# PACIFIC OPERATORS OFFSHORE — Notice of Probable Violation

- **operation:** document
- **citation:** CPF 520177004
- **title:** PACIFIC OPERATORS OFFSHORE — Notice of Probable Violation
- **source type:** enforcement
- **agency:** Pipeline and Hazardous Materials Safety Administration
- **status:** historical
- **official:** true
- **published on:** 2017-12-19
- **effective on:** Not available
- **summary:** CLOSED notice of probable violation citing 195.440(a), 195.452(b)(5), 195.583(a), 195.9.
- **machine formats:** - **json:** https://regulus.evalyn.ai/document/phmsa-enforcement-520177004.json
- **markdown:** https://regulus.evalyn.ai/document/phmsa-enforcement-520177004.md
- **app url:** https://regulus.evalyn.ai/document/phmsa-enforcement-520177004
- **source url:** https://primis.phmsa.dot.gov/enforcement-data/case/520177004
**body:**

Notice of Probable Violation involving PACIFIC OPERATORS OFFSHORE. PHMSA's enforcement data identifies the cited regulations as 195.440(a),  195.452(b)(5),  195.583(a),  195.9. The case was opened on 2017-12-19 and is reported as closed as of 2020-02-10. Proposed civil penalty: $15,500. Assessed civil penalty: $15,500. Open the official case record for notices, responses, orders, and the latest status.

Official case documents:

520177004_FAA-Treasury Document_02102020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520177004/520177004_FAA-Treasury%20Document_02102020.pdf

520177004_Final Order_05032019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520177004/520177004_Final%20Order_05032019.pdf

520177004_Final Order_05032019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520177004/520177004_Final%20Order_05032019_text.pdf

520177004_NOPV PCP PCO_12192017.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520177004/520177004_NOPV%20PCP%20PCO_12192017.pdf

520177004_NOPV PCP PCO_12192017_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520177004/520177004_NOPV%20PCP%20PCO_12192017_text.pdf

520177004_Operator Response Request Abeyance of Final Order_05152019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520177004/520177004_Operator%20Response%20Request%20Abeyance%20of%20Final%20Order_05152019.pdf

520177004_Operator Response to Notice_04202018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520177004/520177004_Operator%20Response%20to%20Notice_04202018.pdf

520177004_Response to Operator Request for Abeyance_06262019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520177004/520177004_Response%20to%20Operator%20Request%20for%20Abeyance_06262019.pdf

520177004_Response to Operator Request for Abeyance_06262019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520177004/520177004_Response%20to%20Operator%20Request%20for%20Abeyance_06262019_text.pdf

520177004_NOPV PCP PCO_12192017_text.pdf

NOTICE OF PROBABLE VIOLATION
PROPOSED CIVIL PENALTY
and
PROPOSED COMPLIANCE ORDER
CERTIFIED MAIL - RETURN RECEIPT REQUESTED
December 19, 2017
Mr. Bruce E. Johnston
Pacific Operators Offshore LLC
Vice President, Operations Superintendent
1145 Eugenia Pl. Ste. 200
Carpinteria, CA 93013
CPF 5-2017-7004
Dear Mr. Johnston:
On several occasions between February 14, 2017 and April 14, 2017, a representative of the
Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety
(OPS), pursuant to Chapter 601 of 49 United States Code inspected the Pacific Operators
Offshore LLC’s (PACOPS) pipeline system that serves Platform Hogan and the La Conchita
Separation Facility in La Conchita, California.
As a result of the inspection, it is alleged that PACOPS has committed probable violations of
the Pipeline Safety Regulations, Title 49, Code of Federal Regulations. The items inspected
and the probable violations are:



1. §195.9 Outer continental shelf pipelines.
Operators of transportation pipelines on the Outer Continental Shelf must
identify on all their respective pipelines the specific points at which operating
responsibility transfers to a producing operator. For those instances in which the
transfer points are not identifiable by a durable marking, each operator will have
until September 15, 1998 to identify the transfer points. If it is not practicable to
durably mark a transfer point and the transfer point is located above water, the
operator must depict the transfer point on a schematic maintained near the
transfer point. If a transfer point is located subsea, the operator must identify the
transfer point on a schematic which must be maintained at the nearest upstream
facility and provided to PHMSA upon request. For those cases in which
adjoining operators have not agreed on a transfer point by September 15, 1998
the Regional Director and the MMS Regional Supervisor will make a joint
determination of the transfer point.
PACOPS, an operator of transportation pipelines on the Outer Continental Shelf,1 violated 49
C.F.R. § 195.9 by failing to identify on all its respective pipelines the specific points at which
operating responsibility transfers to a producing operator. At the time of the field inspection,
PHMSA observed no visible marking on the pipe of Platform Hogan identifying the transfer
point.2 In addition, PACOPS could not provide any schematics maintained near the transfer
point to depict the transfer point.3
2. §195.440 Public awareness.
(a) Each pipeline operator must develop and implement a written continuing
public education program that follows the guidance provided in the American
Petroleum Institute's (API) Recommended Practice (RP) 1162 (incorporated by
reference, see §195.3).
PACOPS violated 49 C.F.R. § 195.440(a) by failing to implement its written continuing
public education program that follows the guidance provided in API 1162. Section 7 of API
1162 discusses program documentation and recordkeeping, recommending that each operator
establish policies and procedures necessary to properly document its Public Awareness
Program and retain those key records for purposes of program evaluation.4 PACOPS has
1 See 49 C.F.R. § 195.2 (defining Outer Continental Shelf as “all submerged lands lying seaward and outside the
area of lands beneath navigable waters as defined in Section 2 of the Submerged Lands Act (43 U.S.C. 1301) and
of which the subsoil and seabed appertain to the United States and are subject to its jurisdiction and control”).
2 See Exhibit A to Violation Report (depicting a photograph of the offshore pipe at Platform Hogan with no
marking to identify specific points at which operating responsibility transferred to the producing operator).
3 See Violation Report at page 7 (noting that at the time of the inspection, PACOPS staff could not identify any
schematics to indicate transfer points).
4 API 1162 at 26.
2



incorporated much of Section 7 into its own program. Specifically, PACOPS’s Public
Awareness Plan, Section 12 - Documentation states, in pertinent part:
The Company shall collect and retain documentation of the public
awareness program. These records demonstrate that the Company's
program is in conformance with these procedures…5
PACOPS’s Public Awareness Plan, Section 12.2 – Other Documentation Records, lists
examples of documentation records, including: “communication materials provided to each
stakeholder audience (e.g. brochures, mailings, letters, etc.); lists, records, or other
documentation of stakeholder audiences with whom the Company has communicated (e.g.
contact mailing rosters); implementation dates; postage receipts; response cards; audience
contact documentation (e.g. sign-in sheets, invitation lists, etc.); program evaluations,
including current results, follow-up actions and expected results; [and] program
enhancement(s).”6
Finally, PACOPS’s Public Awareness Plan, Section 12.3 – Record Retention requires
retention of records for “a minimum of five (5) years, or as defined in the Company's public
awareness program section #12.5, whichever is longer. Record retention shall include: lists,
records, or other documentation of stakeholder audiences with whom the Company has
communicated; copies of all materials provided to each stakeholder audience; [and] all
program evaluations, including current results and follow-up actions.”7
At the time of the inspection, PACOPS could not provide records to demonstrate compliance
with its public awareness program.8 By failing to collect and retain documentation of its
public awareness program pursuant to its own written procedures, as outlined above,
PACOPS failed to implement its written continuing public education program in violation of
49 C.F.R. § 195.440(a).
5 See Exhibit B to Violation Report at 2 (noting that “the written program shall include the following: [a] statement
of management commitment to achieving effective public/community awareness; [a] description of the roles and
responsibilities of personnel administering the program; [i]dentification of key personnel and their titles;
[i]dentification of the media and methods of communication to be used in the program; [d]ocumentation of the
frequency and the basis for selecting that frequency for communicating with each of the targeted audiences; [t]he
process for identifying program enhancements beyond the baseline program, including the basis for implementing
such enhancements; [and] [t]he program evaluation process, including the evaluation objectives, methodology to
be used to perform the evaluation and analysis of the results, and criteria for program improvement based on the
results of the evaluation”).
6 Id.
7 Id. at 2-3.
8 See Violation Report at 15 (noting that PACOPS staff could not find any records at the time of the inspection).
3



3. §195.452 Pipeline integrity management in high consequence areas.
(b) What program and practices must operators use to manage pipeline
integrity? Each operator of a pipeline covered by this section must:
(5) Implement and follow the program.
PACOPS did not implement and follow its Integrity Management Program in violation of 49
C.F.R. § 195.452(b)(5). PACOPS’s Integrity Management Plan (IMP), Section 1.2 -
Identification of HCA Segments and Documentation states, in part:
All reviews to identify HCAs will be fully documented. This means methods
and assumptions will be included where applicable, especially for exceptions.
Justification for exceptions will also include HVL properties, topographical
considerations, type of HCA, and significant of consequences. See section
[1.4]1.3 for a full list of factors to consider in determining if a segment could
affect an HCA.
The Company intends to utilize a Graphic Information System (GIS) as well
as calculations of dispersion modeling distances to identify pipeline segments
that could affect HCAs. Also, local knowledge and experience will be used in
the determination of HCAs. These methods are discussed below. In the IMP
records binder/files is a listing of the HCAs as a result of this review. 9
At the time of the inspection, PACOPS provided a copy of its 2016 Annual Pipeline
Assessment Review, which stated that “[s]ince the onshore portion of the oil pipeline lies
within 220 yards of the mean high tide line, PACOPS elects to conservatively define that
both segments of its pipeline reside within HCA.”10 Although PACOPS concluded that its
onshore pipe resides in an HCA, PACOPS could not provide records to show the methods,
assumptions, or calculations of dispersion modeling distances used in determining that its
pipeline segments could affect HCAs as required by Section 1.2 of its IMP.11
4. §195.583 What must I do to monitor atmospheric corrosion control?
(a) You must inspect each pipeline or portion of pipeline that is exposed to the
atmosphere for evidence of atmospheric corrosion, as follows:
9 Exhibit D to Violation Report at 1.
10 Exhibit E to Violation Report.
11 See also 49 C.F.R. § 195.452(l)(1) (requiring operators to “maintain, for the useful life of the pipeline, records
that demonstrate compliance with the requirements of this subpart” that includes documents to support decisions
and analyses).
4



PACOPS did not inspect each pipeline or portion of pipeline that is exposed to the atmosphere
for evidence of atmospheric corrosion in violation of 49 C.F.R. § 195.583(a). Specifically,
PACOPS’s onshore pipe is required to be inspected at least once every 3 calendar years, but
with intervals not exceeding 39 months. At the time of the inspection, PACOPS provided
inspection records to PHMSA showing that the onshore DOT pipe at La Conchita Facility had
been inspected for atmospheric corrosion in 2008 and 2010.12 However, PACOPS could not
provide records or other substantiating evidence to demonstrate that atmospheric corrosion
inspections were conducted in 2013 and 2016.
Proposed Civil Penalty
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. For violations occurring prior to November 2, 2015, the
maximum penalty may not exceed $200,000 per violation per day, with a maximum penalty
not to exceed $2,000,000 for a related series of violations. The Compliance Officer has
reviewed the circumstances and supporting documentation involved in the above probable
violation(s) and has recommended that you be preliminarily assessed a civil penalty of
$15,500 as follows:
Item number
PENALTY
Item 2
$15,500
Warning Items
With respect to Item 4, 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 promptly correct this item.
Failure to do so may result in additional enforcement action.
Proposed Compliance Order
With respect to Items 1, 2 and 3, pursuant to 49 U.S.C. § 60118, the Pipeline and Hazardous
Materials Safety Administration proposes to issue a Compliance Order to Pacific Operators
Offshore Operator LLC. Please refer to the Proposed Compliance Order, which is enclosed
and made a part of this Notice.
Response to this Notice
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. All material you submit in response to this enforcement action may be 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
12 Exhibit F to Violation Report.
5



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, or request
a hearing under 49 CFR § 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 a Final Order. If you are responding to this
Notice, we propose that you submit your correspondence to my office within 30 days from
receipt of this Notice. This period may be extended by written request for good cause.
In your correspondence on this matter, please refer to CPF 5-2017-7004 and, for each
document you submit, please provide a copy in electronic format whenever possible.
Sincerely,
Huy Nguyen
Acting Director, Western Region
Pipeline and Hazardous Materials Safety Administration
Enclosures: Proposed Compliance Order
Response Options for Pipeline Operators in Compliance Proceedings
cc: PHP-60 Compliance Registry
PHP-500 M. Garcia ((#156051)
6



PROPOSED COMPLIANCE ORDER
Pursuant to 49 United States Code § 60118, the Pipeline and Hazardous Materials Safety
Administration (PHMSA) proposes to issue to the Pacific Operator Offshore LLC (PACOPS)
a Compliance Order incorporating the following remedial requirements to ensure its
compliance with the pipeline safety regulations:
1. 2. 3. 4. In regard to Item 1 of the Notice pertaining to not having a visible marking on
the pipe to indicate transfer point, PACOPS must identify on all its outer
continental shelf pipelines the specific points at which operating responsibility
transfers to a producing operator by durable marking. If it is not practicable to
durably mark a transfer point and the transfer point is located above water, the
operator must depict the transfer point on a schematic maintained near the
transfer point. Pictures or any other documentation to show compliance of 49
C.F.R. § 195.9 must be submitted to PHMSA within 30 days after receipt of
the Final Order.
In regard to Item 2 of the Notice pertaining to not implementing its written
continuing public education program, PACOPS must submit records such as
stakeholder lists, brochures, or pamphlets indicating message, documentation
of sent messages, maps, procedures, plans, evaluation results, follow-up
actions, and other relevant documentation that supports compliance to PHMSA
within 180 days after receipt of the Final Order.
In regard to Item 3 of the Notice pertaining to not having records to show the
methods, assumptions, or calculations of dispersion modeling distances used in
determining pipeline segments that could affect HCAs, PACOPS must submit
these records for the onshore portion of the oil pipeline from Platform Hogan
to La Conchita Onshore Processing Facility to PHMSA within 180 days after
receipt of the Final Order.
It is requested (not mandated) that PACOPS maintain documentation of the
safety improvement costs associated with fulfilling this Compliance Order and
submit the total to Huy Nguyen, Acting Director, Western Region, Pipeline
and Hazardous Materials Safety Administration. It is requested that these costs
be reported in two categories: 1) total cost associated with preparation/revision
of plans, procedures, studies and analyses, and 2) total cost associated with
replacements, additions and other changes to pipeline infrastructure.
7

520177004_Final Order_05032019_text.pdf

May 3, 2019
Mr. Robert Carone
Managing Member
Pacific Operators Offshore, LLC
1145 Eugenia Place, Suite 200
Carpinteria, CA 93013
Re: CPF No. 5-2017-7004
Dear Mr. Carone:
Enclosed please find the Final Order issued in the above-referenced case. It withdraws one of
the allegations of violation, makes other findings of violation, assesses a civil penalty of $15,500,
and specifies actions that need to be taken by Pacific Operators Offshore, LLC, to comply with
the pipeline safety regulations. The penalty payment terms are set forth in the Final Order.
When the civil penalty has been paid and the terms of the compliance order completed, as
determined by the Director, Western Region, this enforcement action will be closed. Service of
the Final 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: Director, Western Region, Office of Pipeline Safety, PHMSA
Mr. Bruce E. Johnston, Vice President, Operations Superintendent, Pacific Operators
Offshore, LLC
Mr. Clement Alberts, Environmental Coordinator, Pacific Operators Offshore, LLC
CERTIFIED MAIL - RETURN RECEIPT REQUESTED



U.S. DEPARTMENT OF TRANSPORTATION
PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION
OFFICE OF PIPELINE SAFETY
WASHINGTON, D.C. 20590
____________________________________
In the Matter of )
Pacific Operators Offshore, LLC, ) CPF No. 5-2017-7004
)
)
)
Respondent. )
____________________________________)
FINAL ORDER
From February 14 through April 14, 2017, pursuant to 49 U.S.C. § 60117, a representative of the
Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety
(OPS), conducted an on-site pipeline safety inspection of the facilities and records of Pacific
Operators Offshore, LLC (PACOPS or Respondent), in La Conchita, California. PACOPS
operates two drilling platforms on the Outer Continental Shelf (OCS), an onshore oil and gas
processing facility in Ventura County, California, and 6.44 miles of pipelines connecting the
platforms with the processing facility.1
As a result of the inspection, the Director, Western Region, OPS (Director), issued to
Respondent, by letter dated December 19, 2017, a Notice of Probable Violation, Proposed Civil
Penalty, and Proposed Compliance Order (Notice), which also included a warning pursuant to 49
C.F.R. § 190.205. In accordance with 49 C.F.R. § 190.207, the Notice proposed finding that
PACOPS had violated 49 C.F.R. §§ 195.9, 195.440(a), and 195.452(b)(5) and proposed
assessing a civil penalty of $15,500 for the alleged violations. The Notice also proposed
ordering Respondent to take certain measures to correct the alleged violations. The warning item
required no further action, but warned the operator to correct the probable violation or face
possible future enforcement action.
After requesting and receiving an extension of time to respond, PACOPS responded to the
Notice by letter dated April 20, 2018 (Response). The company contested the allegations,
offered additional information in response to the Notice, and requested that the proposed civil
penalty be eliminated. Respondent did not request a hearing and therefore has waived its right to
one.
1 Pacific Operators Offshore, LLC, 2018 Annual Report for Calendar Year 2017, Hazardous Liquid Pipeline
Systems, Form PHMSA F 7000-1.1 (on file with PHMSA).



CPF No. 5-2017-7004
Page 2
FINDINGS OF VIOLATION
The Notice alleged that Respondent violated 49 C.F.R. Part 195, as follows:
Item 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.9, which states:
§ 195.9 Outer continental shelf pipelines.
Operators of transportation pipelines on the Outer Continental Shelf
must identify on all their respective pipelines the specific points at which
operating responsibility transfers to a producing operator. For those
instances in which the transfer points are not identifiable by a durable
marking, each operator will have until September 15, 1998 to identify the
transfer points. If it is not practicable to durably mark a transfer point and
the transfer point is located above water, the operator must depict the
transfer point on a schematic maintained near the transfer point. If a transfer
point is located subsea, the operator must identify the transfer point on a
schematic which must be maintained at the nearest upstream facility and
provided to PHMSA upon request. For those cases in which adjoining
operators have not agreed on a transfer point by September 15, 1998 the
Regional Director and the MMS Regional Supervisor will make a joint
determination of the transfer point.
The Notice alleged that Respondent violated 49 C.F.R. § 195.9 by failing to identify the specific
points at which operating responsibility for its transportation pipelines on the OCS transfers to a
producing operator. Specifically, the Notice alleged that PACOPS did not have any visible
marking on the pipe of Platform Hogan that identified the transfer point. Additionally, PACOPS
allegedly did not maintain any schematics near the transfer point that depicted the transfer point.
In its Response, PACOPS did not dispute that it had no visible markings or schematics of the
transfer point, but argued that no reasonable justification exists for a violation since the company
is both the operator of the transportation pipeline and the operator of the producing operator.
Respondent argued that it is not possible to delineate an “arbitrary” transfer point under 49
C.F.R. § 195.9 because “production and transportation are contiguous and under the
responsibility of a single common operating entity.” Additionally, Respondent argued that
responsibility for determining the transfer point falls jointly upon PHMSA and the Department
of the Interior’s Bureau of Safety and Environmental Enforcement (BSEE), one of the successor
agencies of the Minerals Management Service (MMS),2 and not upon the operator. Respondent
provided evidence of a March 2018 email exchange between a PACOPS employee and an
employee of BSEE, in which they discussed where on this facility PHMSA and BSEE
jurisdiction should be transferred and concluded that no designation or transfer point was needed.
Having considered PACOPS’ Response and the arguments presented, I find them unpersuasive.
First, the purpose of the pipeline safety requirement to designate a transfer point under § 195.9 is
2 Bureau of Safety and Environmental Enforcement, website, available at https://www.bsee.gov/who-we-
are/history/reorganization.



CPF No. 5-2017-7004
Page 3
to indicate clearly, to both regulators and operator personnel, the precise point at which a
pipeline must meet the safety regulations in 49 C.F.R. Part 195. This transfer point marks the
point at which safety oversight transfers from BSEE to OPS. The depiction of this transfer point,
either via a durable marking on the pipeline facility or in a schematic maintained near the
transfer point, provides a practical and useful means of designating where OPS’ oversight begins
at the facility and ensuring that transportation pipelines comply with PHMSA regulations.3
While 49 C.F.R. § 195.9 requires an operator to determine the point at which a production line
becomes a transportation line, this determination is not arbitrary. In most cases, the transfer
point will occur at a specific valve or flange where these adjoining operations interconnect.
Second, I find the opinions in the March 2018 email exchange provide no additional support for
Respondent’s argument. Section 195.9 controls when and where an operator must identify its
transportation pipelines. A unilateral statement from a BSEE employee, made two decades after
the transfer-point-designation deadline contained in § 195.9 expired, does not serve to absolve
PACOPS’ responsibility for designating a transfer point on its pipeline.
Third, a finding of violation in this case is consistent with past agency practice. PHMSA has
previously enforced 49 C.F.R. § 195.9 against operators that operate interconnected production
and transportation pipelines as in the instant case.4 Such published enforcement actions provide
the regulated community with fair notice that PHMSA expects operators of interconnected
systems to demarcate a jurisdictional dividing line between the two portions of their systems.
Finally, Respondent’s assertion that responsibility for marking the transfer point falls jointly
upon PHMSA and BSEE is also unpersuasive. The joint agency-determination process noted in
§ 195.9 is applicable only where two adjoining operators cannot agree on a transfer point. In the
instant case, PACOPS cannot avail itself of this provision since there is no disagreement with an
adjoining operator on the location of a transfer point.
Accordingly, after considering all of the evidence, I find that Respondent violated 49 C.F.R.
§ 195.9 by failing to identify the specific points at which operating responsibility for its
transportation pipelines on the OCS transfers to a producing operator.
Item 2: The Notice alleged that Respondent violated 49 C.F.R. § 195.440(a), which states:
§ 195.440 Public awareness.
(a) Each pipeline operator must develop and implement a written
continuing public education program that follows the guidance provided in
the American Petroleum Institute's (API) Recommended Practice (RP)
1162 (incorporated by reference, see §195.3).
3 Pipeline Safety: Regulations Implementing Memorandum of Understanding With the Department of the Interior
62 Fed. Reg. 61692, 61693 (Nov. 19, 1997).
4 E.g., In the Matter of Chevron USA, Inc., CPF No. 4-2011-9001, 2012 WL 3144497 (DOT June 14, 2012),
available at
https://primis.phmsa.dot.gov/comm/reports/enforce/CaseDetail_cpf_420119001.html?nocache=6360#_TP_1_tab_2.



CPF No. 5-2017-7004
Page 4
The Notice alleged that Respondent violated 49 C.F.R. § 195.440(a) by failing to implement its
written continuing education program pursuant to API RP 1162. Specifically, the Notice alleged
that PACOPS failed to comply with Section 7 of API RP 1162 and Section 12 of the company’s
Public Awareness Plan (PAP), which requires PACOPS to “collect and retain documentation of
the public awareness program.” Section 12.2 of the PAP lists examples of the documentation
that must be retained, and Section 12.3 requires retention of said documentation for a minimum
of five years. PACOPS did not provide any records of its PAP or otherwise demonstrate
compliance with API RP 1162 and 49 C.F.R. § 195.440(a).
In its Response, PACOPS did not dispute that it failed to provide PHMSA records demonstrating
compliance with § 195.440(a), but argued that no stakeholder audience exists with respect to the
company’s PAP, noting that the facility in question is surrounded by empty land on three sides
and a freeway and ocean on the fourth. This argument is not persuasive; stakeholder audiences
are not limited to potentially-affected members of the public. Under Section 3 of API RP 1162,
stakeholder audiences include the affected public, emergency officials, local public officials, and
excavators. Although the instant facility may be sited in a remote location, Respondent’s PAP
must, at the very least, inform emergency officials and local public officials whose jurisdictions
encompass the facility of how to identify a potential hazard, to protect themselves, to notify
emergency response personnel, and to notify the pipeline operator in the event of a pipeline
emergency. This requirement is especially important given the facility's close proximity to the
ocean.
Accordingly, after considering all of the evidence, I find that Respondent violated 49 C.F.R.
§ 195.440(a) by failing to implement its written continuing education program pursuant to API
RP 1162.
Item 3: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(b)(5), which states:
§ 195.452 Pipeline integrity management in high consequence areas.
(a) . . . .
(b) What program and practices must operators use to manage pipeline
integrity? Each operator of a pipeline covered by this section must:
(1) Develop a written integrity management program that addresses the
risks on each segment of pipeline . . . .
(5) Implement and follow the program.
The Notice alleged that Respondent violated 49 C.F.R. § 195.452(b)(5) by failing to implement
and follow its own written Integrity Management Program (IMP). Specifically, the Notice
alleged that while PACOPS conservatively considered the onshore portion of its pipeline to be
within a High Consequence Area (HCA), the company did not provide records demonstrating the
methods, assumptions, or calculations used in determining that this facility was within an HCA,
as required by Section 1.2 of PACOPS’ IMP.
In its Response, PACOPS noted that it used a “reasonable common-sense assessment” to
determine that the facility was located within an HCA, based on its proximity to the ocean.
Respondent’s choice to “conservatively define” the onshore portion of its pipeline as being



CPF No. 5-2017-7004
Page 5
within an HCA is documented in the company’s 2016 assessment records. In the instant case, I
agree with Respondent that detailed analyses and calculations are not necessary to support the
inclusion of PACOPS’ pipe within an HCA. The onshore pipeline facility is located within 220
yards of the mean high-tide line, a fact sufficient to support Respondent’s documented decision
to “conservatively define” the facility as being within an HCA.
Accordingly, after considering all of the evidence, I find that Respondent did not commit a
violation of 49 C.F.R. § 195.452(b)(5). Based upon the foregoing, I hereby order that Item 3 be
withdrawn.
These findings of violation will be considered prior offenses in any subsequent enforcement
action taken against Respondent.
ASSESSMENT OF PENALTY
Under 49 U.S.C. § 60122, Respondent is subject to an administrative civil penalty not to exceed
$200,000 per violation for each day of the violation, up to a maximum of $2,000,000 for any
related series of violations.5 In determining the amount of a civil penalty under 49 U.S.C.
§ 60122 and 49 C.F.R. § 190.225, I must consider the following criteria: the nature,
circumstances, and gravity of the violation, including adverse impact on the environment; the
degree of Respondent’s culpability; the history of Respondent’s prior offenses; any effect that
the penalty may have on its ability to continue doing business; and the good faith of Respondent
in attempting to comply with the pipeline safety regulations. In addition, I may consider the
economic benefit gained from the violation without any reduction because of subsequent
damages, and such other matters as justice may require.
Item 2: The Notice proposed a civil penalty of $15,500 for Respondent’s violation of 49 C.F.R.
§ 195.440(a), for failing to implement its written continuing education program pursuant to API
RP 1162. Respondent’s arguments relating to the allegations of violation, as outlined above, are
without merit. Respondent did not otherwise submit information that warrants reducing the civil
penalty. Accordingly, having reviewed the record and considered the assessment criteria, I
assess Respondent a civil penalty of $15,500 for violation of 49 C.F.R. § 195.440(a).
Payment of the civil penalty must be made within 20 days of service. Federal regulations (49
C.F.R. § 89.21(b)(3)) require such payment to be made by wire transfer through the Federal
Reserve Communications System (Fedwire), to the account of the U.S. Treasury. Detailed
instructions are contained in the enclosure. Questions concerning wire transfers should be
directed to: Financial Operations Division (AMK-325), Federal Aviation Administration, Mike
Monroney Aeronautical Center, 6500 S MacArthur Blvd, Oklahoma City, Oklahoma 79169.
The Financial Operations Division telephone number is (405) 954-8845.
Failure to pay the $15,500 civil penalty will result in accrual of interest at the current annual rate
5 These amounts are adjusted annually for inflation. See, e.g., Pipeline Safety: Inflation Adjustment of Maximum
Civil Penalties, 82 Fed. Reg. 19325 (April 27, 2017).



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in accordance with 31 U.S.C. § 3717, 31 C.F.R. § 901.9 and 49 C.F.R. § 89.23. Pursuant to
those same authorities, a late penalty charge of six percent (6%) per annum will be charged if
payment is not made within 110 days of service. Furthermore, failure to pay the civil penalty
may result in referral of the matter to the Attorney General for appropriate action in a district
court of the United States.
COMPLIANCE ORDER
The Notice proposed a compliance order with respect to Items 1, 2, and 3 in the Notice for
violations of 49 C.F.R. §§ 195.9, 195.440(a), and 195.452(b)(5), respectively. Under 49 U.S.C.
§ 60118(a), each person who engages in the transportation of hazardous liquids or who owns or
operates a pipeline facility is required to comply with the applicable safety standards established
under chapter 601.
Respondent argued that the proposed compliance terms should be withdrawn, along with the
violations. With regard to Items 1 and 2, as discussed above, Respondent’s arguments as to the
allegation of violation are not persuasive. Accordingly, I find no reason to modify the
compliance terms with respect to Items 1 and 2. With regard to Item 3, I agree with
Respondent’s arguments, and have ordered that Item 3 be withdrawn. Accordingly, I also
withdraw the compliance terms with respect to Item 3.
For the above reasons, the Compliance Order is modified as set forth below.
Pursuant to the authority of 49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217, Respondent is
ordered to take the following actions to ensure compliance with the pipeline safety regulations
applicable to its operations:
1. With respect to the violation of § 195.9 (Item 1), Respondent must identify on all
its Outer Continental Shelf pipelines the specific points at which operating
responsibility transfers to a producing operator by durable marking. If it is not
practicable to durably mark a transfer point and the transfer point is located above
water, the operator must depict the transfer point on a schematic maintained near the
transfer point. Pictures or any other documentation to show compliance with 49
C.F.R. § 195.9 must be submitted to PHMSA within 30 days after receipt of this Final
Order.
2. With respect to the violation of § 195.440(a) (Item 2), Respondent must submit
records such as stakeholder lists, brochures or pamphlets indicating message,
documentation of sent messages, maps, procedures, plans, evaluation results, follow-
up actions, and other relevant documentation that supports compliance with 49 C.F.R.
§ 195.440(a) to PHMSA within 180 days after receipt of this Final 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.



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It is requested that Respondent maintain documentation of the safety improvement costs
associated with fulfilling this Compliance Order and submit the total to the Director. It is
requested that these costs be reported in two categories: (1) total cost associated with
preparation/revision of plans, procedures, studies and analyses; and (2) total cost associated with
replacements, additions and other changes to pipeline infrastructure.
Failure to comply with this Order may result in the administrative assessment of civil penalties
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.
WARNING ITEM
With respect to Item 4, the Notice alleged a probable violation of Part 195 but did not propose a
civil penalty or compliance order for this item. Therefore, this is considered to be a warning
item. The warning was for:
49 C.F.R. § 195.583(a) (Item 4) ─ Respondent’s alleged failure to inspect each
pipeline or portion of pipeline that is exposed to the atmosphere for evidence of
atmospheric corrosion.
PACOPS requested withdrawal of Item 4, alleging that the company’s third-party contractors
performed atmospheric corrosion checks during other physical inspections of the facility. Under
§ 190.205, PHMSA does not adjudicate warning items to determine whether or not a probable
violation occurred. If OPS finds a violation of this provision in a subsequent inspection,
Respondent may be subject to future enforcement action.
Under 49 C.F.R. § 190.243, Respondent may submit a Petition for Reconsideration of this Final
Order to the Associate Administrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey
Avenue, SE, East Building, 2nd Floor, Washington, DC 20590, with a copy sent to the Office of
Chief Counsel, PHMSA, at the same address, no later than 20 days after receipt of service of this
Final Order by Respondent. Any petition submitted must contain a statement of the issue(s) and
meet all other requirements of 49 C.F.R. § 190.243. The filing of a petition automatically stays
the payment of any civil penalty assessed. The other terms of the order, including corrective
action, remain in effect unless the Associate Administrator, upon request, grants a stay.
The terms and conditions of this Final Order are effective upon service in accordance with 49
C.F.R. § 190.5.
May 3, 2019
___________________________________ __________________________
Alan K. Mayberry Date Issued
Associate Administrator
for Pipeline Safety
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