DEVON ENERGY PRODUCTION CO. LP — Notice of Amendment

party submissionOfficial PDF520196001M_Operator Response to Notice_02062019.pdf#

520196001M_Amended Order Directing Amendment_04102020_text.pdf, page 1Official PDFVIA EMAIL TO: dave.hager@dvn.com and marty.summers@dvn.com Mr. Dave Hager President and Chief Executive Officer Devon Energy Corporation dba Devon Energy Production Company, LP 333 West Sheridan Avenue Oklahoma City, Oklahoma 73102 Re: CPF No. 5-2019-6001M Dear Mr. Hager: Enclosed please find the Amended Order Directing Amendment issued in the above-referenced case. It makes findings of inadequate procedures and requires that Devon Energy Corporation amend certain written procedures. When the amendment of procedures is completed, as determined by the Director, Western Region, this enforcement action will be closed. Service of the Amended Order Directing Amendment by e-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: Mr. Dustin Hubbard, Director, Western Region, Office of Pipeline Safety, PHMSA Mr. Marty Summers, EHS Manager, Devon Energy Corporation VIA EMAIL – CONFIRMATION OF RECEIPT REQUESTED#

520196001M_Amended Order Directing Amendment_04102020_text.pdf, page 2U.S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY WASHINGTON, D.C. 20590 __________________________________________ ) In the Matter of ) ) Devon Energy Corporation, ) CPF No. 5-2019-6001M d/b/a Devon Energy Production Company, LP, ) ) Respondent. ) __________________________________________) AMENDED ORDER DIRECTING AMENDMENT From July 30 to August 2, 2018, 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 written operator qualification (OQ) program of Devon Energy Corporation (Devon or Respondent), a subsidiary of Devon Energy Production Company, LP in Oklahoma City, Oklahoma. Devon is an independent oil and natural gas exploration and production company, with operations focused onshore in the United States. The company operates CO2 pipelines and also produces approximately 140,000 barrels of oil, 575 million cubic feet of natural gas and 80,000 barrels of natural gas liquids per day.1 As a result of the inspection, the Director, Western Region, OPS (Director), issued to Respondent, by letter dated January 10, 2019, a Notice of Amendment (Notice). In accordance with 49 C.F.R. § 190.206, the Notice alleged certain inadequacies in Respondent’s OQ program and proposed requiring Devon to amend its procedures to ensure safe operation of its pipeline facilities. After requesting and receiving an extension of time to respond, Devon responded to the Notice by letter dated February 6, 2019 (Response). The company contested the allegations of inadequacy, provided a summary of its position, and included information concerning changes that it had made to its procedures. Respondent did not request a hearing and therefore has waived its right to one. 1 Devon Energy Production Company, LP website, available at https://www.devonenergy.com/about-us (last accessed February 12, 2020).#

520196001M_Amended Order Directing Amendment_04102020_text.pdf, page 3CPF No. 5-2019-6001M Page 2 FINDINGS OF INADEQUATE PROCEDURES Item 1: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 195.505(b), which states in relevant part: § 195.505 Qualification program. Each operator shall have and follow a written qualification program. The program shall include provisions to: (a) ... (b) Ensure through evaluation that individuals performing covered tasks are qualified; .... The Notice alleged that Respondent’s OQ Program had inadequate qualification methods used to ensure that the individuals performing covered tasks remained qualified to perform those tasks. Specifically, the Notice alleged that the program did not differentiate between methods used for initial qualification versus methods used for requalification. The Notice also alleged that Devon’s OQ Program did not specify standards for testing or performance evaluations, and that the evaluation methods did not provide adequate criteria for evaluators to use to objectively verify individual employees’ knowledge, skills, and abilities. For example, the Notice alleged Devon’s methods for conducting testing did not ensure that qualified employees demonstrated knowledge of its operations and maintenance procedures. In its Response, Devon stated that its OQ Program included adequate qualification methods to ensure that the individuals performing covered tasks remained qualified to perform those tasks. It explained that Section 5 of its OQ Program provides procedures for its qualification process. It stated that it does not differentiate between evaluation methods for initial and requalification because the methods are the same. Section 5.1 of its OQ plan states that “all evaluations ... shall be conducted in accordance with Veriforce Operator Qualification Personnel Evaluation Policies and Procedures” (included in Appendix 6 of its plan). Devon noted that it has incorporated Veriforce’s (a third party) Covered Task Evaluation Criteria, referenced in Appendix 5 of the Program, to ensure each evaluator objectively verifies an individual’s knowledge, skills, and abilities for each Covered Task for both initial and subsequent requalifications. Devon also included an excerpt from its Evaluation Criteria, Form for CT 007 - Operate Valves. This form requires the evaluator to evaluate the individual’s knowledge of “operator-approved procedures” (i.e. Devon's applicable operation and maintenance (O&M) procedures) as part of the evaluation process. I have reviewed Devon’s procedures and for the following reasons find them inadequate. While the procedures include statements regarding requirements to be qualified and how to obtain knowledge and skills, there is not enough detail for individuals and evaluators to understand the methods that will be used to ensure individuals remain qualified. Specifically, Devon must clarify in the program if the methods used for initial qualification and methods used for requalification are the same. Likewise, though Appendix 5 directs the reader to the Veriforce website to obtain current evaluation criteria, the Appendix fails to provide a link to the website. Devon must amend its procedures to either include the correct web address needed to access the#

520196001M_Amended Order Directing Amendment_04102020_text.pdf, page 4CPF No. 5-2019-6001M Page 3 evaluation criteria or list the criteria directly into its procedures. Listing the criteria in the procedures themselves provides the advantage of ensuring that the information is available in the event that the website is unavailable or that criteria are added without Devon’s knowledge or approval. Also, if the website changes, the procedures must be updated accordingly. Devon relies on Veriforce’s Covered Task Evaluation Criteria, but the attached form is not tailored to Devon’s system. Devon may rely on an “off-the-shelf” OQ Program, but must ensure that the program addresses the specific aspects of its own facility. For example, on the Form for CT 007 - Operate Valves, one question asks an individual to identify the most common types of pipeline valves. Identifying types of common valves, however, might be irrelevant if the operator only has ball valves. Performing an inspection on a ball valve might be different than performing an inspection on a gate valve. This question fails to critically evaluate whether the individual has the specific knowledge necessary to perform valve operations on Devon’s system pursuant to Devon's written procedures. The following are other examples of how the procedures do not adequately provide criteria for evaluators to use to objectively verify individual employees' knowledge, skills, and abilities. It is unclear how an evaluator knows whether a test taker has “passed” the oral and action aspects of the examination. Devon’s procedures do not provide criteria that ensure that internal evaluators are uniformly and objectively assessing candidates during these evaluations. Without such criteria, Devon cannot be certain that qualifications are uniform, since what one evaluator finds sufficient might be rejected by another evaluator. This could lead to differences in the minimum levels of skills and knowledge among Devon’s workforce. Veriforce’s generic evaluation criteria are insufficient to determine if an individual is qualified to perform covered tasks on Devon’s pipeline facility. Devon may rely on Verifore’s evaluation criteria, but must also include questions and skill tests tailored specifically to Devon’s unique system and procedural requirements. It should also include specific information on how to score results to promote uniformity and objective administration of the exams. Accordingly, I find that Devon’s procedures were inadequate to ensure safe operation of its pipeline system. Pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.206, Devon is ordered to make revisions to its procedures to address the adequacies within 60 days of the issuance of the Amended Order Directing Amendment. Item 2: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 195.505(c), which states in relevant part: § 195.505 Qualification program. Each operator shall have and follow a written qualification program. The program shall include provisions to: (a) ... (c) Allow individuals that are not qualified pursuant to this subpart to perform a covered task if directed and observed by an individual that is qualified; ...#

520196001M_Amended Order Directing Amendment_04102020_text.pdf, page 5CPF No. 5-2019-6001M Page 4 The Notice alleged that Devon’s written OQ Program did not have an adequate procedure to safely allow non-qualified individuals performing a covered task to be directed by a qualified individual. Specifically, the Notice alleged that the procedures did not adequately address key factors for span of control such as physical distance and communication barriers including noise levels and language comprehension. In its Response, Devon stated that Section 7 of its OQ Program includes adequate procedures to safely allow non-qualified individuals to be directed by a qualified individual. It also stated that key factors for span of control are addressed in sections 7.1 and 7.3 of the Devon OQ Program. In Section 7, the program requires that “individuals who are not qualified to perform a task may perform a task if under the direct supervision of a qualified individual. Direct supervision includes the ability to clearly observe the non-qualified individual’s activities and to take immediate corrective actions when necessary.” In Section 7.1, the program states that a qualified person directing and observing the non-qualified person must be able to intervene to either prevent or react to an abnormal operating condition (AOC). Devon’s span of control requirements includes ensuring that no language barriers exist to preclude communications, the qualified personnel must be in a position where they can direct and observe performance, and intervene if necessary, and only one covered task can be directed and observed at a time. Devon admitted that its procedures do not include provisions to address noise levels, but claimed that noise levels are understood to be included in the provisions regarding language barriers. I find that Devon’s procedures are sufficient regarding physical proximity. While the procedures do not specify a physical distance for observation, they do require that the qualified personnel be able to intervene if necessary. Because they must be standing close enough to the unqualified personnel to be able to intervene, requiring a specific physical proximity is unnecessary. I do find, however, that Devon’s span of control procedures are insufficient in one respect. Devon’s span of control requirements do not address noise levels. The language of its procedures specifically references “language barriers,” therefore it is unclear to the reader that noise levels are meant to be inferred into these requirements. Devon must amend its procedures to specifically address noise levels. Accordingly, I find that Devon’s procedures were inadequate to ensure safe operation of its pipeline system. Pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.206, Devon is ordered to make the above revisions to its procedures within 60 days of the issuance of the Amended Order Directing Amendment. Item 3: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 195.505(g), which states in relevant part: § 195.505 Qualification program. Each operator shall have and follow a written qualification program. The program shall include provisions to: (a) ... (g) Identify those covered tasks and the intervals at which evaluation of the individual's qualifications is needed; ...#

520196001M_Amended Order Directing Amendment_04102020_text.pdf, page 6CPF No. 5-2019-6001M Page 5 The Notice alleged that Devon’s written OQ Program did not have an adequate process or procedure to establish and justify reevaluation intervals, but rather uses an across-the board application of extended reevaluation intervals with no documented justification or basis for that time interval. Specifically, the Notice alleged Devon’s OQ Program did not consider the complexity of the task, the critical nature of the task, or the frequency of task performance (DIF analysis) when establishing reevaluation intervals. The Notice also alleged that Devon’s Program did not identify a minimum time frame for reevaluation upon failure of evaluation for a covered task, nor did it establish how many times an individual would be allowed to attempt the requalification process before the qualification is revoked. In its Response, Devon stated that the NOA was inaccurate in claiming that it uses across the board reevaluation intervals. It states that while many common covered tasks have 3-year intervals, complex tasks have a shorter reevaluation interval based on task complexity, critical nature, and frequency of performance. Devon explained that its Devon Pipeline Governance Committee (PGC) reviewed and adopted Veriforce’s common covered task list (CCTL) and associated evaluation criteria, which were created by comparing and reconciling the existing covered task lists and criteria each client had developed/adopted. Subject matter experts utilized data from their respective individual plans to decide on evaluation method, evaluation criteria, span of control, and requalification intervals for each of the common covered tasks. According to Respondent, Veriforce established and facilitates the CCTL Steering Committee which reviews the adequacy of the CCTL (and underlying task evaluation criteria) on an ongoing basis, as well as potential changes to the CCTL based on things such as stakeholder feedback and regulatory changes. The CCTL steering committee makes recommendations to the larger group of operators who have adopted the CCTL. Devon’s PGC considered this process within its overall evaluation of the Veriforce program, favoring a process that included input and experiences from multiple pipeline operators across the county. In addition, Devon’s PGC includes the appropriateness/effectiveness of task-specific span of control limits during its annual program evaluation. Finally, with regard to identifying a minimum time frame for reevaluation upon failure of evaluation for a covered task and establishing how many times an individual would be allowed to attempt requalification process before the qualification is revoked, Devon noted that its evaluation process specifically states that an individual is deemed “unqualified” in the event of an unsuccessful evaluation per Section 6.10.3 of Veriforce’s Policies and Procedures. In addition, Section 8 of Devon’s OQ program requires training for any individual failing any evaluation prior to any subsequent evaluation attempts. This training must be verified and documented prior to revaluation. Having considered the evidence in the record, I find that Devon’s procedures establishing and justifying reevaluation intervals are insufficient. Devon relies on Veriforce’s criteria which are not tailored to Devon’s specific system, but are created based on a wide pool of operators. In order to be effective, Devon’s procedures must be directly correlated to its own system. While Devon may have criteria for evaluating these intervals, it has not demonstrated that it actually applied that criteria rather than simply adopting Veriforce’s off-the-shelf OQ program. Veriforce must amend its procedures to provide clarity regarding how reevaluations are#

520196001M_Amended Order Directing Amendment_04102020_text.pdf, page 7CPF No. 5-2019-6001M Page 6 conducted and established in order to ensure uniformity. While Devon does have procedures in place regarding its evaluation process, these procedures are inadequate because they do not further define a reevaluation period, but only require an employee to “successfully complete appropriate training before a subsequent evaluation is allowed” under Section 6.9.5. Details such as how many times an individual may be allowed to attempt the requalification process before the qualification is revoked would be helpful for ensuring each employee is properly qualified. It appears that Devon uses the same OQ Program for both its Part 192 and 195 facilities and has adopted Veriforce’s list of covered tasks. I recommend separating the covered tasks related to natural gas and hazardous liquids into their own lists to reduce confusion that may arise if an employee sees a task that does not apply to a certain facility. Accordingly, I find that Devon’s procedures were inadequate to ensure safe operation of its pipeline system. Pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.206, Devon is ordered to make the above revisions to its procedures within 60 days of the issuance of the Amended Order Directing Amendment. The Director may grant an extension of time to comply with any of the required items upon a written request timely submitted by the Respondent and demonstrating good cause for an extension. Failure to comply with this Order may result in administrative assessment of civil penalties not to exceed $213,268, 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. Under 49 C.F.R. § 190.243, Respondent may submit a Petition for Reconsideration of this Amended Order Directing Amendment 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 this Amended Order Directing Amendment 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 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 Amended Order Directing Amendment are effective upon service in accordance with 49 C.F.R. § 190.5. April 10, 2020 ___________________________________ ______________________ Alan K. Mayberry Date Issued Associate Administrator for Pipeline Safety#

520196001M_Notice of Amendment_01102019_text.pdf, page 1Official PDFNOTICE OF AMENDMENT CERTIFIED MAIL - RETURN RECEIPT REQUESTED January 10, 2019 Mr.Dave Hager President and Chief Executive Officer Devon Energy Corporation dba Devon Energy Production Co. LP 333 West Sheridan Avenue Oklahoma City, OK 73102 CPF 5-2019-6001M Dear Mr. Ketter: From July 30 to August 2, 2018, representatives of the Pipeline and Hazardous Materials Safety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code, inspected Devon Energy Corporation’s (Devon) written Operator Qualification (OQ) Program in Oklahoma City, Oklahoma. During the inspection, PHMSA identified apparent inadequacies within Devon’s written OQ procedures, as described below: 1. § 195.505 Qualification Program Each operator shall have and follow a written qualification program. The program shall include provisions to: (a) … (b) Ensure through evaluation that individuals performing covered tasks are qualified; … Devon’s OQ Program had inadequate qualification methods used to ensure that the individuals performing covered tasks remained qualified to perform those tasks. The program did not#

520196001M_Notice of Amendment_01102019_text.pdf, page 2differentiate between methods used for initial qualification versus methods used for re- qualification. Also, Devon’s OQ Program did not specify standards for testing or performance evaluations. The evaluation methods did not provide adequate criteria for evaluators to use to objectively verify individual employees’ knowledge, skills, and abilities. For example, Devon’s methods for conducting testing did not ensure that qualified employees demonstrated knowledge of its operations and maintenance procedures. 2. § 195.505 Qualification Program Each operator shall have and follow a written qualification program. The program shall include provisions to: (a) … (c) Allow individuals that are not qualified pursuant to this subpart to perform a covered task if directed and observed by an individual that is qualified; … Devon’s written OQ Program did not have an adequate procedure to safely allow non-qualified individuals to be directed by a qualified individual, that adequately addressed key factors for span of control such as physical distance and communication barriers including noise levels and language comprehension. 3. § 195.505 Qualification Program Each operator shall have and follow a written qualification program. The program shall include provisions to: (a) … (g) Identify those covered tasks and the intervals at which evaluation of the individual’s qualifications is needed; … Devon’s written OQ Program did not have a process or procedure to establish and justify re- evaluation intervals. The operator uses an across-the board application of extended reevaluation intervals with no documented justification or basis for that time interval. Specifically, Devon’s OQ Program did not consider the complexity of the task, the critical nature of the task, or the frequency of task performance (DIF analysis) when establishing re-evaluation intervals. Devon’s Program also did not identify a minimum time-frame for re-evaluation upon failure of evaluation for a covered task, nor did it establish how many times an individual would be allowed to attempt the requalification process before the qualification is revoked. Response to this Notice This Notice is provided pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.206. Enclosed as part of this Notice is a document entitled Response Options for Pipeline Operators in Compliance Proceedings. Please refer to this document and note the response options. Be advised that all material you submit in response to this enforcement action is subject to being 520196001M_Notice of Amendment_01102019_text#

520196001M_Notice of Amendment_01102019_text.pdf, page 3made publicly available. If you believe that any portion of your responsive material qualifies for confidential treatment under 5 U.S.C. 552(b), along with the complete original document you must provide a second copy of the document with the portions you believe qualify for confidential treatment redacted and an explanation of why you believe the redacted information qualifies for confidential treatment under 5 U.S.C. 552(b). Following the receipt of this Notice, you have 30 days to submit written comments, revised procedures, or a request for a hearing under § 190.211. If you do not respond within 30 days of receipt of this Notice, this constitutes a waiver of your right to contest the allegations in this Notice and authorizes the Associate Administrator for Pipeline Safety to find facts as alleged in this Notice without further notice to you and to issue an Order Directing Amendment. If your plans or procedures are found inadequate as alleged in this Notice, you may be ordered to amend your plans or procedures to correct the inadequacies (49 C.F.R. § 190.206). If you are not contesting this Notice, we propose that you submit your amended procedures to my office within 45 days of receipt of this Notice. This period may be extended by written request for good cause. Once the inadequacies identified herein have been addressed in your amended procedures, this enforcement action will be closed. It is requested (not mandated) that Devon maintain documentation of the safety improvement costs associated with fulfilling this Notice of Amendment (preparation/revision of plans, procedures) and submit the total to Chris Hoidal, Acting Director, Western Region, Pipeline and Hazardous Materials Safety Administration. In correspondence concerning this matter, please refer to CPF 5-2018-6001M and, for each document you submit, please provide a copy in electronic format whenever possible. Sincerely, Chris Hoidal Acting Director, Western Region Pipeline and Hazardous Materials Safety Administration Enclosure: Response Options for Pipeline Operators in Compliance Proceedings cc: PHP-60 Compliance Registry PHP-500 (D. Fehling #160423) Mr. Aaron Ketter, V.P. Rockies 520196001M_Notice of Amendment_01102019_text#

520196001M_Order Directing Amendment_04062020_text.pdf, page 1Official PDFVIA EMAIL TO: dave.hager@dvn.com and marty.summers@dvn.com Mr. Dave Hager President and Chief Executive Officer Devon Energy Corporation dba Devon Energy Production Company, LP 333 West Sheridan Avenue Oklahoma City, Oklahoma 73102 Re: CPF No. 5-2019-6001M Dear Mr. Hager: Enclosed please find the Order Directing Amendment issued in the above-referenced case. It makes findings of inadequate procedures and requires that Devon Energy Corporation amend certain written procedures. When the amendment of procedures is completed, as determined by the Director, Western Region, this enforcement action will be closed. Service of the Order Directing Amendment by e-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: Mr. Dustin Hubbard, Director, Western Region, Office of Pipeline Safety, PHMSA Mr. Marty Summers, EHS Manager, Devon Energy Corporation VIA EMAIL – CONFIRMATION OF RECEIPT REQUESTED#

520196001M_Order Directing Amendment_04062020_text.pdf, page 2U.S. DEPARTMENT OF TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFFICE OF PIPELINE SAFETY WASHINGTON, D.C. 20590 __________________________________________ ) In the Matter of ) ) Devon Energy Corporation, ) CPF No. 5-2019-6001M d/b/a Devon Energy Production Company, LP, ) ) Respondent. ) __________________________________________) ORDER DIRECTING AMENDMENT From July 30 to August 2, 2018, 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 written operator qualification (OQ) program of Devon Energy Corporation (Devon or Respondent), a subsidiary of Devon Energy Production Company, LP in Oklahoma City, Oklahoma. Devon is an independent oil and natural gas exploration and production company, with operations focused onshore in the United States. The company operates CO2 pipelines and also produces approximately 140,000 barrels of oil, 575 million cubic feet of natural gas and 80,000 barrels of natural gas liquids per day.1 As a result of the inspection, the Director, Western Region, OPS (Director), issued to Respondent, by letter dated January 10, 2019, a Notice of Amendment (Notice). In accordance with 49 C.F.R. § 190.206, the Notice alleged certain inadequacies in Respondent’s OQ program and proposed requiring Devon to amend its procedures to ensure safe operation of its pipeline facilities. After requesting and receiving an extension of time to respond, Devon responded to the Notice by letter dated February 6, 2019 (Response). The company contested the allegations of inadequacy, provided a summary of its position, and included information concerning changes that it had made to its procedures. Respondent did not request a hearing and therefore has waived its right to one. 1 Devon Energy Production Company, LP website, available at https://www.devonenergy.com/about-us (last accessed February 12, 2020).#

520196001M_Order Directing Amendment_04062020_text.pdf, page 3CPF No. 5-2019-6001M Page 2 FINDINGS OF INADEQUATE PROCEDURES Item 1: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 195.505(b), which states in relevant part: § 195.505 Qualification program. Each operator shall have and follow a written qualification program. The program shall include provisions to: (a) ... (b) Ensure through evaluation that individuals performing covered tasks are qualified; .... The Notice alleged that Respondent’s OQ Program had inadequate qualification methods used to ensure that the individuals performing covered tasks remained qualified to perform those tasks. Specifically, the Notice alleged that the program did not differentiate between methods used for initial qualification versus methods used for requalification. The Notice also alleged that Devon’s OQ Program did not specify standards for testing or performance evaluations, and that the evaluation methods did not provide adequate criteria for evaluators to use to objectively verify individual employees’ knowledge, skills, and abilities. For example, the Notice alleged Devon’s methods for conducting testing did not ensure that qualified employees demonstrated knowledge of its operations and maintenance procedures. In its Response, Devon stated that its OQ Program included adequate qualification methods to ensure that the individuals performing covered tasks remained qualified to perform those tasks. It explained that Section 5 of its OQ Program provides procedures for its qualification process. It stated that it does not differentiate between evaluation methods for initial and requalification because the methods are the same. Section 5.1 of its OQ plan states that “all evaluations ... shall be conducted in accordance with Veriforce Operator Qualification Personnel Evaluation Policies and Procedures” (included in Appendix 6 of its plan). Devon noted that it has incorporated Veriforce’s (a third party) Covered Task Evaluation Criteria, referenced in Appendix 5 of the Program, to ensure each evaluator objectively verifies an individual’s knowledge, skills, and abilities for each Covered Task for both initial and subsequent requalifications. Devon also included an excerpt from its Evaluation Criteria, Form for CT 007 - Operate Valves. This form requires the evaluator to evaluate the individual’s knowledge of “operator-approved procedures” (i.e. Devon's applicable operation and maintenance (O&M) procedures) as part of the evaluation process. I have reviewed Devon’s procedures and for the following reasons find them inadequate. While the procedures include statements regarding requirements to be qualified and how to obtain knowledge and skills, there is not enough detail for individuals and evaluators to understand the methods that will be used to ensure individuals remain qualified. Specifically, Devon must clarify in the program if the methods used for initial qualification and methods used for requalification are the same. Likewise, though Appendix 5 directs the reader to the Veriforce website to obtain current evaluation criteria, the Appendix fails to provide a link to the website. Devon must amend its procedures to either include the correct web address needed to access the#

520196001M_Order Directing Amendment_04062020_text.pdf, page 4CPF No. 5-2019-6001M Page 3 evaluation criteria or list the criteria directly into its procedures. Listing the criteria in the procedures themselves provides the advantage of ensuring that the information is available in the event that the website is unavailable or that criteria are added without Devon’s knowledge or approval. Also, if the website changes, the procedures must be updated accordingly. Devon relies on Veriforce’s Covered Task Evaluation Criteria, but the attached form is not tailored to Devon’s system. Devon may rely on an “off-the-shelf” OQ Program, but must ensure that the program addresses the specific aspects of its own facility. For example, on the Form for CT 007 - Operate Valves, one question asks an individual to identify the most common types of pipeline valves. Identifying types of common valves, however, might be irrelevant if the operator only has ball valves. Performing an inspection on a ball valve might be different than performing an inspection on a gate valve. This question fails to critically evaluate whether the individual has the specific knowledge necessary to perform valve operations on Devon’s system pursuant to Devon's written procedures. The following are other examples of how the procedures do not adequately provide criteria for evaluators to use to objectively verify individual employees' knowledge, skills, and abilities. It is unclear how an evaluator knows whether a test taker has “passed” the oral and action aspects of the examination. Devon’s procedures do not provide criteria that ensure that internal evaluators are uniformly and objectively assessing candidates during these evaluations. Without such criteria, Devon cannot be certain that qualifications are uniform, since what one evaluator finds sufficient might be rejected by another evaluator. This could lead to differences in the minimum levels of skills and knowledge among Devon’s workforce. Veriforce’s generic evaluation criteria are insufficient to determine if an individual is qualified to perform covered tasks on Devon’s pipeline facility. Devon may rely on Verifore’s evaluation criteria, but must also include questions and skill tests tailored specifically to Devon’s unique system and procedural requirements. It should also include specific information on how to score results to promote uniformity and objective administration of the exams. Accordingly, I find that Devon’s procedures were inadequate to ensure safe operation of its pipeline system. Pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.206, Devon is ordered to make revisions to its procedures to address the adequacies. Item 2: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 195.505(c), which states in relevant part: § 195.505 Qualification program. Each operator shall have and follow a written qualification program. The program shall include provisions to: (a) ... (c) Allow individuals that are not qualified pursuant to this subpart to perform a covered task if directed and observed by an individual that is qualified; ... The Notice alleged that Devon’s written OQ Program did not have an adequate procedure to#

520196001M_Order Directing Amendment_04062020_text.pdf, page 5CPF No. 5-2019-6001M Page 4 safely allow non-qualified individuals performing a covered task to be directed by a qualified individual. Specifically, the Notice alleged that the procedures did not adequately address key factors for span of control such as physical distance and communication barriers including noise levels and language comprehension. In its Response, Devon stated that Section 7 of its OQ Program includes adequate procedures to safely allow non-qualified individuals to be directed by a qualified individual. It also stated that key factors for span of control are addressed in sections 7.1 and 7.3 of the Devon OQ Program. In Section 7, the program requires that “individuals who are not qualified to perform a task may perform a task if under the direct supervision of a qualified individual. Direct supervision includes the ability to clearly observe the non-qualified individual’s activities and to take immediate corrective actions when necessary.” In Section 7.1, the program states that a qualified person directing and observing the non-qualified person must be able to intervene to either prevent or react to an abnormal operating condition (AOC). Devon’s span of control requirements includes ensuring that no language barriers exist to preclude communications, the qualified personnel must be in a position where they can direct and observe performance, and intervene if necessary, and only one covered task can be directed and observed at a time. Devon admitted that its procedures do not include provisions to address noise levels, but claimed that noise levels are understood to be included in the provisions regarding language barriers. I find that Devon’s procedures are sufficient regarding physical proximity. While the procedures do not specify a physical distance for observation, they do require that the qualified personnel be able to intervene if necessary. Because they must be standing close enough to the unqualified personnel to be able to intervene, requiring a specific physical proximity is unnecessary. I do find, however, that Devon’s span of control procedures are insufficient in one respect. Devon’s span of control requirements do not address noise levels. The language of its procedures specifically references “language barriers,” therefore it is unclear to the reader that noise levels are meant to be inferred into these requirements. Devon must amend its procedures to specifically address noise levels. Accordingly, I find that Devon’s procedures were inadequate to ensure safe operation of its pipeline system. Pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.206, Devon is ordered to make the above revisions to its procedures. Item 3: The Notice alleged that Respondent’s procedures were inadequate with regard to 49 C.F.R. § 195.505(g), which states in relevant part: § 195.505 Qualification program. Each operator shall have and follow a written qualification program. The program shall include provisions to: (a) ... (g) Identify those covered tasks and the intervals at which evaluation of the individual's qualifications is needed; ... The Notice alleged that Devon’s written OQ Program did not have an adequate process or#

520196001M_Order Directing Amendment_04062020_text.pdf, page 6CPF No. 5-2019-6001M Page 5 procedure to establish and justify reevaluation intervals, but rather uses an across-the board application of extended reevaluation intervals with no documented justification or basis for that time interval. Specifically, the Notice alleged Devon’s OQ Program did not consider the complexity of the task, the critical nature of the task, or the frequency of task performance (DIF analysis) when establishing reevaluation intervals. The Notice also alleged that Devon’s Program did not identify a minimum time frame for reevaluation upon failure of evaluation for a covered task, nor did it establish how many times an individual would be allowed to attempt the requalification process before the qualification is revoked. In its Response, Devon stated that the NOA was inaccurate in claiming that it uses across the board reevaluation intervals. It states that while many common covered tasks have 3-year intervals, complex tasks have a shorter reevaluation interval based on task complexity, critical nature, and frequency of performance. Devon explained that its Devon Pipeline Governance Committee (PGC) reviewed and adopted Veriforce’s common covered task list (CCTL) and associated evaluation criteria, which were created by comparing and reconciling the existing covered task lists and criteria each client had developed/adopted. Subject matter experts utilized data from their respective individual plans to decide on evaluation method, evaluation criteria, span of control, and requalification intervals for each of the common covered tasks. According to Respondent, Veriforce established and facilitates the CCTL Steering Committee which reviews the adequacy of the CCTL (and underlying task evaluation criteria) on an ongoing basis, as well as potential changes to the CCTL based on things such as stakeholder feedback and regulatory changes. The CCTL steering committee makes recommendations to the larger group of operators who have adopted the CCTL. Devon’s PGC considered this process within its overall evaluation of the Veriforce program, favoring a process that included input and experiences from multiple pipeline operators across the county. In addition, Devon’s PGC includes the appropriateness/effectiveness of task-specific span of control limits during its annual program evaluation. Finally, with regard to identifying a minimum time frame for reevaluation upon failure of evaluation for a covered task and establishing how many times an individual would be allowed to attempt requalification process before the qualification is revoked, Devon noted that its evaluation process specifically states that an individual is deemed “unqualified” in the event of an unsuccessful evaluation per Section 6.10.3 of Veriforce’s Policies and Procedures. In addition, Section 8 of Devon’s OQ program requires training for any individual failing any evaluation prior to any subsequent evaluation attempts. This training must be verified and documented prior to revaluation. Having considered the evidence in the record, I find that Devon’s procedures establishing and justifying reevaluation intervals are insufficient. Devon relies on Veriforce’s criteria which are not tailored to Devon’s specific system, but are created based on a wide pool of operators. In order to be effective, Devon’s procedures must be directly correlated to its own system. While Devon may have criteria for evaluating these intervals, it has not demonstrated that it actually applied that criteria rather than simply adopting Veriforce’s off-the-shelf OQ program. Veriforce must amend its procedures to provide clarity regarding how reevaluations are conducted and established in order to ensure uniformity. While Devon does have procedures in#

520196001M_Order Directing Amendment_04062020_text.pdf, page 7CPF No. 5-2019-6001M Page 6 place regarding its evaluation process, these procedures are inadequate because they do not further define a reevaluation period, but only require an employee to “successfully complete appropriate training before a subsequent evaluation is allowed” under Section 6.9.5. Details such as how many times an individual may be allowed to attempt the requalification process before the qualification is revoked would be helpful for ensuring each employee is properly qualified. It appears that Devon uses the same OQ Program for both its Part 192 and 195 facilities and has adopted Veriforce’s list of covered tasks. I recommend separating the covered tasks related to natural gas and hazardous liquids into their own lists to reduce confusion that may arise if an employee sees a task that does not apply to a certain facility. Accordingly, I find that Devon’s procedures were inadequate to ensure safe operation of its pipeline system. Pursuant to 49 U.S.C. § 60108(a) and 49 C.F.R. § 190.206, Devon is ordered to make the above revisions to its procedures. The Director may grant an extension of time to comply with any of the required items upon a written request timely submitted by the Respondent and demonstrating good cause for an extension. Failure to comply with this Order may result in administrative assessment of civil penalties not to exceed $213,268, 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. 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 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 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. April 6, 2020 ___________________________________ ______________________ Alan K. Mayberry Date Issued Associate Administrator for Pipeline Safety#

520196001M_Closure Letter_10132020_text.pdf, page 1Official PDFVIA E-MAIL TO MR. DAVE HAGER October 13, 2020 Mr. Dave Hager President and Chief Executive Officer Devon Energy Corporation dba Devon Energy Production Company, LP 333 West Sheridan Avenue Oklahoma City, Oklahoma 73102 CPF 5-2019-6001M Closure Letter Dear Mr. Hager: From July 30 to August 2, 2018, a representative from the Pipeline and Hazardous Materials Safety Administration (PHMSA), pursuant to chapter 601 of 49 United States Code, conducted an on-site pipeline safety inspection of Devon Energy’s procedures in Oklahoma City, Oklahoma. As a result of the inspection, Devon Energy was issued a Notice of Amendment on January 10, 2019, which proposed amendment of your procedures. After requesting and receiving an extension of time to respond, Devon responded to the Notice by letter dated February 6, 2019. The company contested the allegations of inadequacy, provided a summary of its position, and included information concerning changes that it had made to its procedures. Respondent did not request a hearing and therefore has waived its right to one. On April 6, 2020, an Order Directing Amendment was issued by PHMSA. Devon Energy submitted a response to its amended procedures on June 3, 2020. My staff has reviewed the amended procedures, and it appears that the inadequacies outlined in this Notice of Amendment have been corrected. This letter is to inform you no further action is necessary and this case is now closed. Thank you#

520196001M_Closure Letter_10132020_text.pdf, page 2for your cooperation. Sincerely, Dustin Hubbard Director, Western Region Pipeline and Hazardous Materials Safety Administration cc: PHP-60 Compliance Registry PHP-500 D. Fehling (#160423)#