{"operation":"document","citation":"CPF 52021032WL","title":"NAVAJO NATION OIL AND GAS COMPANY — Warning Letter","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2021-06-23","effective_on":null,"summary":"CLOSED warning letter citing 199.105(c)(6), 199.113(c), 199.119(a), 199.241, 40.11(b).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-52021032wl.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-52021032wl.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-52021032wl","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/52021032WL","body":"Warning Letter involving NAVAJO NATION OIL AND GAS COMPANY. PHMSA's enforcement data identifies the cited regulations as 199.105(c)(6),  199.113(c),  199.119(a),  199.241,  40.11(b). The case was opened on 2021-06-23 and is reported as closed as of 2021-06-23. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n52021032WL_Warning Letter_06232021_(21-203352) .pdf: https://primis.phmsa.dot.gov/enforcement-documents/52021032WL/52021032WL_Warning%20Letter_06232021_(21-203352)%20.pdf\n\n52021032WL_Warning Letter_06232021_(21-203352)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/52021032WL/52021032WL_Warning%20Letter_06232021_(21-203352)_text.pdf\n\n52021032WL_Warning Letter_06232021_(21-203352)_text.pdf\n\nWARNING LETTER\nVIA E-MAIL TO MR. JAMES R. MCCLURE\nJune 23, 2021\nMr. James R. McClure\nPresident\nNavajo Oil and Gas Company\n50 Narbono Circle West\nSt. Michaels, AZ 86511\nCPF 5-2021-032-WL\nDear McClure:\nFrom March 4, 2021 to May 18, 2021, representatives of the Pipeline and Hazardous Materials\nSafety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code (U.S.C.),\ninspected Navajo Nation Gas and Oil Company (NNGOC) PHMSA Drug and Alcohol (D&A)\nprogram by virtual and other electronic means.\nAs a result of the inspection, it is alleged that NNGOC has committed probable violations of the\nPipeline Safety Regulations, Title 49, Code of Federal Regulations (CFR). The items inspected\nand the probable violations are as follows:\n1. § 40.11 What are the general responsibilities of employers under this regulation?\n...\n(b) You are responsible for all actions of your officials, representatives, and agents\n(including service agents) in carrying out the requirements of the DOT agency\nregulations.\nNNOGC was not responsible for all actions of its officials, representatives, and agents (including\nservice agents) in carrying out the requirements of the DOT agency regulations. NNOGC\ndelegated some of its D&A program functions to its service agent; the Reliance Medical Group\n\n\n\n(RMG). During the inspection of the NNOGC random drug testing program, PHMSA received\nseveral emails from the NNOGC Designated Employer Representative (DER) which stated that\nNNOGC refused to accept the responsibility for the failure of RMG to complete the drug testing\nof several of the employees selected for random drug testing.\n2. §199.119 Reporting of anti-drug testing results.\n(a) Each large operator (having more than 50 covered employees) must submit\nan annual Management Information System (MIS) report to PHMSA of its anti-\ndrug testing using the MIS form and instructions as required by 49 CFR part 40 (at\n§40.26 and appendix H to part 40), not later than March 15 of each year for the\nprior calendar year (January 1 through December 31). The Administrator may\nrequire by notice in the PHMSA Portal\n(https://portal.phmsa.dot.gov/phmsaportallanding) that small operators (50 or fewer\ncovered employees), not otherwise required to submit annual MIS reports, to\nprepare and submit such reports to PHMSA.\nNNOGC, a small operator, did not correctly prepare and submit the required annual MIS report\nto PHMSA after having been required by the Administrator to submit a report for calendar year\n2019.\nWhile NNOGC submitted an annual MIS report for calendar year 2019 to PHMSA, it did not\ninclude any random drug test information.\n3. §199.113 Employee assistance program.\n...\n(c) Training under each EAP for supervisory personnel who will determine whether\nan employee must be drug tested based on reasonable cause must include one 60-\nminute period of training on the specific, contemporaneous physical, behavioral,\nand performance indicators of probable drug use.\nThe NNOGC EAP did not include one 60-minute period of training on the specific,\ncontemporaneous physical, behavioral, and performance indicators of probable drug use for its\nsupervisory personnel who will determine whether an employee must be drug tested based on\nreasonable cause.\nDuring the inspection, PHMSA asked for records of this required supervisor training. The\nNNGOC DER replied via return email that NNGOC did not have any training records because\nthe training had not been completed.\n4. §199.241 Training for supervisors.\nEach operator shall ensure that persons designated to determine whether\nreasonable suspicion exists to require a covered employee to undergo alcohol testing\nunder §199.225(b) receive at least 60 minutes of training on the physical, behavioral,\n2\n\n\n\nspeech, and performance indicators of probable alcohol misuse.\nNNOGC did not ensure that persons designated to determine whether reasonable suspicion exists\nto require a covered employee to undergo alcohol testing under §199.225(b) received at least 60\nminutes of training on the physical, behavioral, speech, and performance indicators of probable\nalcohol misuse.\nDuring the inspection, PHMSA asked for records of this required supervisor training. The\nNNGOC DER replied via return email that NNGOC did not have any training records because\nthe training had not been completed.\n5. §199.105 Drug tests required.\n…\n(c)\n...\n(6) The operator shall randomly select a sufficient number of covered employees for\ntesting during each calendar year to equal an annual rate not less than the\nminimum annual percentage rate for random drug testing determined by the\nAdministrator. If the operator conducts random drug testing through a consortium,\nthe number of employees to be tested may be calculated for each individual operator\nor may be based on the total number of covered employees covered by the\nconsortium who are subject to random drug testing at the same minimum annual\npercentage rate under this subpart or any DOT drug testing rule.\nNNGOC failed to randomly select a sufficient number of covered employees for testing during\neach calendar year to equal an annual rate not less than the minimum annual percentage rate for\nrandom drug testing determined by the Administrator.\nNNGOC conducts random drug testing through a consortium. In calendar year 2020, NNGOC’s\nconsortium failed to meet the minimum random drug test rate of 50 percent. The consortium\nselected only three employees for random drug tests; and, of those three, only one was tested for\ndrugs, which is an annual rate of only 10 percent.\nUnder 49 U.S.C. § 60122 and 49 CFR § 190.223, you are subject to a civil penalty not to exceed\n$225,134 per violation per day the violation persists, up to a maximum of $2,251,334 for a\nrelated series of violations. For violation occurring on or after January 11, 2021 and before May\n3, 2021, the maximum penalty may not exceed $222,504 per violation per day the violation\npersists, up to a maximum of $2,225,034 for a related series of violations. For violation\noccurring on or after July 31, 2019 and before January 11, 2021, the maximum penalty may not\nexceed $218,647 per violation per day the violation persists, up to a maximum of $2,186,465 for\na related series of violations. For violation occurring on or after November 27, 2018 and before\nJuly 31, 2019, the maximum penalty may not exceed $213,268 per violation per day, with a\nmaximum penalty not to exceed $2,132,679. For violation occurring on or after November 2,\n2015 and before November 27, 2018, the maximum penalty may not exceed $209,002 per\n3\n\n\n\nviolation per day, with a maximum penalty not to exceed $2,090,022.\nWe have reviewed the circumstances and supporting documents involved in this case, and have\ndecided not to conduct additional enforcement action or penalty assessment proceedings at this\ntime. We advise you to correct the items identified in this letter. Failure to do so will result in\nNNGOC being subject to additional enforcement action.\nNo reply to this letter is required. If you choose to reply, in your correspondence please refer to\nCPF 5-2021-032-WL. Be advised that all material you submit in response to this enforcement\naction is subject to being made publicly available. If you believe that any portion of your\nresponsive material qualifies for confidential treatment under 5 U.S.C. 552(b), along with the\ncomplete original document you must provide a second copy of the document with the portions\nyou believe qualify for confidential treatment redacted and an explanation of why you believe\nthe redacted information qualifies for confidential treatment under 5 U.S.C. 552(b).\nSincerely,\nDustin Hubbard\nDirector, Western Region, Office of Pipeline Safety\nPipeline and Hazardous Materials Safety Administration\ncc: PHP-60 Compliance Registry\n4\n\n52021032WL_Warning Letter_06232021_(21-203352) .pdf\n\nU.S. Department\nof Transportation\nPipeline and Hazardous\nMaterials Safety\nAdministration\n12300 W. Dakota Ave., Suite 110\nLakewood, CO 80228\nWARNING LETTER\nVIA E-MAIL TO MR. JAMES R. MCCLURE\nJune 23, 2021\nMr. James R. McClure\nPresident\nNavajo Oil and Gas Company\n50 Narbono Circle West\nSt. Michaels, AZ 86511\nCPF 5-2021-032-WL\nDear Mr. McClure:\nFrom March 4, 2021 to May 18, 2021, representatives of the Pipeline and Hazardous Materials\nSafety Administration (PHMSA), pursuant to Chapter 601 of 49 United States Code (U.S.C.),\ninspected Navajo Nation Gas and Oil Company (NNGOC) PHMSA Drug and Alcohol (D&A)\nprogram by virtual and other electronic means.\nAs a result of the inspection, it is alleged that NNGOC has committed probable violations of the\nPipeline Safety Regulations, Title 49, Code of Federal Regulations (CFR). The items inspected\nand the probable violations are as follows:\n1. § 40.11 What are the general responsibilities of employers under this regulation?\n...\n(b) You are responsible for all actions of your officials, representatives, and agents\n(including service agents) in carrying out the requirements of the DOT agency\nregulations.\nNNOGC was not responsible for all actions of its officials, representatives, and agents (including\nservice agents) in carrying out the requirements of the DOT agency regulations. NNOGC\ndelegated some of its D&A program functions to its service agent; the Reliance Medical Group\n\n\n\n(RMG). During the inspection of the NNOGC random drug testing program, PHMSA received\nseveral emails from the NNOGC Designated Employer Representative (DER) which stated that\nNNOGC refused to accept the responsibility for the failure of RMG to complete the drug testing\nof several of the employees selected for random drug testing.\n2. §199.119 Reporting of anti-drug testing results.\n(a) Each large operator (having more than 50 covered employees) must submit\nan annual Management Information System (MIS) report to PHMSA of its anti-\ndrug testing using the MIS form and instructions as required by 49 CFR part 40 (at\n§40.26 and appendix H to part 40), not later than March 15 of each year for the\nprior calendar year (January 1 through December 31). The Administrator may\nrequire by notice in the PHMSA Portal\n(https://portal.phmsa.dot.gov/phmsaportallanding) that small operators (50 or fewer\ncovered employees), not otherwise required to submit annual MIS reports, to\nprepare and submit such reports to PHMSA.\nNNOGC, a small operator, did not correctly prepare and submit the required annual MIS report\nto PHMSA after having been required by the Administrator to submit a report for calendar year\n2019.\nWhile NNOGC submitted an annual MIS report for calendar year 2019 to PHMSA, it did not\ninclude any random drug test information.\n3. §199.113 Employee assistance program.\n...\n(c) Training under each EAP for supervisory personnel who will determine whether\nan employee must be drug tested based on reasonable cause must include one 60-\nminute period of training on the specific, contemporaneous physical, behavioral,\nand performance indicators of probable drug use.\nThe NNOGC EAP did not include one 60-minute period of training on the specific,\ncontemporaneous physical, behavioral, and performance indicators of probable drug use for its\nsupervisory personnel who will determine whether an employee must be drug tested based on\nreasonable cause.\nDuring the inspection, PHMSA asked for records of this required supervisor training. The\nNNGOC DER replied via return email that NNGOC did not have any training records because\nthe training had not been completed.\n4. §199.241 Training for supervisors.\nEach operator shall ensure that persons designated to determine whether\nreasonable suspicion exists to require a covered employee to undergo alcohol testing\nunder §199.225(b) receive at least 60 minutes of training on the physical, behavioral,\n2\n\n\n\nspeech, and performance indicators of probable alcohol misuse.\nNNOGC did not ensure that persons designated to determine whether reasonable suspicion exists\nto require a covered employee to undergo alcohol testing under §199.225(b) received at least 60\nminutes of training on the physical, behavioral, speech, and performance indicators of probable\nalcohol misuse.\nDuring the inspection, PHMSA asked for records of this required supervisor training. The\nNNGOC DER replied via return email that NNGOC did not have any training records because\nthe training had not been completed.\n5. §199.105 Drug tests required.\n…\n(c)\n...\n(6) The operator shall randomly select a sufficient number of covered employees for\ntesting during each calendar year to equal an annual rate not less than the\nminimum annual percentage rate for random drug testing determined by the\nAdministrator. If the operator conducts random drug testing through a consortium,\nthe number of employees to be tested may be calculated for each individual operator\nor may be based on the total number of covered employees covered by the\nconsortium who are subject to random drug testing at the same minimum annual\npercentage rate under this subpart or any DOT drug testing rule.\nNNGOC failed to randomly select a sufficient number of covered employees for testing during\neach calendar year to equal an annual rate not less than the minimum annual percentage rate for\nrandom drug testing determined by the Administrator.\nNNGOC conducts random drug testing through a consortium. In calendar year 2020, NNGOC’s\nconsortium failed to meet the minimum random drug test rate of 50 percent. The consortium\nselected only three employees for random drug tests; and, of those three, only one was tested for\ndrugs, which is an annual rate of only 10 percent.\nUnder 49 U.S.C. § 60122 and 49 CFR § 190.223, you are subject to a civil penalty not to exceed\n$225,134 per violation per day the violation persists, up to a maximum of $2,251,334 for a\nrelated series of violations. For violation occurring on or after January 11, 2021 and before May\n3, 2021, the maximum penalty may not exceed $222,504 per violation per day the violation\npersists, up to a maximum of $2,225,034 for a related series of violations. For violation\noccurring on or after July 31, 2019 and before January 11, 2021, the maximum penalty may not\nexceed $218,647 per violation per day the violation persists, up to a maximum of $2,186,465 for\na related series of violations. For violation occurring on or after November 27, 2018 and before\nJuly 31, 2019, the maximum penalty may not exceed $213,268 per violation per day, with a\nmaximum penalty not to exceed $2,132,679. For violation occurring on or after November 2,\n2015 and before November 27, 2018, the maximum penalty may not exceed $209,002 per\n3\n\n\n\nviolation per day, with a maximum penalty not to exceed $2,090,022.\nWe have reviewed the circumstances and supporting documents involved in this case, and have\ndecided not to conduct additional enforcement action or penalty assessment proceedings at this\ntime. We advise you to correct the items identified in this letter. Failure to do so will result in\nNNGOC being subject to additional enforcement action.\nNo reply to this letter is required. If you choose to reply, in your correspondence please refer to\nCPF 5-2021-032-WL. Be advised that all material you submit in response to this enforcement\naction is subject to being made publicly available. If you believe that any portion of your\nresponsive material qualifies for confidential treatment under 5 U.S.C. 552(b), along with the\ncomplete original document you must provide a second copy of the document with the portions\nyou believe qualify for confidential treatment redacted and an explanation of why you believe\nthe redacted information qualifies for confidential treatment under 5 U.S.C. 552(b).\nSincerely,\nDustin Hubbard\nDirector, Western Region, Office of Pipeline Safety\nPipeline and Hazardous Materials Safety Administration\ncc: PHP-60 Compliance Registry\n4","truncated":false,"body_characters":16555}