Washington UTC — Pipeline Safety Interpretation

Page 1U.S. Department ofTransportation Pipeline and Hazardous Materials Safety Administration 1200 New Jersey Avenue SE Washington DC 20590 O CT O 4 2018 Mr. Sean C. Mayo Pipeline Safety Director Washington Utilities and Transportation Commission 1300 S. Evergreen Part Drive, S.W., P.O. Box 47250 Olympia Washington 98504-7250 Dear Mr. Mayo: In a July 31, 2018, letter to the Pipeline and Hazardous Materials Safety Administration (PHMSA), you requested an interpretation of 49 CFR Part 191. Specifically, you requested an interpretation of the definition of "incident" as defined under§ 191.3. You stated a local distribution company (LDC), in Washington State, received call for a natural gas leak and dispatched its employees to investigate the source of the leak. Over a period of 4 days, the LDC employees made several excavations, found gas migrating through underground drain piping, and finally managed to pinpoint and isolate a segment of2-inch steel main that stopped the flow of the natural gas. You stated then the LDC replaced the leaking segment of main. You asked whether the leak repair, which cost the operator more than $50,000, would meet the definition of an "incident" under § 191.3? You provided two attachments that show the operator's 30-day follow-up letter to the Commission and the operator's total cost for responding, investigating, repairing and replacing the leaking pipeline including right of way restoration and overhead. One of the attachments shows that the operator believes the $50,000 in property damage must be a direct result of a gas pipeline failure ( event) to be a reportable incident to PHMSA, but not the cost to repair the pipeline. Therefore, the operator does not believe this situation requires an incident report to PHMSA. Under§ 191.3, the defmition of incident states, in relevant part: Incident means .... (ii) Estimated property damage of $50,000 or more, including loss to the operator and others, or both, but excluding cost of gas lost; The Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety provides written clarifications of the Regulations (49 CFR Parts 190-199) in the fonn of interpretation letters. These letters reflect the agency's current application of the regulations to the specific facts presented by the person requesting the clarification. Interpretations do not create legally-enforceable rights or obligations and are provided to help the public understand how to comply with the regulations.#

Page 22 Here, the operator incurred costs of $72,986.99, including labor, equipment, and materials but not the cost of gas lost, in responding to and repairing the gas leak. The $72,986.99 cost of the repair is a loss to the operator attributable to the pipeline gas leak. Accordingly, the incident is a reportable incident under§ 191.3. lfwe can be of further assistance, please contact Tewabe Asebe at 202-366-5523. Sincerely, O u-.~ ~ ae Director, Office of Standards and Rulemaking ( The Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety provides written clarifications of the Regulations ( 49 CFR Parts 190-199) in the form of interpretation letters. These letters reflect the agency's current application of the regulations to the specific facts presented by the person requesting the clarification. Interpretations do not create legally-enforceable rights or obligations and are provided to help the public understand how to comply with the regulations.#

Page 3STATE OF WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION 1300 S. Evergreen Park Dr. S.W., P.O. Box 47250 • Olympia, Washington 98504-7250 (360) 664-1160 • TTY (360) 586-8203 July 31, 2018 John A. Gale Director of Standards and Rulemaking Office of Pipeline Safety Room 24-310 1200 New Jersey Ave, SE Washington DC 20590 RE: Request for Interpretation of "Incident" as defined in §191.3 Dear Mr. Gale: We are requesting an interpretation as to whether the following odor response and leak repair on a natural gas distribution pipeline would meet the definition of an "Incident" under CFR § 191.3 since it involved the release of gas from a pipeline and the total cost to the operator was $72,986.99: A Local Distribution Company (LDC) in Washington State received an odor call and immediately dispatched a technician to investigate the source. Over a period of 4 days the LDC employees made several excavations, found gas migrating through underground drain piping, and finally managed to pinpoint and isolate a segment of 2-inch steel main which stopped the flow of gas. The leaking segment of main was then replaced. ' Our question to you is whether the above detailed leak repair which involved the release of gas from a pipeline and the cost to the operator exceeded $50,000 would meet the definition of an "Incident" under CPR§ 191.3? Included for your review are Attachment A which details the incident in the LDC's 30 day follow-up letter to the Washington Utilities and Transportation Commission and Attachment B which details the total cost ofresponding, investigating, repairing and replacing the leaking pipeline including right of way restoration and overhead. If you have any questions or if we can provide further clarification or details, please contact Scott Rukke at (360) 664-1241 or Joe Subsits at (360) 664-1322. Sincerely, ~ yo Pipeline Safety Director cc: Kim West, Director, Western Region, PHMSA Enclosures Respect. Professionalism. Integrity. Accountability.#

Page 4CNG 234 (5/2015) /t~1f/t CASCADE NATURAL GAS CORPORATION 8113 W. Grandridge Blvd Kennewick WA 99336 Incident or Hazardous Condition Report Incident Type I Evacuation of a Building or HOS/A Adgress 221 N 16th Avenue, Yakima, WA 98902 District Yakima I City I Yakima I County! Yakima I Statel WA Names(s) and address(es) of any person or persons injured or killed, or whose property was damaged (if applicable): N/A Description of the extent of the injuries or property damage (if applicable): N/A Description of the incident or hazardous condition including the date, time, place and reason why the incident or hazardous condition occurred: Outside odor call came in at 3:21, 1/18/17 for 1610 Monroe Ave; area around meter, foundation and service line probed and no gas leaks found. The service next door at 1608 Monroe Ave was alos probed and no gas leaks found. Upon further investigation an odor was detected at a dead tree tump (12' tall, 5' thick) 75' from nearest gas service. The leak was graded #2 leak. On 1/19/17 all services on Monroe Ave from N 16th to end, N 18th Ave from Browne Ave to Monroe Ave and N 16th Ave from Monroe Ave to Folosom Ave were surveyed, probed and foundations checked and manholes were checked. Elevated readings were found on N16th Ave and the main was dug up and checked, no leaks were found. 1/20/17 at approx .. 11:00 am the base of the tree stump at 1610 Monroe Ave was dug up and a 611 concrete irrigation line was found with a crack at the bell that was leaking natural gas. The irrigation pipe was opened up to determine the direction of the flow of gas; it was determined that it was flow from the east towards N 16th Ave. The irrigation line was checked downstream at 3 new locations and checked for flow. A second location on N 16thAve was opened up and no gas leaks were found. It was determined that the flow was coming from Folsom Ave and the main on Folsom was probed and check for gas presents. Alocation of elevated gas readings was excavated (corner of N 16th & Folsom - 221 N 16th Ave) and no gas leaks were found at the main. The main from the corner of Folsom and N 16th to the main on the far side of N 16th was probed and elevated gas readings were found. When excavating the 2" steel main at Folsom across N 16th a leak was found at 9:00 am on 1/21/17 In the middle of N 16th Ave and Folsom Ave; both are fed from 2 directions a 2 stops were installed on N 16th Ave and 1 stop on Folsom Ave. This stopped the leak from the 211 steel main In N 16th and stopped the flow of gas in the irrigation line at approx .. 3:12 pm on 1/21/17. The gas flow was restored approx .. 8:30 pm on 1/21/17. All work was completed and the road temporarly repaired at 4:00 am on 1/22/17. The time and date CNGC was first notified o.f the incident or hazardous condition: 3:21 pm 1/18/2017 The time and date CNGC first responders arrived on site: 3:40 pm 1/18/2017 The time and date the gas pipeline was made safe: 3:12 pm 1/21/2017 The date, time and type of any temporary repair that was made (if applicable): N/A The date, time and type of any permanent repair that was made: After placing stops at 3 different locations (2 on N 16th Ave and 1 on Folsom Ave), the gas flow was stopped on 1/21/2017 at 3:12 pm, 30' of 211 steel main was removed and replaced and gas flow restored at 8:30 pm on 1/21/2017. Description of the gas pipeline Involved In the incident or hazardous condition: STEEL lg) or PE • MAIN 1251 or SERVICE • PIPE DIAMETER: 2" System Operating Pressure (psig) I · 54# MAOP (psig) l 60# The approximate cost of the incident or hazardous condition to CNGC: $ 60,868.00#

Page 5ASCADE NATURAL GAS C O R P O R A T I O ,, <R: A Sul>Jki.Jry of MOO-,,,.,_, 1/roop, klc. 8113 W. GRANDRIDGE BLVD., KENNEWICK, WASHINGTON 99336--7166 TELEPHONE 509-734-4500 FACSIMILE 509-737-9803 www.cngc.com March 02, 20 I 8 Sean Mayo- Pipeline Safety Director State of Washington Utilities and Transportation Commission 1300 S. Evergreen Park Dr. SW P.O. Box 47250 Olympia, WA 98504-7250 Subject: Line item costs for state reportable at 221 N. I 6th Ave., Yakima, WA on 01/21/17 Dear Mr. Mayo, The Washington Utilities and Transportation Commission (WUTC) has requested a line by line cost breakdown for the state reportable at 221 N. 16th Ave., Yakima, WA on 01/21/17. With this request, the WUTC would like Cascade Natural Gas Corporation (CNGC) to identify values associated with property damage and pipeline maintenance costs. The following table categorizes the costs associated with the state reportable: Category Description Amount Labor and Labor Related Total Standard and overtime pay $32,988.46 Contractor Costs Total Sand, gravel, asphalt cutting and flagging $18,000.10 Materials and Purchases Total Pipe, fittings and tools $1,161.37 Auto & Work Equipment Total Company vehicles and equipment $3,171.73 Other Reimbursable Costs Total Hotel for resident, food and water for CNGC crews $456.62 Permit Total Permit for work $1 ,909.60 ES&GA Overhead Total Administrative processes, material stocking, etc. $15,299.11 Property Damage Total Damage or Loss as a direct result of a gas pipeline failure $0.00 Grand Total $72,986.99 As it pertains to these circumstances, PHMSA defines a reportable incident as an event that involves a release of gas from a pipeline and that results in estimated property damage of$50,000 or more. CNGC has performed an extensive review of applicable regulation, interpretation, and rulemaking and we are confident in our interpretation that the $50,000 in property damage must be a direct result of a gas pipeline failure ( event) to be a reportable incident to PHMSA. As such, CNGC does not believe a reportable incident to PHMSA was observed. CNGC appreciates the dialog with the WUTC as it pertains to this matter and the opportunity to more clearly understand the nuances of the property damage reporting requirements. We hope that this information sufficiently addresses the WUTC's concerns; however, if additional information or explanation is needed, please feel free to reach out to me directly at (541) 706-6292. Respectfully Submitted, ~k-- Chris Grissom Manager, Standards and Compliance Cascade Natural Gas Corporation#