{"operation":"document","citation":"CPF 520197002","title":"CAELUS NATURAL RESOURCES ALASKA, LLC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2019-01-21","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.260(e), 195.412(a), 195.428(a), 195.440(c), 195.452(b)(1), 195.452(b)(2), 195.452(j)(1), 195.583(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520197002.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520197002.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520197002","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520197002","body":"Notice of Probable Violation involving CAELUS NATURAL RESOURCES ALASKA, LLC. PHMSA's enforcement data identifies the cited regulations as 195.260(e),  195.412(a),  195.428(a),  195.440(c),  195.452(b)(1),  195.452(b)(2),  195.452(j)(1),  195.583(a). The case was opened on 2019-01-21 and is reported as closed as of 2020-07-23. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520197002_Closure Letter_07232020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520197002/520197002_Closure%20Letter_07232020.pdf\n\n520197002_Closure Letter_07232020_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520197002/520197002_Closure%20Letter_07232020_text.pdf\n\n520197002_Final Order_07232019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520197002/520197002_Final%20Order_07232019.pdf\n\n520197002_Final Order_07232019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520197002/520197002_Final%20Order_07232019_text.pdf\n\n520197002_NOPV PCO_01212019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520197002/520197002_NOPV%20PCO_01212019.pdf\n\n520197002_NOPV PCO_01212019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520197002/520197002_NOPV%20PCO_01212019_text.pdf\n\n520197002_Operator Response to Notice and Request for Time Extension_02202019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520197002/520197002_Operator%20Response%20to%20Notice%20and%20Request%20for%20Time%20Extension_02202019.pdf\n\n520197002_Closure Letter_07232020_text.pdf\n\nVIA E-MAIL TO MR. LUCA PELLICCIOTTA\nJuly 23, 2020\nMr. Luca Pellicciotta\nVice President, Technical Services\nEni US Operating Co. Inc.\n1200 Smith Street, Suite 1700\nHouston, TX 77002\nCPF 5-2019-7002\nClosure Letter\nDear Mr. Pellicciotta:\nOn July 23, 2019, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued to\nCaelus Natural Resources Alaska, LLC (Caelus), the operator at that time of the Oooguruk diesel\npipeline, a Final Order in the above-referenced case. This Order included a Compliance Order. Caelus\nhad previously provided documentation to PHMSA showing that they completed the first action of the\nCompliance Order.\nEni US Operating Co., Inc. (Eni), as the current operator of the Oooguruk diesel pipeline, provided to\nPHMSA documentation of their June 2020 integrity assessments of the Oooguruk diesel pipeline, which\nwas the second action of the Compliance Order. Based on our review of the documentation provided by\nEni, PHMSA determined that Eni complied with the actions of the Compliance Order. Accordingly, this\ncase is now closed and no further action is contemplated with respect to matters involved in this case.\nThank you for your cooperation in this matter.\nSincerely,\nDustin Hubbard\nDirector, Western Region\nPipeline and Hazardous Materials Safety Administration\ncc: PHP-60 Compliance Registry\nPHP-500 J. Gano (#158101)\nMr. Larry Burgess, Eni US Operating Co.\nMr. Rich Vicente, Eni US Operating Co.\nMr. Martin Slade, Eni US Operating Co.\n\n520197002_Final Order_07232019_text.pdf\n\nJuly 23, 2019\nMr. Jim Musselman\nPresident and Chief Executive Officer\nCaelus Natural Resources Alaska, LLC\n3700 Centerpoint Drive, Suite 500\nAnchorage, Alaska 99503\nRe: CPF No. 5-2019-7002\nDear Mr. Musselman:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation and specifies actions that need to be taken by Caelus Natural Resources Alaska, LLC,\nto comply with the pipeline safety regulations. When the terms of the compliance order have\nbeen completed, as determined by the Director, Western Region, this enforcement action will be\nclosed. Service of the Final Order by certified mail is effective upon the date of mailing, as\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\ncc: Mr. Dustin Hubbard, Director, Western Region, Office of Pipeline Safety, PHMSA\nMs. Erin D. Renfro, Operations Engineering Supervisor, Caelus Natural Resources\nAlaska, LLC\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\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 )\nCaelus Natural Resources Alaska, LLC, ) )\n)\n)\nRespondent. )\n____________________________________)\nCPF No. 5-2019-7002\nFINAL ORDER\nFrom April 9 through April 20, 2018, pursuant to 49 U.S.C. § 60117, representatives of the\nPipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety\n(OPS), conducted an on-site pipeline safety inspection of the facilities and records of Caelus\nNatural Resources Alaska, LLC’s (Caelus or Respondent) 2-inch diesel and base oil pipeline (the\n“diesel pipeline”) that services the Oooguruk oil field located on the Alaska North Slope. The\nassociated pipeline operations and maintenance procedures and records were reviewed in\nAnchorage, Alaska.\nAs a result of the inspection, the Director, Western Region, OPS (Director), issued to\nRespondent, by letter dated January 21, 2019, a Notice of Probable Violation and Proposed\nCompliance Order (Notice), which also included warnings pursuant to 49 C.F.R. § 190.205. In\naccordance with 49 C.F.R. § 190.207, the Notice proposed finding that Caelus had committed\neight violations of 49 C.F.R. Part 195 and proposed ordering Respondent to take certain\nmeasures to correct the alleged violations. The warning items required no further action, but\nwarned Caelus to correct the probable violations or face possible future enforcement action.\nCaelus responded to the Notice by letter dated February 20, 2019 (Response). The company did\nnot contest the allegations of violation and agreed to complete the proposed compliance actions.\nRespondent requested additional time to submit one element of a proposed compliance action.\nRespondent did not request a hearing and therefore has waived its right to one.\nFINDINGS OF VIOLATION\nIn its Response, Caelus did not contest the allegations in the Notice that it violated 49 C.F.R. Part\n195, as follows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.260(e), which states:\n\n\n\nCPF No. 5-2019-7002\nPage 2\n§ 195.260 Valves: Location.\nA valve must be installed at each of the following locations:\n(a) . . . .\n(e) On each side of a water crossing that is more than 100 feet (30\nmeters) wide from high-water mark to high-water mark unless the\nAdministrator finds in a particular case that valves are not justified.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.260(e) by failing to install a valve\non each side of a water crossing greater than 100 feet wide. Specifically, the Notice alleged that\nthe underwater portion of the diesel pipeline that traverses the Beaufort Sea between the\nmainland and an offshore artificial drilling island is approximately 5.7 miles. Although there are\nshutoff valves located at the artificial drilling island side of the water crossing, the pipeline does\nnot have the required shutoff valve at the mainland side of the water crossing. The nearest valve\nto the mainland side of the water crossing is at the pumping and pigging module at the upstream\nend of the diesel pipeline, which is approximately 2.3 miles from the water.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.260(e) by failing to install a\nvalve on each side of a water crossing greater than 100 feet wide.\nItem 7: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(j)(1), which states:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) . . . .\n(j) What is a continual process of evaluation and assessment to\nmaintain a pipeline's integrity?\n(1) General. After completing the baseline integrity assessment, an\noperator must continue to assess the line pipe at specified intervals and\nperiodically evaluate the integrity of each pipeline segment that could affect\na high consequence area.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.452(j)(1) by failing to continue to\nassess its line pipe at specified intervals and periodically evaluate the integrity of each pipeline\nsegment that could affect a high consequence area after completing the baseline integrity\nassessment. Specifically, the Notice alleged that the diesel pipeline’s baseline assessment was\nconducted in 2007, and that Caelus had not completed an integrity reassessment of the line pipe\nsince that time. Under 49 C.F.R. § 195.452(j)(3), the assessment interval must not exceed 5\nyears or 68 months. Caelus was also utilizing a leak detection test that was not an allowable\nintegrity assessment method.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.452(j)(1) by failing to continue\nto assess the line pipe at specified intervals and periodically evaluate the integrity of each\npipeline segment that could affect a high consequence area after completing the baseline\nintegrity assessment.\n\n\n\nCPF No. 5-2019-7002\nPage 3\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nWARNING ITEMS\nWith respect to Items 2, 3, 4, 5, 6, and 8, the Notice alleged probable violations of Part 195 but\ndid not propose a civil penalty or compliance order for these items. Therefore, these are\nconsidered to be warning items. The warnings were for:\n49 C.F.R. § 195.412(a) (Item 2) ─ Respondent’s alleged failure to inspect the\nsurface conditions on or adjacent to the diesel pipeline at intervals not exceeding\n3 weeks, but at least 26 times each calendar year;\n49 C.F.R. § 195.428(a) (Item 3) ─ Respondent’s alleged failure to test each\noverpressure safety device on the diesel pipeline at least once each calendar year,\nwith intervals not to exceed 15 months;\n49 C.F.R. § 195.440(c) (Item 4) ─ Respondent’s alleged failure to review its\nPublic Awareness Plan on an annual basis consistent with API RP 1162;\n49 C.F.R. § 195.452(b)(1) (Item 5) ─ Respondent’s alleged failure to develop a\nwritten integrity management program that addresses the risks on each segment of\npipeline within one year after the date the pipeline began operation;\n49 C.F.R. § 195.452(b)(2) (Item 6) ─ Respondent’s alleged failure to identify\neach pipeline or pipeline segment covered by § 195.452 within the required\ntimeframe; and\n49 C.F.R. § 195.483(a) (Item 8) ─ Respondent’s alleged failure to conduct\natmospheric corrosion inspections on the diesel pipeline at the required inspection\nintervals.\nCaelus presented information in its Response showing that it will take certain actions to address\nthe cited items. If OPS finds a violation of any of these items in a subsequent inspection,\nRespondent may be subject to future enforcement action.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Items 1 and 7 in the Notice for\nviolations of 49 C.F.R. §§ 195.260(e) and 195.452(j)(1), respectively. Under 49 U.S.C.\n§ 60118(a), each person who engages in the transportation of hazardous liquids or who owns or\noperates a pipeline facility is required to comply with the applicable safety standards established\nunder chapter 601. Pursuant to the authority of 49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217,\nRespondent is ordered to take the following actions to ensure compliance with the pipeline safety\n\n\n\nCPF No. 5-2019-7002\nPage 4\nregulations applicable to its operations:\n1. With respect to the violation of § 195.260(e) (Item 1), Respondent must install a\nshutdown valve on the main land side of the Beaufort Sea water crossing. The\nlocation of the valve must be as near as practicable to the shore. The valve selected\nmust comply with § 195.116 and be consistent with Caelus’s Excess Flow Restricting\nDevice study required by § 195.452(i). Caelus must install the valve within 180 days\nafter the receipt of the Final Order, and must provide documentation that this has\nbeen completed to the Director within 30 days of the installation.\n2. With respect to the violation of § 195.452(j)(1) (Item 7), Respondent must:\na. Prepare a written plan for conducting an integrity assessment consistent with\n§ 195.452(i)(l). If a pressure test is the selected assessment method, the written\nplan must be consistent with Subpart E of 49 C.F.R. Part 195. Caelus must\nsubmit its written integrity assessment plan to the Director within 90 days after\nthe receipt of the Final Order.\nb. Implement an integrity assessment in accordance with Item 2(a). Caelus must\ncomplete the integrity assessment under Item 2(b), and submit the results of the\nintegrity assessment to the Director within one year of the receipt of the Final\nOrder.\nThe Director may grant an extension of time to comply with any of the required items upon a\nwritten request timely submitted by the Respondent and demonstrating good cause for an\nextension.\nIt is requested (not mandated) that Respondent maintain documentation of the safety\nimprovement costs associated with fulfilling this Compliance Order and submit the total to the\nDirector. It is requested that these costs be reported in two categories: (1) total cost associated\nwith preparation/revision of plans, procedures, studies and analyses; and (2) total cost associated\nwith replacements, additions and other changes to pipeline infrastructure.\nFailure to comply with this Order may result in the administrative assessment of civil penalties\nnot to exceed $200,000, as adjusted for inflation (49 C.F.R. § 190.223), for each violation for\neach day the violation continues or in referral to the Attorney General for appropriate relief in a\ndistrict court of the United States.\nUnder 49 C.F.R. § 190.243, Respondent may submit a Petition for Reconsideration of this Final\nOrder to the Associate Administrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey\nAvenue, SE, East Building, 2nd Floor, Washington, DC 20590, with a copy sent to the Office of\nChief Counsel, PHMSA, at the same address, no later than 20 days after receipt of service of this\nFinal Order by Respondent. Any petition submitted must contain a statement of the issue(s) and\nmeet all other requirements of 49 C.F.R. § 190.243. The terms of the order, including corrective\naction, remain in effect unless the Associate Administrator, upon request, grants a stay.\n\n\n\nCPF No. 5-2019-7002\nPage 5\nThe terms and conditions of this Final Order are effective upon service in accordance with 49\nC.F.R. § 190.5.\nJuly 23, 2019\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":14841}