. In response to this data, Hilcorp indicates that it
conducted aerial pipeline surveillances by helicopter, looking specifically for leaks, and
discovered the leak on February 7, 2017. Subsequently, Hilcorp’s flow analysis revealed
that the pipeline began leaking in late December 2016.
 The offshore (subsea) portion of the MGS Fuel Gas System is identified as the “A
Pipeline.” As noted above, the “A Pipeline” begins at the onshore facility and is routed
to the “A Platform.” At the “A Platform,” the pipeline bifurcates, with one leg extending
3 Attachment A, General overview map of the pipeline system.



3
to the “Baker Platform” and the other to the “C Platform” and “Dillon Platform.” The “A
Pipeline” is an 8-inch nominal diameter gas transmission pipeline and was converted
from liquid to gas service in 2005.
 In close proximity to the “A Pipeline” is Hilcorp’s parallel “B Pipeline,” a crude-oil
pipeline not shown on Attachment A. The “B Pipeline” has similar pipeline
characteristics as those of the “A Pipeline” and transports hazardous liquids produced and
initially processed by the offshore platforms to the MGS onshore facilities. The “B
Pipeline” is operating in an environment substantially similar to the “A Pipeline.”
 The “A Platform” and “C Platform” produce crude oil, conduct initial processing, and are
manned 24 hours a day, seven days a week. The “Baker Platform” and “Dillon Platform”
are in “light house” mode and are unmanned.4
 The “A Pipeline” is an 8-inch nominal diameter transmission pipeline with 0.594” wall
thickness. The pipeline is Grade B seamless pipe with X-Tru Coat and one-inch concrete
weight coating. The portion of the “A Pipeline” running from the MGS shore facility to
the “A Platform” and the portion running from the “A Platform” to “C” Platform were
installed in 1965.
 Hilcorp Alaska, LLC (OPID: 32645), purchased oil and gas facilities located in Nikiski,
Alaska from XTO Energy, Inc. (OPID: 31178), on September 1, 2015. This purchase
included the “A Pipeline.”
 The product being transported by the “A Pipeline” is transmission-quality natural gas
(98.67% methane). The pipeline operates continuously and has a normal operating
pressure range of 160-250 psig. The pipeline was converted from liquid service to gas
service in 2005.
 Since the leak was discovered by Hilcorp on February 7, 2017, the following actions have
been taken by Hilcorp: (1) the operating pressure on “A Pipeline” was lowered to 165
psi; (2) periodic helicopter overflights were conducted for visual surveillance of the leak
area; (3) periodic situational reports were compiled; (4) the company performed analyses
of different operational options; (5) the operator calculated the estimated gas leak rate;
(6) the company shut down non-essential equipment on the offshore platforms to
minimize gas demand; (7) it performed modeling on methane dispersion in Cook Inlet
waterway; (8) it made preliminary preparations for divers and dive boat to perform
necessary repairs when ice conditions and weather permitted; and (9) the company
participated in meetings with federal and state agencies to coordinate response efforts.
The National Oceanic and Atmospheric Administration (NOAA), National Marine
Fisheries Service (NMFS) has expressed concerns to PHMSA about the potential
4 “Light house” mode means no active production is taking place at these platforms. The primary operating objectives
for light house mode platforms are the continual operation of impressed current cathodic protection systems and
navigational-aid lighting.



4
environmental damage that may result from the continued release of gas in Cook Inlet.
By letter dated February 24, 2017 to PHMSA, NMFS provided an outline of the species
and designated critical habitat that occur in Cook Inlet and documented its concerns
regarding the potential effects of the natural gas discharge on marine mammals, including
the critically-endangered Cook Inlet beluga whales.
 The Alaska Department of Environmental Conservation (ADEC) has also responded to
the ongoing gas release from “Pipeline A” because it considers the leak to be a discharge
of hazardous substance into or upon the waters or lands of the state, which is prohibited
unless authorized by ADEC, under Alaska Statute 46.03.745. By letter dated February
27, 2017, ADEC ordered Hilcorp to conduct environmental sampling and monitoring. To
date, ADEC has issued three Situation Reports regarding the leak. ADEC also has
described the environmentally sensitive areas and wildlife issues in its Incident Report,
which was prepared with input from the National Marine Fisheries Service, the Alaska
Department of Fish and Game, and the US Fish and Wildlife Service.
 Regarding risks associated with water craft, the United States Coast Guard (USCG) has
determined that risk to life and property appear to be low, primarily based on the remote
area of the failure, current limited access due to sea ice, and modeling of the flammable
area of the vapor cloud. As the sea ice dissipates, USCG estimates that the risk to life
and property would likely increase. The USCG has and continues its Very High
Frequency radio broadcast to mariners describing the gas leak, its location, and specific
requests to mitigate the risk. At this time the USCG has not implemented a safety zone
around the leak location; however, if necessary it could. An identified risk condition
related to the leaking pipeline itself is that the leak could get worse and potentially fail if
the leak was caused by outside forces, e.g. vibration, vortex shedding, excessive bending,
or rock impingement.
 Regarding risks associated with commercial aircraft, PHMSA finds that in the event the
failure was caused by outside force as noted above, then the leak could po
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