CHEVRON PIPE LINE CO — Warning Letter

520170024W_Warning Letter_11082017_text.pdf, page 1Official PDFWARNING LETTER CERTIFIED MAIL – RETURN RECEIPT REQUESTED November 8, 2017 Mr. Frank Cassulo President Chevron Pipeline Company 1400 Smith Street Houston, TX 77002 CPF 5-2017-0024W Dear Mr. Cassulo: On March 20 through 24, and May 8 through 12, 2017, a representative of the Pipeline and Hazardous Materials Safety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code (U.S.C.), inspected your Coalinga/McKittrick Gas Lines in Houston, Texas, and Bakersfield, California. As a result of the inspection, it is alleged that you have committed probable violations of the Pipeline Safety Regulations, Title 49, Code of Federal Regulations (CFR). The items inspected and the probable violations are: 1. §192.615 Emergency Plans. (c) Each operator shall establish and maintain liaison with appropriate fire, police, and other public officials to: (1) Learn the responsibility and resources of each government organization that may respond to a gas pipeline emergency.#

520170024W_Warning Letter_11082017_text.pdf, page 2A review of the operator’s records for calendar years 2014 through 2016 indicated liaison records only for the operator’s liquid assets. No records were available for the natural gas pipelines. The operator was not able to demonstrate through records that they have established and maintained liaisons with public officials, fire, or police, in accordance with §192.615(c)(1). 2. §192.605 Procedural manual for operations, maintenance, and emergencies. (a) General. Each operator shall prepare and follow for each pipeline, a manual of written procedures for conducting operations and maintenance activities and for emergency response. For transmission lines, the manual must also include procedures for handling abnormal operations. This manual must be reviewed and updated by the operator at intervals not exceeding 15 months, but at least once each calendar year. This manual must be prepared before operations of a pipeline system commence. Appropriate parts of the manual must be kept at locations where operations and maintenance activities are conducted. While reviewing the operator’s atmospheric corrosion records, it was determined that the operator is not following their written procedure for atmospheric corrosion inspections. The operator’s written procedure (MIP 506) requires that the soil-to-air interface be carefully inspected above and below ground eighteen (18) inches. While interviewing the field staff who performed these inspections, the field staff did not appear to be aware of the procedural requirements. 3. §192.481 Atmospheric corrosion control: Monitoring. (b) During inspections the operator must give particular attention to pipe at soil- to-air interfaces, under thermal insulation, under disbonded coatings, at pipe supports, in splash zones, at deck penetrations, and in spans over water. The operator’s documentation for atmospheric corrosion inspections failed to demonstrate they are paying particular attention to the soil-to-air interfaces, in accordance with §192.481(b). 4. §192.465 External corrosion control: Monitoring. (a) Each operator that is under cathodic protection must be tested at least once each calendar year, but with intervals not exceeding 15 months, to determine whether the cathodic protection meets the requirements of §192.463. However, if tests at those intervals are impractical for separately protected short sections of mains or transmission lines, not in excess of 100 feet (30 meters), or separately protected service lines, these pipelines may be surveyed on a sampling basis. At least 10 percent of these protected structures, distributed over the entire system must be surveyed each calendar year, with a different 10 percent checked each subsequent year, so that the entire system is tested in each 10-year period. 2#

520170024W_Warning Letter_11082017_text.pdf, page 3The operator was not able to provide records to demonstrate that cathodic protection monitoring tests have occurred on the CAL 0601A pipeline. The operator stated that the pipeline was abandoned and DOT compliance was no longer required. However, the operator could not provide documentation to demonstrate abandonment of this pipeline. Therefore, cathodic protection monitoring is required, in accordance with §192.465(a). 5. §192.465 External corrosion control: Monitoring. (c) Each reverse current switch, each diode, and each interference bond whose failure would jeopardize structure protection must be electrically checked for proper performance six times each calendar year, but with intervals not exceeding 2 ½ months. Each other interference bond must be checked at least once each calendar year, but with intervals not exceeding 15 months. The operator’s records failed to demonstrate electrical checks in October and December, 2014. The operator failed to perform electrical checks on the critical bond at MP00 (BComp – Drain to Station – Route Code CAL 0608), in accordance with §192.465(c). 6. §192.463 External corrosion control: Cathodic protection. (a) Each cathodic protection system required by this subpart must provide a level of cathodic protection that complies with one or more of the applicable criteria contained in appendix D of this part. If none of these criteria is applicable, the cathodic protection system must provide a level of cathodic protection at least equal to that provided by compliance with one or more of these criteria. The operator is utilizing the Appendix D(I)(A)(1) criteria of a negative (cathodic) voltage of at least 0.85 volts (-850 mV) but fails to fully consider voltage (IR) drop, as required under section II of Appendix D for a valid interpretation of the voltage measurement. Under 49 U.S.C. § 60122 and 49 CFR § 190.223, you are subject to a civil penalty not to exceed $209,002 per violation per day the violation persists up to a maximum of $2,090,022 for a related series of violations. We have reviewed the circumstances and supporting documents involved in this case, and have decided not to conduct additional enforcement action or penalty assessment proceedings at this time. We advise you to correct the item(s) identified in this letter. Failure to do so will result in Chevron Pipeline Company being subject to additional enforcement action. No reply to this letter is required. If you choose to reply, in your correspondence please refer to CPF 5-2017-0024W. 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 3#

520170024W_Warning Letter_11082017_text.pdf, page 4why you believe the redacted information qualifies for confidential treatment under 5 U.S.C. 552(b). Sincerely, Kim West Acting Director, Western Region Pipeline and Hazardous Materials Safety Administration cc: PHP-60 Compliance Registry PHP-500 D. Fehling (#155203) 4#