{"operation":"document","citation":"CPF 52023002NOPV","title":"MID-ALASKA PIPELINE, LLC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2023-02-06","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.452(h)(4)(i)(C), 195.579(c), 195.583(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-52023002nopv.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-52023002nopv.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-52023002nopv","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/52023002NOPV","body":"Notice of Probable Violation involving MID-ALASKA PIPELINE, LLC. PHMSA's enforcement data identifies the cited regulations as 195.452(h)(4)(i)(C),  195.579(c),  195.583(a). The case was opened on 2023-02-06 and is reported as closed as of 2023-05-11. Proposed civil penalty: $50,200. Assessed civil penalty: $50,200. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n52023002NOPV_Final Order_04262023_(22-239265).pdf: https://primis.phmsa.dot.gov/enforcement-documents/52023002NOPV/52023002NOPV_Final%20Order_04262023_(22-239265).pdf\n\n52023002NOPV_Final Order_04262023_(22-239265)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/52023002NOPV/52023002NOPV_Final%20Order_04262023_(22-239265)_text.pdf\n\n52023002NOPV_Operator Response to Notice_03032023_(22-239265).pdf: https://primis.phmsa.dot.gov/enforcement-documents/52023002NOPV/52023002NOPV_Operator%20Response%20to%20Notice_03032023_(22-239265).pdf\n\n52023002NOPV_PCP_02062023_(22-239265).pdf: https://primis.phmsa.dot.gov/enforcement-documents/52023002NOPV/52023002NOPV_PCP_02062023_(22-239265).pdf\n\n52023002NOPV_PCP_02062023_(22-239265)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/52023002NOPV/52023002NOPV_PCP_02062023_(22-239265)_text.pdf\n\n52023002NOPV_Final Order_04262023_(22-239265)_text.pdf\n\nApril 26, 2023\nVIA ELECTRONIC MAIL TO: wchristian@midalaska.com\nMr. Warren Christian\nPresident\nMid-Alaska Pipeline, LLC\n615 Bidwell Ave., Suite 100\nFairbanks, Alaska 99701\nRe: CPF No. 5-2023-002-NOPV\nDear Mr. Christian:\nEnclosed please find the Final Order issued in the above-referenced case. It makes a finding of\nviolation and assesses a civil penalty of $50,200. The penalty payment terms are set forth in the\nFinal Order. This enforcement action closes automatically upon receipt of payment. Service of\nthe Final Order by e-mail is effective upon the date of transmission and acknowledgement of\nreceipt as provided 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\nMr. Levi Frampton, Pipeline Director and Vice President, Mid-Alaska Pipeline, LLC,\nlframpton@midalaska.com\nCONFIRMATION OF 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 )\nMid-Alaska Pipeline, LLC, ) CPF No. 5-2023-002-NOPV\n)\n)\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nFrom September 12 through September 16, 2022, pursuant to 49 U.S.C. § 60117, a\nrepresentative of the Pipeline and Hazardous Materials Safety Administration (PHMSA), Office\nof Pipeline Safety (OPS), conducted an on-site pipeline safety inspection of the facilities and\nrecords of Mid-Alaska Pipeline, LLC (Mid-Alaska or Respondent) in North Pole and Fairbanks,\nAlaska. Mid-Alaska owns and operates a 2.3-mile buried pipeline system transporting crude oil.\nAs a result of the inspection, the Director, Western Region, OPS (Director), issued to\nRespondent, by letter dated February 6, 2023, a Notice of Probable Violation and Proposed Civil\nPenalty (Notice). In accordance with 49 C.F.R. § 190.207, the Notice proposed finding that\nMid-Alaska had violated 49 C.F.R. § 195.452(h)(4)(i)(C) and proposed assessing a civil penalty\nof $50,200 for the alleged violation. The Notice also included an additional two warning items\npursuant to 49 C.F.R. § 190.205, which warned the operator to correct the probable violations or\nface possible future enforcement action\nMid-Alaska responded to the Notice by letter dated March 3, 2023 (Response). Mid-Alaska\noffered additional information in response to the Notice and requested that the proposed civil\npenalty be reduced. Respondent did not request a hearing and therefore has waived its right to\none.\nFINDING OF VIOLATION\nThe Notice alleged that Respondent violated 49 C.F.R. Part 195, as follows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.452, which states:\n§ 195.452 Pipeline integrity management in high consequence areas.\n(a) ….\n(h) What actions must an operator take to address integrity issues? —\n\n\n\n(4) Special requirements for scheduling remediation —\n(i) Immediate repair conditions. An operator's evaluation and\nremediation schedule must provide for immediate repair conditions. To\nmaintain safety, an operator must temporarily reduce the operating pressure\nor shut down the pipeline until the operator completes the repair of these\nconditions. An operator must calculate the temporary reduction in operating\npressure using the formulas referenced in paragraph (h)(4)(i)(B) of this\nsection. If no suitable remaining strength calculation method can be\nidentified, an operator must implement a minimum 20 percent or greater\noperating pressure reduction, based on actual operating pressure for two\nmonths prior to the date of inspection, until the anomaly is repaired. An\noperator must treat the following conditions as immediate repair conditions:\n(C) A dent located on the top of the pipeline (above the 4 and 8 o'clock\npositions) that has any indication of metal loss, cracking or a stress riser.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.452(h)(4)(i)(C) by failing to reduce\npipeline operating pressure or shut down the pipeline after identifying an immediate repair\ncondition. Specifically, the Notice alleged that Mid-Alaska failed to implement a 20 percent or\ngreater operating pressure reduction until it repaired a one percent depth dent with metal loss\nwhich it detected on June 22, 2022. The Notice alleged that no operating pressure reduction\noccurred between the time of the discovery of the immediate repair condition on June 22 and the\ntime of repair on June 25, 2022.\nIn its Response, Mid-Alaska did not contest the proposed violation, but instead provided\ninformation that it argued warrants a reduction in the amount of the penalty associated with the\nItem.1 These arguments are summarized in the section below.\nAccordingly, after considering all of the evidence, I find that Respondent violated 49 C.F.R.\n§ 195.452(h)(4)(i)(C) by failing to reduce pipeline operating pressure or shut down the pipeline\nafter identifying an immediate repair condition.\nThis finding of violation will be considered a prior offense in any subsequent enforcement action\ntaken against Respondent.\nASSESSMENT OF PENALTY\nUnder 49 U.S.C. § 60122, Respondent is subject to an administrative civil penalty not to exceed\n$200,000 per violation for each day of the violation, up to a maximum of $2,000,000 for any\nrelated series of violations.2\nIn determining the amount of a civil penalty under 49 U.S.C. § 60122 and 49 C.F.R. § 190.225, I\nmust consider the following criteria: the nature, circumstances, and gravity of the violation,\n1 Response, at 1.\n2 These amounts are adjusted annually for inflation. See 49 C.F.R. § 190.223 for adjusted amounts.\n\n\n\nincluding adverse impact on the environment; the degree of Respondent’s culpability; the history\nof Respondent’s prior offenses; any effect that the penalty may have on its ability to continue\ndoing business; the good faith of Respondent in attempting to comply with the pipeline safety\nregulations; and self-disclosure or actions to correct a violation prior to discovery by PHMSA.\nIn addition, I may consider the economic benefit gained from the violation without any reduction\nbecause of subsequent damages, and such other matters as justice may require. The Notice\nproposed a total civil penalty of $50,200 for the violation cited above.\nItem 1: The Notice proposed a civil penalty of $50,200 for Respondent’s violation of 49 C.F.R.\n§ 195.452, for failing to reduce pipeline operating pressure or shut down the pipeline after\nidentifying an immediate repair condition. The Respondent makes multiple arguments for a\nreduction in the civil penalty amount under this item. First, Mid-Alaska stated that, based on its\ndiscussions with inspection consultants, it concluded that the one percent depth dent with metal\nloss was a “stable” construction defect.\n3 However, the opinion of the operator or its consultants\ndoes not modify the regulatory obligation to shut down or reduce the pressure in a pipeline upon\ndiscovery of an immediate repair condition. Latent defects nonetheless pose risks to the safe\noperation of pipelines. Second, Mid-Alaska noted that the pipeline was already operating at 50-\n60 percent of its Maximum Operating Pressure (MOP), implying that the risk posed by the defect\nwas low.\n4 However, § 195.452(h)(4)(i)(C) requires a 20 percent reduction in the actual operating\npressure, not the MOP. Third, Mid-Alaska argued that it was unable to shut down its system or\nimplement a pressure reduction without “significant disturbance” to its infrastructure and\noperations.\n5 However, the regulations are clear that pressure reductions and shutdowns are the\nrequired contingencies upon discovery of an immediate repair condition. If Mid-Alaska’s\nsystems are unable to withstand these contingency plans, it should modify its systems to include\nadequate pressure controls in case of future immediate repair conditions. After considering all of\nRespondent’s arguments, I do not find a basis for reducing the civil penalty as proposed.\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a civil penalty of $50,200 for violation of 49 C.F.R. § 195.452(h)(4)(i)(C).\nPayment of the civil penalty must be made within 20 days after receipt of this Final Order.\nFederal regulations (49 C.F.R. § 89.21(b)(3)) require such payment to be made by wire transfer\nthrough the Federal Reserve Communications System (Fedwire), to the account of the U.S.\nTreasury. Detailed instructions are contained in the enclosure. Questions concerning wire\ntransfers should be directed to: Financial Operations Division (AMK-325), Federal Aviation\nAdministration, Mike Monroney Aeronautical Center, 6500 S MacArthur Blvd, Oklahoma City,\nOklahoma 79169. The Financial Operations Division telephone number is (405) 954-8845.\nFailure to pay the civil penalty will result in accrual of interest at the current annual rate in\naccordance with 31 U.S.C. § 3717, 31 C.F.R. § 901.9 and 49 C.F.R. § 89.23. Pursuant to those\nsame authorities, a late penalty charge of six percent (6%) per annum will be charged if payment\nis not made within 110 days of service. Furthermore, failure to pay the civil penalty may result\n3 Response, at 2.\n4 Id, at 2.\n5 Id, at 2.\n\n\n\nin referral of the matter to the Attorney General for appropriate action in a district court of the\nUnited States.\nWARNING ITEMS\nWith respect to Items 2 and 3, the Notice alleged probable violations of Part 195, but identified\nthem as warning items pursuant to § 190.205. The warnings were for:\n49 C.F.R. § 195.579(c) (Item 2) ─ Respondent’s alleged failure to inspect the\ninternal surface of a pipe for evidence of corrosion upon removal from a pipeline;\nand\n49 C.F.R. § 195.583(a) (Item 3) ─ Respondent’s alleged failure to inspect the\nPetroStar Metering Inc. Station (PSIMS) portion of their pipeline system for\natmospheric corrosion at the required intervals.\nMid-Alaska requested withdrawal of Item 2, because it claims that the removed valves were\nvisually inspected and showed no evidence of an imminent hazard, requested withdrawal of Item\n3 because it claims that the inspection was not recorded due to a clerical error by a third-party\ncontractor, and presented information showing that it had taken certain actions to address the\ncited items. Under § 190.205, PHMSA does not adjudicate warning items to determine whether\na probable violation occurred. If OPS finds a violation of any of these items in a subsequent\ninspection, Respondent may be subject to future enforcement action.\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. The written petition must be received no later than\n20 days after receipt of the Final Order by Respondent. Any petition submitted must contain a\nbrief statement of the issue(s) and meet all other requirements of 49 C.F.R. § 190.243. The filing\nof a petition automatically stays the payment of any civil penalty assessed. The other terms of\nthe order, including any corrective action, remain in effect unless the Associate Administrator,\nupon request, grants a stay. If Respondent submits payment of the civil penalty, the Final Order\nbecomes the final administrative decision and the right to petition for reconsideration is waived.\nThe terms and conditions of this Final Order are effective upon service in accordance with 49\nC.F.R. § 190.5.\nApril 26, 2023\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":13191}