{"operation":"document","citation":"CPF 520186001S","title":"HECO - HAWAIIAN ELECTRIC COMPANY, INC. — Safety Order","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2018-01-09","effective_on":null,"summary":"CLOSED safety order.","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520186001s.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520186001s.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520186001s","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520186001S","body":"Safety Order involving HECO - HAWAIIAN ELECTRIC COMPANY, INC.. The dataset does not identify a cited regulation for this case. The case was opened on 2018-01-09 and is reported as closed as of 2019-04-08. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520186001S_Closure Letter_04082019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520186001S/520186001S_Closure%20Letter_04082019.pdf\n\n520186001S_Closure Letter_04082019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520186001S/520186001S_Closure%20Letter_04082019_text.pdf\n\n520186001S_Consent Order and Agreement_05182018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520186001S/520186001S_Consent%20Order%20and%20Agreement_05182018.pdf\n\n520186001S_Consent Order and Agreement_05182018_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520186001S/520186001S_Consent%20Order%20and%20Agreement_05182018_text.pdf\n\n520186001S_Notice Of Proposed Safety Order_01092018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520186001S/520186001S_Notice%20Of%20Proposed%20Safety%20Order_01092018.pdf\n\n520186001S_Notice Of Proposed Safety Order_01092018_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520186001S/520186001S_Notice%20Of%20Proposed%20Safety%20Order_01092018_text.pdf\n\n520186001S_Operator Response to Notice and Requests for Informal Consultation_02092018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520186001S/520186001S_Operator%20Response%20to%20Notice%20and%20Requests%20for%20Informal%20Consultation_02092018.pdf\n\n520186001S_Notice Of Proposed Safety Order_01092018_text.pdf\n\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nJanuary 9, 2018\nMr. Alan M. Oshima\nPresident & Chief Executive Officer\nHawaiian Electric Company, Inc.\n900 Richards Street\nHonolulu, Hawaii 96813\nCPF 5-2018-6001S\nDear Mr. Oshima:\nEnclosed is a Notice of Proposed Safety Order (Notice) issued in the above-referenced case.\nThe Notice proposes that you take certain measures with respect to Hawaiian Electric Company,\nInc.’s Waiau Pipeline, which travels from Kalaeloa through Kapolei, Waipahu, and Pearl City to\nthe Waiau Power Plant, to ensure pipeline safety. Your options for responding are set forth in\nthe Notice. Your receipt of the Notice constitutes service of that document under 49 C.F.R. §\n190.5.\nWe look forward to a successful resolution to ensure pipeline safety. Please direct any\nquestions on this matter to me at 720-963-3183.\nSincerely,\nDustin Hubbard\nActing Director, Western Region\nPipeline and Hazardous Materials Safety Administration\nEnclosures: Notice of Proposed Safety Order\nAttachments:\nA – General Overview Map\nB – Waiau pipeline map showing proximity to Unusually Sensitive Areas\n\n\n\ncc: Mr. Alan K. Mayberry, Associate Administrator for Pipeline Safety, OPS\nMs. Linda Daugherty, Deputy Associate Administrator for Field Operations, OPS\nMr. Ronald R. Cox, Senior Vice President, Operations\n\n\n\nDEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWESTERN REGION\nLAKEWOOD, COLORADO 80228\n________________________________________________\nIn the Matter of )\n)\n)\nHawaiian Electric Company, Inc., )\n) CPF No. 5-2018-6001S\nRespondent. )\n_______________________________________________ )\nNOTICE OF PROPOSED SAFETY ORDER\nBackground and Purpose\nPursuant to Chapter 601 of Title 49, United States Code, the Pipeline and Hazardous Materials\nSafety Administration (PHMSA) has initiated an investigation and information review of the\nsafety of your Waiau Pipeline, which transports low sulfur fuel oil from Barbers Point Tank\nFarm (BPTF) to the Waiau Power Plant in Pearl City, Hawaii, with approximately 12.7 miles of\nin-service pipeline mileage.1\nAs a result of the investigation and information review, it appears that conditions exist on your\npipeline facilities that pose a pipeline integrity risk to public safety, property, or the environment.\nPursuant to 49 U.S.C. § 60117(l), PHMSA issues this Notice of Proposed Safety Order (Notice),\nnotifying you of the preliminary findings of the investigation, and proposing that you take\nmeasures to ensure that the public, property, or the environment are protected from the integrity\nrisks identified in this Notice.\nPreliminary Findings\n The Hawaiian Electric, Inc. (HECO) Waiau Pipeline (Waiau Pipeline or Affected\nSegment) transports low sulfur fuel oil from the Barbers Point Tank Farm (BPTF)\neastwards to the Waiau power generation plant in Pearl City, Hawaii. There is a spur off\nthe pipeline that goes to the Kahe power plant. The Waiau Pipeline is considered a\nhazardous liquids pipeline subject to Federal Pipeline Regulations 49 C.F.R., Part 195.\n The Waiau Pipeline passes through the towns of Kapolei, Waipahu, and Pearl City, HI.\n1 Attachment A, General Overview Map.\n\n\n\n2\n The pipeline is an 8-inch diameter pipe with 0.322 and 0.500-inch wall thickness,\nconsisting of API 5L-X42 grade pipe. The pipeline is coated with fusion bonded epoxy\ncoating, with 2-inch urethane foam insulation and a High Density Polyethylene (HDPE)\njacket. The pipeline was installed in 2004.\n The product being transported by the Waiau Pipeline is low sulfur fuel oil that is typically\nintroduced into the pipeline at a temperature of 200 °F when it enters the line.\n The Waiau Pipeline was initially hydrostatically tested in 2004 and put into service as a\n1350 psig MOP pipeline later that year. The normal operating pressure for the pipeline is\nbetween 150 and 200 psig.\n The Waiau Pipeline runs alongside much of Hawaii Highway 1, numerous roads, and\nother transportation corridors. The line crosses near Pearl Harbor and terminates in Pearl\nCity, HI. The Waiau Pipeline is located in a High Consequence Area (HCA) due to its\nproximity to the populations of Pearl Harbor and Honolulu, as well as its proximity to\nUnusually Sensitive Area (USA) drinking water resource and ecological resource.2\n The Waiau Pipeline crosses geological formations and soils that are potentially abrasive\nsuch as volcanic rock and coral sands.\n The following integrity risk conditions have been identified on the Affected Segment:\nHECO installed the Waiau pipeline, a below ground insulated and HDPE jacketed\npipeline, in 2004. A below ground insulated pipeline may eventually have corrosion\nproblems due to the fact that applied cathodic protection (CP) (either impressed or\ngalvanic), is not able to reach the wall of the pipeline. Eventually, the jacket of the\npipeline can fail, allowing moisture to ingress into the foam insulation causing corrosion.\nAlthough CP may be applied to an insulated pipeline, the CP current typically cannot\npass through the insulation and corrosion of the underlying steel pipe may occur where\nthe insulation contains water. Coupled with heat from the pipeline, the corrosion may\nbecome accelerated and “corrosion under insulation” (CUI) may occur. CUI can occur\ndespite normally adequate amounts of impressed CP being applied. Furthermore, CP\nmonitoring methods utilizing conventional methods, e.g. test stations, half cells, and close\ninterval surveys, typically cannot detect CUI.\n PHMSA identified these risk conditions as a result of several inspections of the Waiau\npipeline since 2004, from the conclusions of a NACE International (NACE) technical\ncommittee report titled “Effectiveness of Cathodic Protection on Thermally Insulated\nUnderground Metallic Structures” dated September 2006 (NACE International\nPublication 10A392, 2006 Edition) (NACE Report), and from lessons learned from the\nMay 19, 2015 Plains pipeline spill in Santa Barbara County, California that occurred on a\nheated insulated pipeline where the coating had become compromised (Plains release).\nThe results of that accident report were issued to the public on May 20, 2016. An\n2 Attachment B, Map of Unusually Sensitive Area’s traversed by the Waiau Pipeline.\n\n\n\n3\nAdvisory Bulletin, (ADB-2016-04) (PHMSA-2016-0071) dated June 15, 2016, (ADB),\nwas also issued alerting pipeline operators to the potential corrosion risks associated with\ninsulated pipelines.\n The NACE Report was prepared as a guide for external corrosion control of thermally-\ninsulated underground metallic surfaces and considerations of the effectiveness of CP.\nThe NACE report made the following conclusions: (1) ‘‘Generally, the application of\nexternal CP to thermally insulated metallic surfaces has been ineffective; (2) The\nprincipal or primary means of corrosion control of thermally-insulated metallic surfaces\nis the application of an effective coating on the metallic surface; (3) Care is typically\ntaken in the application of the external jacket and during pipe installation to minimize\nwater ingress, which causes corrosion at imperfections in the primary coating; (4) When\npractical, the thermally insulated metallic surfaces need to be inspected at routine time\nintervals for metal loss (e.g., an internal pipeline inspection tool could be used).’’3\n As discussed in the ADB, insulated coatings on buried pipes can result in a corrosion\nbyproduct that occurs between the insulation and the exterior pipe wall and results in In-\nLine Inspection (ILI) surveys that underestimate the amount of corrosion present. This\nwas identified by PHMSA as a contributing factor to the Plains release and is a\ndocumented integrity risk on below ground insulated pipelines.4\n PHMSA conducted construction inspections during the installation of the Waiau pipeline\nin 2004. Standard inspections were conducted in 2005 and 2008. An Integrated\nInspection was conducted in March, 2016. As a result of the inspection, PHMSA\ndetermined that the foam insulation and HDPE jacket on the pipeline would shield any\nCP from reaching the pipe wall if the jacket was compromised, and water infiltrated the\ninsulation. Accurate CP monitoring of the entire pipeline would also not be possible.\n The last ILI was conducted in November 2013 utilizing a Magnetic Flux Leakage (MFL)\ntool. The results of the inspection activities indicate the Waiau Pipeline is affected by\nmetal loss corrosion anomalies with the majority of the metal loss indications between 10\nand 19% wall loss.\n By letter dated November 13, 2017, HECO made a formal request to PHMSA for a\nSpecial Permit for its Waiau pipeline for the purpose of addressing the issues identified in\nthis Notice and to ensure compliance with 49 CFR § 195.571. PHMSA is currently\nevaluating HECO’s special permit application.\n The serviceability of the Waiau Pipeline is currently impaired because the risk conditions\nidentified above could result in a failure of the pipeline. A failure on the Waiau Pipeline\ncould result in the release of low sulfur fuel oil into HCA locations in and around\nHonolulu, HI and Pearl Harbor, HI. The potential spill would affect commercial\n3 See NACE Report.\n4 See ADB.\n\n\n\n4\nproperties, residential properties, and tourism in the area in and around the Waiau\nPipeline. The Pearl Harbor area is a National Monument and tourist attraction.\nProposed Issuance of Safety Order\nSection 60117(l) of Title 49, United States Code, provides for the issuance of a safety order, after\nreasonable notice and the opportunity for a hearing, requiring corrective measures, which may\ninclude physical inspection, testing, repair, or other action, as appropriate. The basis for making\nthe determination that a pipeline facility has a condition or conditions that pose a pipeline integrity\nrisk to public safety, property, or the environment is set forth both in the above-referenced statute\nand 49 C.F.R. § 190.239, a copy of which is enclosed.\nAfter evaluating the foregoing preliminary findings of fact and considering the age of the pipe\ninvolved, the hazardous nature of the product transported and the pressure required for transporting\nsuch product, the characteristics of the geographical areas where the pipeline facility is located,\nthe environmentally sensitive area in and around the location of the Waiau pipeline, the likelihood\nof CUI occurring, and the likelihood that the conditions could worsen or develop on other areas of\nthe pipeline and potentially impact its serviceability, it appears that the continued operation of the\nAffected Segment without corrective measures poses a pipeline integrity risk to public safety,\nproperty, or the environment.\nAccordingly, PHMSA issues this Notice of Proposed Safety Order to notify Respondent of the\nproposed issuance of a safety order and to propose that Respondent take measures specified herein\nto address the potential risk.\nResponse to this Notice\nIn accordance with § 190.239, you have 30 days following receipt of this Notice to submit a\nwritten response to the official who issued the Notice. If you do not respond within 30 days, this\nconstitutes a waiver of your right to contest this Notice and authorizes the Associate\nAdministrator for Pipeline Safety to find facts as alleged in this Notice without further notice to\nyou and to issue a Safety Order. In your response, you may notify that official that you intend to\ncomply with the terms of the Notice as proposed, or you may request that an informal\nconsultation be scheduled (you will also have the opportunity to request an administrative\nhearing before a safety order is issued). Informal consultation provides you with the opportunity\nto explain the circumstances associated with the risk condition(s) alleged in the notice and, as\nappropriate, to present a proposal for a work plan or other remedial measures, without prejudice\nto your position in any subsequent hearing. If you and PHMSA agree within 30 days of informal\nconsultation on a plan and schedule for you to address each identified risk condition, we may\nenter into a written consent agreement (PHMSA would then issue an administrative consent\norder incorporating the terms of the agreement). If a consent agreement is not reached, or if you\nhave elected not to request informal consultation, you may request an administrative hearing in\nwriting within 30 days following receipt of the Notice or within 10 days following the\nconclusion of an informal consultation that did not result in a consent agreement, as applicable.\nFollowing a hearing, if the Associate Administrator finds the facility to have a condition that\n\n\n\n5\nposes a pipeline integrity risk to the public, property, or the environment in accordance with §\n190.239, the Associate Administrator may issue a safety order\nBe advised that all material you submit in response to this enforcement action is subject to being\nmade publicly available. If you believe that any portion of your responsive material qualifies for\nconfidential treatment under 5 U.S.C. 552(b), along with the complete original document you\nmust provide a second copy of the document with the portions you believe qualify for\nconfidential treatment redacted and an explanation of why you believe the redacted information\nqualifies for confidential treatment under 5 U.S.C. 552(b).\nIn your correspondence on this matter, please refer to CPF 5-2018-6001S and for each document\nyou submit, please provide a copy in electronic format whenever possible.\nProposed Corrective Measures\nPursuant to 49 U.S.C. § 60117(l) and 49 C.F.R. § 190.239, PHMSA proposes to issue to HECO a\nsafety order incorporating the following remedial requirements with respect to the Affected\nSegment:\n1. To ensure continued safety, HECO shall conduct biennial ILI surveys, and investigate all\nanomalies that exceed more than 40% of the nominal wall thickness. The tool used for\nthe first ILI run must utilize ultrasonic technologies, subsequent ILI runs will alternate\ntechnologies between magnetic flux leakage (MFL) and ultrasonic technologies.\nThe entire length of the Affected Segment shall be patrolled at least two times per week.\nThe first ILI run referenced in this Notice shall be conducted no later than 60 days after\nthe issuance of a final safety order, and subsequent ILI surveys shall be conducted at the\nintervals not exceeding 30 months, but at least once each two calendar years.\nThere should be at least two calibration digs and anomaly assessments conducted for the\nILI surveys required under this Notice to ensure that the ILI assessment is accurate.\n5. HECO shall provide the Acting Director, Western Region, with documentation of\ncompliance and supporting data, to all Items above.\n6. HECO shall submit quarterly reports to the Acting Director, Western Region, that: (1)\ninclude analysis of all available data and results of the testing and evaluations required by\nthe safety order; and (2) describe the progress of the repairs and other remedial actions\nbeing undertaken.\nThe Acting Director, Western Region, may grant an extension of time for compliance with\nany of the terms of the safety order upon a written request timely submitted demonstrating\ngood cause for an extension.\n2. 3. 4. 7.\n\n\n\n6\n8. The items required by the safety order shall remain in effect unless and until HECO obtains\na special permit for the Waiau pipeline that addresses the safety concerns identified in this\nNotice.\n9. Respondent may appeal any decision of the Acting Director, Western Region, to the\nAssociate Administrator for Pipeline Safety. Decisions of the Associate Administrator\nshall be final.\nThe actions proposed by this Notice of Proposed Safety Order are in addition to and do not waive\nany requirements that apply to Respondent’s pipeline system under 49 C.F.R. Parts 190 through\n199, under any other order issued to Respondent under authority of 49 U.S.C. § 60101 et seq., or\nunder any other provision of Federal or state law.\nAfter receiving and analyzing additional data in the course of this proceeding and implementation\nof the work plan, PHMSA may identify other safety measures that need to be taken. In that event,\nRespondent will be notified of any proposed additional measures and, if necessary, amendments\nto the work plan or safety order.\n___________________________________ __________________\nDustin Hubbard Date issued\nActing Director, Western Region\nPipeline and Hazardous Materials Safety Administration\n\n520186001S_Closure Letter_04082019_text.pdf\n\nCERTIFIED MAIL – RETURN RECEIPT REQUESTED\nApril 8, 2019\nMr. Alan M. Oshima\nPresident & Chief Executive Officer\nHawaiian Electric Company, Inc.\n900 Richards Street\nHonolulu, Hawaii 96813\nRE: CPF 5-2018-6001S\nCase Closure\nDear Mr. Oshima:\nOn May 18, 2018, the Pipeline and Hazardous Materials Safety Administration (PHMSA)\nissued a Consent Order and Consent Agreement (Agreement) to Hawaiian Electric Company,\nInc. (HECO). The Agreement required HECO to implement certain corrective measures to\naddress the safety concerns with the Waiau Pipeline, which transports low sulfur fuel oil from\nBarbers Point Tank Farm (BPTF) to the Waiau Power Plant in Pearl City, Hawaii.\nThe corrective measures required by the Agreement are as follows: (1) perform In-Line\ninspections (ILI) using alternate technologies (magnetic flux leakage and ultrasonic\ntechnologies); (2) prepare a corrosion risk model incorporating all susceptible corrosion risk\nfactors, and incorporate the risk model into HECO’s integrity management plan; (3)\ninvestigate, through calibration digs and anomaly assessments, at least four ILI anomalies that\nexceed 10% of the nominal wall thickness but do not exceed 35% of the nominal wall\nthickness; (4) investigate, through calibration digs and anomaly assessments, all ILI\nanomalies that exceed 35% nominal wall thickness; and (4) submit quarterly reports detailing\nall available data and results from the testing and evaluations required by the Agreement.\nOn several occasions between November and December 2018, PHMSA personnel conducted\nfield inspections of the Waiau Pipeline to ensure HECO’s compliance with the Agreement.\nBased on the inspections, and a review of the required submittals from HECO, PHMSA has\ndetermined that HECO is in compliance with the Agreement.\nThe Agreement required HECO to continue implementing the corrective measures contained\ntherein until they were all completed, or until HECO obtained a Special Permit for operation\n\n\n\nof the Waiau Pipeline. HECO was granted a Special Permit for operation of the Waiau\nPipeline (PHMSA-2017-0155) on October 2, 2018. Accordingly, HECO has successfully\ncompleted the terms of the Agreement and this case is now closed with no further\nenforcement action with respect to the matters involved in this case.\nSincerely,\nChris Hoidal\nActing Director, Western Region\nPipeline and Hazardous Materials Safety Administration\ncc: PHP-60 Compliance Registry\nPHP-500 R. Guisinger 159059\n\n520186001S_Consent Order and Agreement_05182018_text.pdf\n\nMay 18, 2018\nVIA CERTIFIED MAIL AND FAX TO: (907) 777-8301\nMr. Alan M. Oshima\nPresident & Chief Executive Officer\nHawaiian Electric Company, Inc.\n900 Richards Street\nHonolulu, Hawaii 96813\nCPF No. CPF 5-2018-6001S\nDear Mr. Oshima:\nEnclosed please find a Consent Order incorporating the terms of the Consent Agreement between\nthe Pipeline and Hazardous Materials Safety Administration (PHMSA) and Hawaiian Electric\nCompany, Inc. (HECO) which was executed on May 17, 2018. Service of the Consent Order and\nConsent Agreement by certified mail is deemed effective upon the date of mailing, or as otherwise\nprovided under 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nAlan K. Mayberry\nAssociate Administrator\nfor Pipeline Safety\nEnclosure: Order and Consent Agreement\ncc: Ms. Kim West, Director, Western Region, OPS\nMr. Chris Hoidal, Senior Technical Advisor, Program Development, OPS\nMr. Derek Sato, Director, Fuels Infrastructure, Fuels, HECO, at\nderek.sato@hawaiianelectric.com\nMr. K. Noa Dettweiler-Pavia, Associate General Counsel, HECO, at\nKahikino.dettweiler@hawaiianelectric.com\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\n______\n)\nIn the Matter of )\n)\nHawaiian Electric Company, Inc., ) CPF No. 5-2018-6001S\n)\nRespondent. )\n)\nCONSENT ORDER\nBy letter dated January 9, 2018, the Pipeline and Hazardous Materials Safety Administration\n(PHMSA), Office of Pipeline Safety (OPS or Agency), issued a Notice of Proposed Safety Order\n(Notice) to Hawaiian Electric Company, Inc. (HECO or Respondent).\nIn accordance with 49 C.F.R. § 190.239, the Notice alleged that conditions exist on\nRespondent’s Waiau Pipeline that pose a pipeline integrity risk to public safety, property, or the\nenvironment. The Notice also proposed that Respondent take certain corrective measures to\nremedy the alleged conditions and ensure that the public, property, and the environment are\nprotected from the potential risk.\nIn response to the Notice, Respondent requested an informal consultation, whereupon the parties\nengaged in good-faith settlement discussions that have resulted in the Consent Agreement\nattached to this Consent Order that settles all of the allegations in the Notice.\nAccordingly, the Consent Agreement is hereby approved and incorporated by reference into this\nConsent Order. The Respondent is hereby ordered to comply with the terms of the Consent\nAgreement, effective immediately.\nPursuant to 49 U.S.C. 60101, et seq., failure to comply with this Consent Order may result in the\nassessment of civil penalties of up to $200,000, as adjusted for inflation (see 49 C.F.R.\n§ 190.223), for each violation for each day the violation continues or in referral to the Attorney\nGeneral for appropriate relief in a district court of the United States.\nThe terms and conditions of this Consent Order are effective upon service in accordance with\n49 C.F.R. § 190.5.\nMay 18, 2018\nAlan K. Mayberry Date\nAssociate Administrator\nfor Pipeline Safety\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\n____________________________________\nIn the Matter of\nHawaiian Electric Company, Inc.,\nRespondent.\n)\n)\n)\n)\n)\n)\n)\nCPF No. 5-2018-6001S\nCONSENT AGREEMENT\nOn January 9, 2018, the Pipeline and Hazardous Materials Safety Administration (PHMSA),\nOffice of Pipeline Safety (OPS or Agency), issued a Notice of Proposed Safety Order (Notice) to\nHawaiian Electric Company, Inc. (HECO or Respondent). The Notice alleged that conditions\nexist on Respondent’s Waiau Pipeline that pose a pipeline integrity risk to public safety,\nproperty, or the environment. The Notice also proposed that Respondent take certain corrective\nmeasures to remedy the alleged conditions and ensure that the public, property, and the\nenvironment are protected from the potential risk.\nHECO responded to the Notice by timely submitting a written response and a request for an\ninformal consultation. An informal consultation was held on March 13, 2018 at HECO’s office\nin Barbers Point, Hawaii.\nAs a result of the informal consultation, PHMSA and HECO (collectively, Parties) agreed that\nsettlement of this proceeding will avoid further administrative proceedings or litigation of the\nNotice and that entry into this Consent Agreement (Agreement) is the most appropriate means of\nresolving the issues raised in the Notice and is generally in the public interest. Therefore,\npursuant to 49 C.F.R. Part 190, without adjudication of any issue of fact or law, and upon\nconsent and agreement of HECO and PHMSA, the Parties agree as follows:\nI. General Provisions\n1. Respondent acknowledges that as the operator of the Waiau Pipeline, Respondent\nand its Waiau Pipeline system is subject to the jurisdiction of the Federal pipeline safety laws, 49\nU.S.C. § 60101, et seq., and the regulations and administrative orders issued thereunder. For\npurposes of this Agreement, Respondent acknowledges that it received proper notice of\nPHMSA's action in this proceeding and that the Notice states claims upon which relief may be\ngranted pursuant to 49 U.S.C. 60101, et seq., and the regulations and orders issued thereunder.\nThe Waiau Pipeline transports low sulfur fuel oil from the Barbers Point Tank Farm (BPTF)\neastwards to the Waiau power generation plant in Pearl City, Hawaii, and is defined more\nspecifically as the Affected Pipeline Facility in Paragraph 12(a) of this Agreement.\n\n\n\nCPF No. 5-2018-6001S\nPage 2\n2. Respondent agrees, for purposes of this Agreement, to address the integrity risks\nidentified in the Notice by completing the actions specified in Section II of this agreement\n(Corrective Measures) and to abide by the terms of this Agreement. This Agreement does not\nconstitute a finding of violation of any Federal law or regulation and may not be used in any civil\nor administrative proceeding of any kind as evidence or proof of any fact, fault or liability, or as\nevidence of the violation of any law, rule, regulation or requirement, except in a proceeding to\nenforce the provisions of this Agreement.\n3. After Respondent returns this signed Agreement to PHMSA, the Agency’s\nrepresentative will present it to the Associate Administrator for Pipeline Safety, recommending\nthat the Associate Administrator adopt the terms of this Agreement by issuing an administrative\norder (Consent Order) incorporating the terms of this Agreement. The terms of this Agreement\nconstitute an offer of settlement until accepted by the Associate Administrator. Once accepted,\nthe Associate Administrator will issue a Consent Order incorporating the terms of this Agreement.\n4. Respondent consents to the issuance of the Consent Order, and hereby waives any\nfurther procedural requirements with respect to its issuance. Respondent waives all rights to\ncontest the adequacy of notice, or the validity of the Consent Order or this Agreement, including\nall rights to administrative or judicial hearings or appeals, except as set forth herein.\n5. This Agreement shall apply to and be binding upon PHMSA, and upon HECO, its\nofficers, directors, and employees, and its successors, assigns, or other entities or persons\notherwise bound by law. Respondent agrees to provide a copy of this Agreement and any\nincorporated work plans and schedules to all of HECO’s officers, employees, and agents whose\nduties might reasonably include compliance with this Agreement.\n6. For all transfers of ownership or operating responsibility of HECO’s Waiau\nPipeline, Respondent will provide a copy of this Agreement to the prospective transferee at least\n30 days prior to such transfer and simultaneously provide written notice of the prospective\ntransfer to the PHMSA Western Region Director (Director) who issued the Notice.\n7. This Agreement constitutes the final, complete and exclusive agreement and\nunderstanding between the Parties with respect to the settlement embodied in this Agreement.\nThe Parties acknowledge that there are no representations, agreements or understandings relating\nto settlement other than those expressly contained in this Agreement, except that the terms of this\nAgreement may be construed by reference to the Notice.\n8. Nothing in this Agreement affects or relieves Respondent of its responsibility to\ncomply with all applicable requirements of the Federal pipeline safety laws, 49 U.S.C. § 60101,\net seq., and the regulations and orders issued thereunder. Nothing in this Agreement alters\nPHMSA's right of access, entry, inspection, and information gathering or PHMSA's authority to\nbring enforcement actions against HECO pursuant to the Federal pipeline safety laws, the\nregulations and orders issued thereunder, or any other provision of Federal or State law.\n\n\n\nCPF No. 5-2018-6001S\nPage 3\n9. This Agreement does not waive or modify any Federal, State, or local laws or\nregulations that are applicable to Respondent’s pipeline systems. This Agreement is not a\npermit, or a modification of any permit, under any Federal, State, or local laws or regulations.\nHECO remains responsible for achieving and maintaining compliance with all applicable\nFederal, State, and local laws, regulations and permits.\n10. This Agreement does not create rights in, or grant any cause of action to, any third\nparty not party to this Agreement. The U.S. Department of Transportation is not liable for any\ninjuries or damages to persons or property arising from acts or omissions of Respondent or its\nofficers, employees, or agents carrying out the work required by this Agreement. HECO agrees\nto hold harmless the U.S. Department of Transportation, its officers, employees, agents, and\nrepresentatives from any and all causes of action arising from any acts or omissions of\nRespondent or its contractors in carrying out any work required by this Agreement.\n11. Measures set forth below.\nUpon issuance of the Consent Order, HECO agrees to perform the Corrective\n12. Definitions:\na. The Affected Pipeline Facility means the 8-inch diameter pipe with 0.322 and\n0.500-inch wall thickness, consisting of API 5L-X42 grade pipe. The pipeline is\ncoated with fusion bonded epoxy coating, with 2-inch urethane foam insulation\nand a High Density Polyethylene (HDPE) jacket. The pipeline was installed in\n2004.\nb. The Affected Segment means the Waiau Pipeline, which transports low sulfur\nfuel oil from Barbers Point Tank Farm (BPTF) to the Waiau Power Plant in Pearl\nCity, Hawaii, with approximately 12.7 miles of in-service pipeline mileage. The\nAffected Segment runs alongside the Hawaii Highway 1 in two short sections, and\nit crosses the light rail system at various points along the 12.7 miles of in-service\npipeline mileage. The Affected Segment is located in a High-Consequence Area\n(HCA) due to its proximity to the populations of Pearl Harbor and Honolulu, as\nwell as its proximity to Unusually Sensitive Area (USA) ecological resource.\nII. Corrective Measures\n13. In-Line Inspection (ILI) Assessment. HECO shall conduct ILI surveys, and\ninvestigate, through calibration digs and anomaly assessments, all anomalies that exceed more\nthan 35% of the nominal wall thickness. The tool used for the first ILI survey must utilize\nmagnetic flux leakage (MFL) technologies. The second ILI survey must utilize ultrasonic\ntechnologies. Subsequent ILI surveys will alternate technologies between MFL and ultrasonic\ntechnologies (UT).\na. HECO must conduct the first MFL ILI survey required by this Agreement no\nlater than 60 days after the issuance of a Consent Order. HECO may submit\n\n\n\nCPF No. 5-2018-6001S\nPage 4\nb. c. d. written documentation of the MFL ILI survey completed on or about April 17,\n2018 to the Director to satisfy this requirement.\nHECO must conduct the first UT ILI survey required by this Agreement no\nlater than 12 months after completion of the first MFL ILI survey required by\nthis Agreement.\nAll subsequent ILI surveys required by this Agreement shall be conducted at\nintervals not exceeding 30 months, but at least once every two calendar years.\nThe results (draft and final reports) of the ILI surveys required by this\nparagraph must be sent to the Director within 30 days of receipt of each ILI\nvendor's report by HECO. Documentation of all subsequent anomaly\nassessments and associated repairs, must be sent to the Director within 30\ndays following completion of each anomaly assessment, and or repair.\n14. Patrols. HECO must patrol the entire length of the Affected Segment at least one\ntime per week. The patrols required by this paragraph shall continue until the Director provides\nwritten notification to HECO that the patrols are no longer required.\n15. Risk Model. HECO shall develop a corrosion risk model of the Affected Segment\nand submit the risk model to the Director for review and written approval within 90 days of the\nissuance of this Consent Agreement. The risk model required by this paragraph must incorporate\nall susceptible corrosion risk factors such as terrain, water and road crossings, AC/DC\ninterference, soil pH, standing water locations, coating failure, and all verified data from\nprevious calibration digs and ILI results. The risk model required by this paragraph shall be\nincorporated into HECO’s integrity management plan and further developed with future ILI and\nintegrity assessments. This model shall identify the highest areas of susceptible corrosion and\nHECO shall use the data to mitigate or investigate those areas.\n16. Calibration Digs for Anomalies Between 11% and 35% of the Nominal Wall\nThickness. In addition to the calibration digs required by paragraph 13 of this Agreement,\nHECO must investigate, through calibration digs and anomaly assessments, at least four\nanomalies on the first MFL run required by paragraph 13 of this Agreement that exceed 10% of\nthe nominal wall thickness but do not exceed 35% of the nominal wall thickness. If there are\nmore than four anomalies between 11% and 35% of the nominal wall thickness identified on the\nfirst MFL run required by paragraph 13 of this Agreement, the calibration digs and anomaly\nassessments required by this paragraph shall be conducted pursuant to the risk model required by\nparagraph 15 of this Agreement.\n17. Documentation. HECO must retain on file documentation of compliance and\nsupporting data to all Items above until this Consent Agreement is terminated. HECO must\nprovide copies of documentation referenced in this paragraph upon written request by the\nDirector.\n18. Quarterly Reports. HECO must submit quarterly reports to the Director that:\n(1) include analysis of all available data and results of the testing and evaluations required by\nthis Agreement; and (2) describe the progress of the repairs and other remedial actions being\nundertaken. The first report will be due 45 days from issuance of a final Consent Order.\n\n\n\nCPF No. 5-2018-6001S\nPage 5\n19. Extensions of Time. The Director may grant an extension of time for\ncompliance with any of the terms of the Agreement upon a written request timely submitted\ndemonstrating good cause for an extension. The Director shall respond in writing to any such\nrequest.\n20. Appeals. Respondent may appeal any decision of the Director to the Associate\nAdministrator for Pipeline Safety. Decisions of the Associate Administrator will be final.\nIII. Review and Approval Process\n21. With respect to any submission under Section II (Corrective Measures) of this\nAgreement that requires the approval of the Director, the Director may: (a) approve, in whole or\nin part, the submission, (b) approve the submission on specified, reasonable conditions, (c)\ndisapprove, in whole or in part, the submission, or (d) any combination of the foregoing. If the\nDirector approves, approves in part, or approves with conditions, HECO will take all action as\napproved by the Director, subject to Respondent's right to invoke the dispute resolution\nprocedures in Section IV with respect to any conditions the Director identifies. If the Director\ndisapproves all or any portion of the submission, the Director will provide HECO with a written\nnotice of the deficiencies. Respondent will correct all deficiencies within the time specified by\nthe Director and resubmit it for approval.\nIV. Dispute Resolution\n22. The Director and HECO will informally attempt to resolve any disputes arising\nunder this Agreement. If Respondent and the Director are unable to informally resolve the\ndispute within 15 days of submittal of Respondent’s invoking dispute resolution, HECO may\nrequest in writing, within 10 days thereafter, a written determination resolving the dispute from\nthe Associate Administrator for Pipeline Safety providing all information that Respondent\nbelieves is relevant to the dispute. If the request is submitted as provided herein, the Associate\nAdministrator will issue a final determination in writing. The existence of a dispute and the\nPHMSA's consideration of matters placed in dispute will not excuse, toll, or suspend any term or\ntimeframe for completion of any work to be performed under this Agreement during the\npendency of the dispute resolution process except as agreed by the Director or the Associate\nAdministrator in writing.\nV. Enforcement\n23. This Agreement, as adopted by the Consent Order, is subject to all enforcement\nauthorities available to the PHMSA under 49 U.S.C. § 60101, et seq., and 49 C.F.R. Part 190. All\nwork plans and associated schedules set forth or referenced in Section II will be automatically\nincorporated into this Agreement and are enforceable in the same manner.\nVI. Recordkeeping and Information Disclosure\n24. Unless otherwise required in this Agreement, HECO agrees to maintain records\ndemonstrating compliance with all requirements of this Agreement for a period of at least five\nyears following completion of all work to be performed. For any reports, plans, or other\n\n\n\nCPF No. 5-2018-6001S\nPage 6\ndeliverables required to be submitted to PHMSA pursuant to this Agreement, Respondent may\nassert a claim of business confidentiality or other protections applicable to the release of\ninformation by PHMSA, covering part or all of the information required to be submitted to\nPHMSA pursuant to this Agreement in accordance with 49 C.F.R. Part 7. Respondent must\nmark the claim of confidentiality in writing on each page, and include a statement specifying the\ngrounds for each claim of confidentially. PHMSA determines release of any information\nsubmitted pursuant to this Agreement in accordance with 49 C.F.R. Part 7, the Freedom of\nInformation Act, 5 U.S.C. § 552, DOT and PHMSA policies, and other applicable regulations\nand Executive Orders.\nVII. Effective Date\n25. The term “Effective Date,” as used herein, is the date on which the Consent Order\nis issued by the Associate Administrator incorporating the terms of this Agreement. Unless\nspecified to the contrary, all deadlines for actions required by this Agreement run from the\nEffective Date of this Consent Order.\nVIII. Modification\n26. The terms of this Agreement may be modified by mutual agreement of the Parties.\nSuch modifications must be in writing and signed by both parties.\nIX. Termination\n27. This Agreement shall remain in effect until the Corrective Measures are satisfied,\nas determined by the","truncated":true,"body_characters":41117}