# 2018 AL NG Program Evaluation - al-2018-gas-program-evaluation (Alabama; Natural Gas State Program Evaluation)

- **operation:** document
- **citation:** PHMSA al-2018-gas-program-evaluation
- **title:** 2018 AL NG Program Evaluation - al-2018-gas-program-evaluation (Alabama; Natural Gas State Program Evaluation)
- **source type:** inspection
- **agency:** Pipeline and Hazardous Materials Safety Administration
- **status:** historical
- **official:** true
- **published on:** 2018-01-01
- **effective on:** Not available
- **summary:** 2018 PHMSA natural gas program evaluation for Alabama.
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- **source url:** https://www.phmsa.dot.gov/sites/phmsa.dot.gov/files/docs/subdoc/4381/al-2018-gas-program-evaluation.pdf
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1200 New Jersey Avenue SE Washington DC 20590 U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 2018 Gas State Program Evaluation for Alabama Public Service Commission Document Legend PART: O -- Representative Date and Title Information A -- Progress Report and Program Documentation Review B -- Program Inspection Procedures C -- Program Performance D -- Compliance Activities E -- Incident Investigations F -- Damage Prevention G -- Field Inspections H -- Interstate Agent State (If Applicable) I -- 60106 Agreement State (If Applicable) DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 1

2018 Gas State Program Evaluation -- CY 2018 Gas State Agency: Alabama Rating: Agency Status: Date of Visit: 04/22/2019 - 05/10/2019 Agency Representative: Wallace Jones - Director, Gas Pipeline Safety Division PHMSA Representative: Glynn Blanton, US DOT/PHMSA State Evaluator Commission Chairman to whom follow up letter is to be sent: Name/Title: Twinkle Andress Cavanaugh, President Agency: Alabama Public Service Commission Address: 100 N. Union St., Suite 800 City/State/Zip: Montgomery,, Alabama 36104 60105(a): Yes 60106(a): No Interstate Agent: No INSTRUCTIONS: Complete this evaluation in accordance with the Procedures for Evaluating State Pipeline Safety Program. The evaluation should generally reflect state program performance during CY 2018 (not the status of performance at the time of the evaluation). All items for which criteria have not been established should be answered based on the PHMSA representative's judgment. A deficiency in any one part of a multiple part question should be scored as needs improvement. Determine the answer to the question then select the appropriate point value. If a state receives less then the maximum points, include a brief explanation in the space provided for general comments/regional observations. If a question is not applicable to a state, select NA. Please ensure all responses are COMPLETE and ACCURATE, and OBJECTIVELY reflect state program performance. Increasing emphasis is being placed on performance. This evaluation together with selected factors reported in the state's annual progress report attachments provide the basis for determining the state's pipeline safety grant allocation. Scoring Summary PARTS Possible Points Points Scored A Progress Report and Program Documentation Review 10 10 B Program Inspection Procedures 13 13 C Program Performance 48 48 D Compliance Activities 15 15 E Incident Investigations 11 11 F Damage Prevention 8 8 G Field Inspections 12 12 H Interstate Agent State (If Applicable) 0 0 I 60106 Agreement State (If Applicable) 0 0 TOTALS 117 117 State Rating................................................................................................................................................... 100.0 DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 2

PART A - Progress Report and Program Documentation Review Points(MAX) Score 1 Accuracy of Jurisdictional Authority and Operator/Inspection Units Data - Progress 1 1 Report Attachment 1 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Attachment 1 shows 21 master meter operators, 31 intrastate transmission and 2 intrastate LNG facilities. Jurisdictional authority is located in Alabama Code Title 37, Article 3, Paragraphs 37-4-80 through 37-4-88 for natural gas and 37-4-90 through 37-4-97 for hazardous liquids). 2 Review of Inspection Days for accuracy - Progress Report Attachment 2 Yes = 1 No = 0 Needs Improvement = .5 1 1 Evaluator Notes: A review of records and files found information on Attachment 2- State Inspection Activity was correct. The number of inspections performed in CY2018 (1040.5) was more than in CY2017. No issues of concern were found in this review. 3 Accuracy verification of Operators and Operators Inspection Units in State - Progress 1 1 Report Attachment 3 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: A review of Attachment 3 - List of Operators found the information correct. Information on name changes to several systems was provided. No areas of concerns were found. 4 Were all federally reportable incident reports listed and information correct? - Progress 1 1 Report Attachment 4 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Two incidents occurred in CY2018. Reviewed accident report information and files. The two incidents were on gas transmission lines. The Spire Alabama Mobile County incident is still under investigation due to waiting the results from the testing laboratory on the root cause of the leak. 5 Accuracy verification of Compliance Activities - Progress Report Attachment 5 1 1 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Reviewed and verified violations found, corrected and carry over for calendar year 2018. The number of carry overs (114) continue to be high from previous review of attachment 5. This item was discussed with program manager. In the discussion with the program manager, he provided documentation to show 58 of the 114 carry over violations were cleared as of 4-22-2019. It is anticipated this number will be less than 25. The number of compliance actions taken against the operators was checked and verified. No issues were found or noted. 6 Were pipeline program files well-organized and accessible? - Progress Report Attachment 6 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: 2 2 Inspection reports, letters, forms and other pipeline safety information was accessible on the main server I drive. All forms used by inspectors are listed in Appendix C in the AL PSC Pipeline Safety Procedure Manual. No areas of concern. 7 Was employee listing and completed training accurate and complete? - Progress Report 1 1 Attachment 7 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Conducted a review on each inspector and compared their completion courses to TQ Blackboard and records. All employees participating in the pipeline safety program were listed properly pertaining to their category. Nine inspectors are qualified Gas inspectors and seven inspectors are Gas IM qualified. DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 3

8 Verification of Part 192,193,198,199 Rules and Amendments - Progress Report 1 1 Attachment 8 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: All rules have been adopted. Information listed in Attachment 8 is correct. Civil penalties amount of $200,000 per day up to $2 M for a related series of violations is the same amount as PHMSA. 9 List of Planned Performance - Did state describe accomplishments on Progress Report in 1 1 detail - Progress Report Attachment 10 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: A review of Attachment 10 found the information concise and provided the reader an excellent description of the programs goals and objectives. 10 General Comments: Info Only = No Points Evaluator Notes: No loss of points occurred in this section of the review. Info Only Info Only Total points scored for this section: 10 Total possible points for this section: 10 DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 4

PART B - Program Inspection Procedures Points(MAX) Score 1 Standard Inspection procedures should give guidance to state inspectors that insure 2 2 consistency in all inspections conducted by the state? The following elements should be addressed at a minimum - pre-inspection activities, inspection activities, post-inspection activities. Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: This information is found in Alabama Pipeline Safety Program Operations Plan on pages 12-15, Section V. Conducting Inspections: Sub-Sections A-G. 2 IMP and DIMP Inspection procedures should give guidance to state inspectors that insure 1 1 consistency in all inspections conducted by the state? The following elements should be addressed at a minimum - pre-inspection activities, inspection activities, post-inspection activities. Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: A review of Alabama Pipeline Safety Program Operations Plan found this item listed on pages 18-19, Section V. Conducting Inspections: Sub-Sections N & P. 3 OQ Inspection procedures should give guidance to state inspectors that insure 1 1 consistency in all inspections conducted by the state? The following elements should be addressed at a minimum - pre-inspection activities, inspection activities, post-inspection activities. Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: A review of Alabama Pipeline Safety Program Operations Plan dated found this item listed on page 17, Section I.Training and Operator Qualification. 4 Damage Prevention Inspection procedures should give guidance to state inspectors that 1 1 insure consistency in all inspections conducted by the state? The following elements should be addressed at a minimum - pre-inspection activities, inspection activities, post- inspection activities. Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Information on guidance for Damage Prevention is found in Alabama Pipeline Safety Program Operations Plan on pages 18, Section M, Damage Prevention Activities. 5 Any operator training conducted should be outlined and appropriately documented as 1 1 needed. Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: A review of Alabama Pipeline Safety Program Operations Plan found this item listed on pages 18, Operator Training. 6 Construction Inspection procedures should give guidance to state inspectors that insure 1 1 consistency in all inspections conducted by the state? The following elements should be addressed at a minimum - pre-inspection activities, inspection activities, post-inspection activities. Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: This item is listed in Alabama Pipeline Safety Program Operations Plan on pages 15-17, Section V, Subsection H. AL PSC uses their own state form for all construction. The operator is required to file a construction notification to the agency prior to construction work being performed. This is a commission rule. 7 Does inspection plan address inspection priorities of each operator, and if necessary each unit, based on the following elements? DUNS: 961833431 2018 Gas State Program Evaluation 6 6 Alabama Alabama Public Service Commission, Page: 5

Yes = 6 No = 0 Needs Improvement = 1-5 a. Length of time since last inspection (Within five year interval) Yes No Needs Improvement b. Operating history of operator/unit and/or location (includes leakage, incident and compliance activities) Yes No Needs Improvement c. Type of activity being undertaken by operators (i.e. construction) Yes No Needs Improvement d. Locations of operators inspection units being inspected - (HCA's, Geographic areas, Population Density, etc) Yes No Needs Improvement e. Process to identify high-risk inspection units that includes all threats - (Excavation Damage, Corrosion, Natural Forces, Outside Forces, Material and Welds, Equipment, Yes No Needs Improvement Operators and any Other Factors) f. Are inspection units broken down appropriately? Yes No Needs Improvement Evaluator Notes: Alabama Pipeline Safety Program Operations Plan found the above items listed above in Appendix D, Risk Management Assessments. The elements of risk were listed separately and ranked on pages 35 & 36. No issues of concern. 8 General Comments: Info Only = No Points Evaluator Notes: No loss of points occurred in this section of the review. Info Only Info Only Total points scored for this section: 13 Total possible points for this section: 13 DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 6

PART C - Program Performance Points(MAX) Score 1 Was ratio of Total Inspection person-days to total person days acceptable? (Director of State Programs may modify with just cause) Chapter 4.3 Yes = 5 No = 0 5 5 A. Total Inspection Person Days (Attachment 2): 1040.13 B. Total Inspection Person Days Charged to the Program (220 X Inspection Person Years) (Attachment 7): 220 X 8.66 = 1905.20 Ratio: A / B 1040.13 / 1905.20 = 0.55 If Ratio >= 0.38 Then Points = 5, If Ratio < 0.38 Then Points = 0 Points = 5 Evaluator Notes: A.Total Inspection Person Days (Attachment 2)= 1040.13 B.Total Inspection Person Days Charged to the program(220*Number of Inspection person years(Attachment 7)=1905.2 Formula:- Ratio = A/B = 1040.13/1905.2 = 0.55 Rule:- (If Ratio >=.38 then points = 5 else Points = 0.) Thus Points = 5 2 Has each inspector and program manager fulfilled the T Q Training Requirements? (See 5 5 Guidelines Appendix C for requirements) Chapter 4.4 Yes = 5 No = 0 Needs Improvement = 1-4 a. Completion of Required OQ Training before conducting inspection as lead? Yes No Needs Improvement b. Completion of Required DIMP*/IMP Training before conducting inspection as lead? *Effective Evaluation CY2013 Yes No Needs Improvement c. Root Cause Training by at least one inspector/program manager Yes No Needs Improvement d. Note any outside training completed Yes No Needs Improvement e. Verify inspector has obtained minimum qualifications to lead any applicable standard inspection as the lead inspector. Yes No Needs Improvement Evaluator Notes: a. Yes, nine inspectors which includes the Program Manager have completed all required gas courses and meet the active gas inspector requirements. b. Yes, six inspectors and the Program Manager have completed all required DIMP/IMP training courses. c. Yes, three inspectors and the Program Manager have completed the root cause course. d. Yes, several inspectors have HAZWOPER Certifications. e. Yes, a review of Blackboard confirm 9 inspectors are qualified to perform a standard inspection as the lead. 3 Did state records and discussions with state pipeline safety program manager indicate adequate knowledge of PHMSA program and regulations? Chapter 4.1,8.1 Yes = 2 No = 0 Needs Improvement = 1 2 2 Evaluator Notes: Yes, Mr. Jones has an excellent understanding of the requirements of the pipeline safety program and completed all TQ courses within three years of employment. He has over forty one years of natural gas experience and been a Program Manager for eleven years. He is currently the Vice Chairman of the National Association of Pipeline Safety Representatives. 4 Did state respond to Chairman's letter on previous evaluation within 60 days and correct or address any noted deficiencies? (If necessary) Chapter 8.1 Yes = 2 No = 0 Needs Improvement = 1 2 2 Evaluator Notes: Yes, Chairman Cavanaugh response letter to Zach Barrett was received on August 9, 2018 and within the required 60-day time frame. Correction action was taken on the five items listed in the letter. DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 7

5 Did State conduct or participate in pipeline safety training session or seminar in Past 3 1 1 Years? Chapter 8.5 Yes = 1 No = 0 Evaluator Notes: Yes, AL PSC conducts an annual seminar each year. The seminar was held in Montgomery, AL on December 4-6, 2018. Number of attendees were three hundred. 6 Did state inspect all types of operators and inspection units in accordance with time intervals established in written procedures? Chapter 5.1 Yes = 5 No = 0 Needs Improvement = 1-4 5 5 Evaluator Notes: Yes, conducted a review of files and inspection reports and found all operator types and inspection units were inspected in accordance to written procedures. A standard inspection is performed on all operators and inspection units yearly. All DIMP, TIMP, OQ and public awareness inspection are performed on a five year cycle. 7 Did inspection form(s) cover all applicable code requirements addressed on Federal 2 2 Inspection form(s)? Did State complete all applicable portions of inspection forms? Chapter 5.1 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, AL PSC continue to use federal and state inspection forms to cover all applicable code sections of their review of the operator. A review of files and inspections found all portions of the forms were completed with a check mark or comment beside each question. 8 Did the state review operator procedures for determining if exposed cast iron pipe was 1 1 examined for evidence of graphitization and if necessary remedial action was taken? (NTSB) Chapter 5.1 Yes = 1 No = 0 Evaluator Notes: Yes, this item is reviewed and checked on the Alabama Gas Field Evaluation Report and PHMSA Standard Inspection Report of a Gas Distribution Operator forms. 9 Did the state review operator procedures for surveillance of cast iron pipelines, including 1 1 appropriate action resulting from tracking circumferential cracking failures, study of leakage history, or other unusual operating maintenance condition? (Note: See GPTC Appendix G-18 for guidance) (NTSB) Chapter 5.1 Yes = 1 No = 0 Evaluator Notes: Yes, this item is reviewed and covered on the Alabama Gas Field Evaluation Report /PHMSA, Standard Inspection Report of a Gas Distribution Operator forms. 10 Did the state review operator emergency response procedures for leaks caused by 1 1 excavation damage near buildings and determine whether the procedures adequately address the possibility of multiple leaks and underground migration of gas into nearby buildings Refer to 4/12/01 letter from PHMSA in response to NTSB recommendation P-00-20 and P-00-21? (NTSB) Chapter 5.1 Yes = 1 No = 0 Evaluator Notes: Yes, this item is reviewed and covered on the Alabama Gas Field Evaluation Report or PHMSA, Standard Inspection Report of a Gas Distribution Operator form. 11 Did the state review operator records of previous accidents and failures including reported third party damage and leak response to ensure appropriate operator response as required by 192.617? Chapter 5.1 Yes = 1 No = 0 Evaluator Notes: DUNS: 961833431 2018 Gas State Program Evaluation 1 1 Alabama Alabama Public Service Commission, Page: 8

Yes, this item is reviewed and covered on the Alabama Gas Field Evaluation Report or PHMSA and Standard Inspection Report of a Gas Distribution Operator form. 12 Has the state reviewed Operator Annual reports, along with Incident/Accident reports, for accuracy and analyzed data for trends and operator issues? Yes = 2 No = 0 Needs Improvement = 1 2 2 Evaluator Notes: Yes, operator's annual reports are reviewed by Program Manager. Incorrect information found or high unaccountable gas loss is noted by Program Manager and forward to the inspector for his review with the operator during the inspection. Information on the review is entered into a data base and used to risk rank the audit schedule with the operator. 13 Has state confirmed intrastate transmission operators have submitted information into NPMS database along with changes made after original submission? Yes = 1 No = 0 Needs Improvement = .5 1 1 Evaluator Notes: Yes, this item is listed as question 4 on the Alabama Gas Field Evaluation Report, and page 3 of the Federal Standard Inspection form. A review of files found this item was checked. 14 Is the state verifying operators are conducting drug and alcohol tests as required by 2 2 regulations? This should include verifying positive tests are responded to in accordance with program. 49 CFR 199 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, they review the operator's drug & alcohol program during the Gas Field Evaluation Inspection. An additional checklist is used to check the positive tests requirements. They use the following two forms, Drug Program Checklist and Contractor Compliance Report. In 2018, AL PSC conducted 98 drug and alcohol inspections. 15 Is state verifying operators OQ programs are up to date? This should include verification 2 2 of any plan updates and that persons performing covered tasks (including contractors) are properly qualified and requalified at intervals determined in the operators plan. 49 CFR 192 Part N Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, reviewed files and found OQ programs have been inspected on each operator in 2019. The total number of person days on OQ was 48.5. AL PSC uses the federal form Protocol 9 to check and verify the programs. 16 Is state verifying operator's gas transmission integrity management programs (IMP) are 2 2 up to date? This should include a previous review of IMP plan, along with monitoring progress on operator tests and remedial actions. In addition, the review should take in to account program review and updates of operators plan(s). (Are the State's largest operators programs being contacted or reviewed annually? Are replies to Operator IM notifications addressed? (formerly part of Question C-13)). 49 CFR 192 Subpart 0 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, AL PSC is verifying the gas transmission integrity program are up to date by using the Alabama Gas Field Evaluation Inspection form. They review the IMP plan, along with test and action taken by the operator during their discussion with the operator's representatives. On their inspection form questions 6 in the form address this item Yes, the state's largest operator's program is reviewed annually. A check of files found Spire Alabama was inspected April, 2018. 17 Is state verifying operator's gas distribution integrity management Programs (DIMP)? This should include a review of DIMP plans, along with monitoring progress. In addition, the review should take in to account program review and updates of operators plan(s). (Are the State's largest operators programs being contacted or reviewed annually?). 49 CFR 192 Subpart P Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: 2 2 Yes, AL PSC is verifying the gas distribution integrity program using the Alabama Gas Field Evaluation Inspection form. A DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 9

review of DIMP plan, along with test and action taken by the operator are discussed and reviewed when completing question 5 in the form. Yes, the state's largest operator programs are reviewed annually. A review of files confirms this information. 18 Is state verifying operators Public Awareness programs are up to date and being followed. State should also verify operators have evaluated Public Awareness programs for effectiveness as described in RP1162. PAPEI Effectiveness Inspections should be conducted every four years by operators. 49 CFR 192.616 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: 2 2 Yes, AL PSC conducted 83 PAPEI inspections and reviewed with the operator the effectiveness of their program. 19 Does the state have a mechanism for communicating with stakeholders - other than state 1 1 pipeline safety seminar? (This should include making enforcement cases available to public). Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, they continue to communicate with all stakeholders using the Alabama Natural Gas Association and AL PSC websites. 20 Did state execute appropriate follow-up actions to Safety Related Condition (SRC) Reports? Chapter 6.3 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: No safety related condition reports in CY2018. 1 NA 21 Did the State ask Operators to identify any plastic pipe and components that has shown a 1 1 record of defects/leaks and what those operators are doing to mitigate the safety concerns? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, this item is described and listed on the Alabama Gas Field Evaluation form question 40. A review of files found this item was checked by the inspector during their field inspections. 22 Did the state participate in/respond to surveys or information requests from NAPSR or 1 1 PHMSA? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, a review of emails from Robert Clarillos to Wallace Jones confirmed participation in surveys from NAPSR. 23 If the State has issued any waivers/special permits for any operator, has the state verified 1 1 conditions of those waivers/special permits are being met? This should include having the operator amend procedures where appropriate. No = 0 Needs Improvement = .5 Yes = 1 Evaluator Notes: Yes. This active waiver was issued in 2009 to Alabama Gas Corp for un-odorized gas to be delivered to Hunt Oil Corp continues to be monitored. The waiver issued in 2015 to Exxon-Mobil pertaining to installation of new reinforced thermoplastic pipe (RTP) is also being monitored by AL PSC during their normal inspection audits. 24 Did the state attend the NAPSR National Meeting in CY being evaluated? No = 0 Needs Improvement = .5 Yes = 1 1 1 Evaluator Notes: Yes. Wallace Jones, Daniel Trapp and Greg Meadows attended the NAPSR National Meeting in Santa Fe, NM. 25 DUNS: 961833431 2018 Gas State Program Evaluation Discussion on State Program Performance Metrics found on Stakeholder Communication site - http://primis.phmsa.dot.gov/comm/states.htm No = 0 Needs Improvement = 1 Yes = 2 2 2 Alabama Alabama Public Service Commission, Page: 10

a. Discussion of Potential Accelerated Actions (AA's) based on any negative trends Yes No Needs Improvement b. NTSB P-11-20 Meaningful Metrics Yes No Needs Improvement Evaluator Notes: Reviewed with Program Manager the State Program Performance Metrics and found the total number of leaks eliminated/ repaired were trending down. Leaks scheduled for repair at end of year was 36. Number of damages per 1,000 tickets listed on the 2018 annual reports was not available during this audit. However, Program Manager has performed a review of damages and determined the number is approximately 4.6 per 1000 locate request. 26 Discussion with State on accuracy of inspection day information submitted into State 1 1 Inspection Day Calculation Tool (SICT) Has the State updated SICT data? No = 0 Yes = 1 Evaluator Notes: A review of the SICT program and input into the spreadsheet was reviewed with Program Manager. He is familiar with how to make changes and recently changed the SICT number for HL program from 34 to 20 inspection person days. 27 Did the State verify Operators took appropriate action regarding Pipeline Flow Reversals, Product Changes and Conversions to Service? See ADP-2014-04 Needs Improvement = .5 No = 0 Yes = 1 1 1 Evaluator Notes: Discussion with Program Manager and AL PSC Staff confirm they are not aware of any pipeline flow reversals, product changes, or conversion to service in the state. This item was added to their standard inspection form, question 42. 28 General Comments: Info Only = No Points Evaluator Notes: No loss of points occurred in this section of the review. Info Only Info Only Total points scored for this section: 48 Total possible points for this section: 48 DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 11

PART D - Compliance Activities Points(MAX) Score 1 Does the state have written procedures to identify steps to be taken from the discovery to 4 4 resolution of a probable violation? Chapter 5.1 Yes = 4 No = 0 Needs Improvement = 1-3 a. Procedures to notify an operator (company officer) when a noncompliance is identified Yes No Needs Improvement b. Procedures to routinely review progress of compliance actions to prevent delays or breakdowns Yes No Needs Improvement c. Procedures regarding closing outstanding probable violations Yes No Needs Improvement Evaluator Notes: a. This information is listed in Alabama Public Service Commission procedure manual in Section S. Notices of Probable Violations pages 19-20. b. This information is listed under section U. Notice of Probable Violation Tracking, pages 21-22 c. This information is listed under section V. Removal or Correction of a Probable Violation, pages 22-23 2 Did the state follow compliance procedures (from discovery to resolution) and adequately 4 4 document all probable violations, including what resolution or further course of action is needed to gain compliance? (Incident Investigations do not need to meet 30/90 day requirement) Chapter 5.1 Yes = 4 No = 0 Needs Improvement = 1-3 a. Were compliance actions sent to company officer or manager/board member if municipal/government system? Yes No Needs Improvement b. Document probable violations Yes No Needs Improvement c. Resolve probable violations Yes No Needs Improvement d. Routinely review progress of probable violations Yes No Needs Improvement e. Within 30 days, conduct a post-inspection briefing with the owner or operator of the gas or hazardous liquid pipeline facility inspected outlining any concerns; and Yes No Needs Improvement f. Within 90 days, to the extent practicable, provide the owner or operator with written preliminary findings of the inspection. Yes No Needs Improvement Evaluator Notes: a. Yes, files and inspection reports show letters were being sent to the company officer of the private companies, mayor/ superintendent of municipality systems and director/manager of housing authorities. Reviewed the contact names of the individuals on the operator's list and compared to inspection reports and found correct. b. Yes, a review of files found 181 violations against 81 operators were cited for Notice of Probable Violations. Reviewed inspection reports and found violations were documented correctly. c. Yes, violations were resolved by a follow-up inspection or additional information being filed by the operator to the agency. d. Yes, Program Manager/Administrative Assistant review on a quarterly schedule all violations. Information about the status of the information is sent to the affected inspector to perform a follow-up inspection. e. An exit interview is conducted immediately after the inspection with the operator. Information about areas of concerns or potential violations are shared with the operator's representatives. This item is described in AL PSC Procedures manual on page 17. f. All Notice of Probable Violations letters are provided to the operator about their findings within 90 days of the date of the inspection. 3 Did the state issue compliance actions for all probable violations discovered? Yes = 2 No = 0 Needs Improvement = 1 2 2 Evaluator Notes: Yes, a review of files and inspection reports found eighty-one NOPV's were issued in CY2018. No areas of concern. 4 Did compliance actions give reasonable due process to all parties? Including "show cause" hearing if necessary. Yes = 2 No = 0 Evaluator Notes: 2 2 Yes, no show cause hearings were held in 2018 against the operator. Operators agreed to correct the violations. DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 12

5 Is the program manager familiar with state process for imposing civil penalties? Were 2 2 civil penalties considered for repeat violations (with severity consideration) or violations resulting in incidents/accidents? (describe any actions taken) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, program manager is familiar with imposing civil penalties and assessed a civil penalty against operators. The last civil penalty issued against an operator was in CY2015 against Air Base Inn. 6 Can the State demonstrate it is using their enforcement fining authority for pipeline safety violations? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, enforcement fining authority was taken in CY2015 against Air Base Inn, a master meter operator. 1 1 7 General Comments: Info Only = No Points Evaluator Notes: No loss of points occurred in this section of the review. Info Only Info Only Total points scored for this section: 15 Total possible points for this section: 15 DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 13

PART E - Incident Investigations Points(MAX) Score 1 Does the state have written procedures to address state actions in the event of an incident/ 2 2 accident? Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Incidents. Yes, this information is located in Alabama Pipeline Safety Program Operations Plan on pages 25-29, VI. Investigation of 2 Does state have adequate mechanism to receive and respond to operator reports of 2 2 incidents, including after-hours reports? And did state keep adequate records of Incident/ Accident notifications received? Chapter 6 Yes = 2 No = 0 Needs Improvement = 1 a. Acknowledgement of MOU between NTSB and PHMSA (Appendix D) Yes No Needs Improvement b. Acknowledgement of Federal/State Cooperation in case of incident/accident (Appendix E) Yes No Needs Improvement Evaluator Notes: Yes, the MOU and Federal/State Cooperation agreement documents are listed in Appendix J of Alabama Pipeline Safety Program Operation Plan. Additionally, Alabama PSC's GPS Rule #9, requires the pipeline operator to give telephonic notice of all incidents by calling (334) 242-5778 to report incidents during normal business hours of 8:00 AM to 5:00 PM. After hours, the operator is required to call the Pipeline Safety Investigator assigned to or located in the operator's region of the state (North, Central or South Alabama). 3 If onsite investigation was not made, did state obtain sufficient information from the operator and/or by other means to determine the facts to support the decision to not go on-site? Chapter 6 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 1 Yes, the two incidents that occurred in CY2018 on SPIRE Alabama Inc. properties were investigated by AL PSC staff. 4 Were all incidents investigated, thoroughly documented, and with conclusions and 3 3 recommendations? Yes = 3 No = 0 Needs Improvement = 1-2 a. Observations and document review Yes No Needs Improvement b. Contributing Factors Yes No Needs Improvement c. Recommendations to prevent recurrences when appropriate Yes No Needs Improvement Evaluator Notes: Yes, the two incidents that occurred in CY 2018 were investigated and conclusions and factors that contributed to the incidents were listed in the reports. 5 Did the state initiate compliance action for violations found during any incident/accident investigation? Yes = 1 No = 0 Evaluator Notes: No compliance actions were necessary on the two incidents. 1 1 6 Did the state assist Region Office or Accident Investigation Division (AID) by taking appropriate follow-up actions related to the operator incident reports to ensure accuracy and final report has been received by PHMSA? (validate report data from operators concerning incidents/accidents and investigate discrepancies) Chapter 6 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 1 Yes, Program Manager and Inspectors related information to AID and Region Office on all incident reports. DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 14

7 Does state share lessons learned from incidents/accidents? (sharing information, such as: 1 1 at NAPSR Region meetings, state seminars, etc) Yes = 1 No = 0 Evaluator Notes: Yes, information on the two incidents was shared at the State-to-State Presentation during the NAPSR Southern Region meeting. 8 General Comments: Info Only = No Points Evaluator Notes: No loss of points occurred in this section of the review. Info Only Info Only Total points scored for this section: 11 Total possible points for this section: 11 DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 15

PART F - Damage Prevention Points(MAX) Score 1 Has the state reviewed directional drilling/boring procedures of each pipeline operator or 2 2 its contractor to determine if they include actions to protect their facilities from the dangers posed by drilling and other trench less technologies? NTSB Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, during an onsite construction inspection this item is reviewed with the operator and his construction supervisor. It is checked during the standard inspection review of the operator's O & M Plan. This item is question 20 on the construction inspection checklist form. 2 Did the state inspector verify pipeline operators are following their written procedures pertaining to notification of excavation, marking, positive response and the availability and use of the one call system? Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, this is item 31 on the construction inspection checklist form. 2 2 3 Did the state encourage and promote practices for reducing damages to all underground 2 2 facilities to its regulated companies? (i.e. such as promoting/adopting the CGA Best Practices encouraging adoption of the 9 Elements, etc.) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, Program Manager continues to participate in the Alabama Damage Prevention Alliance, Alabama Damage Prevention Summit and support the 811-promulgation signed by the Governor in April. 4 Has the agency or another organization within the state collected data and evaluated 2 2 trends on the number of pipeline damages per 1,000 locate requests? (This can include DIRT and other data shared and reviewed by the pipeline safety program) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, the program manager continues to collect damage data and evaluates the trends on the number of pipeline damages per 1,000 locate request each year. This information is presented yearly at the NAPSR Southern region meeting. 5 General Comments: Info Only = No Points Evaluator Notes: No loss of points occurred in this section of the review. Info Only Info Only Total points scored for this section: 8 Total possible points for this section: 8 DUNS: 961833431 2018 Gas State Program Evaluation Alabama Alabama Public Service Commission, Page: 16

PART G - Field Inspections Points(MAX) Score 1 Operator, Inspector, Location, Date and PHMSA Representative Info Only Info Only Info Only = No Points Name of Operator Inspected: Spire Gas Company - Gulf Name of State Inspector(s) Observed: Jonathan Kimbril (Lead) Gas Pipeline Safety Investigator, & Michael McVay Gas Pipeline Safety Investigator Location of Inspection: Mobile, Alabama Date of Inspection: May 6-9. 2019 Name of PHMSA Representative: Glynn Blanton, PHMSA State Liaision Evaluator Notes: May 6th:This was a cast iron replacement project located on Dogwood Lane being performed by Miller Pipeline Construction Company for Spire Gas Company. The project consisted of replacement of service lines using a directional drilling procedure. Investigators reviewed written procedures, marking of facilities, verification of 811 locate request, OQ cards, type and date of PE service lines installed. Investigators were using AL PSC construction form to review the project for compliance. An exist interview was conducted with Spire Gas Company personnel Richard Jay & Dorman Chapman. No violations were found. May 8th: Observed 6 operators and 120 individuals being qualified for PE joining at Riviera Utilities in Foley, AL. Three AL PSC investigators; Randy Hammond, Jonathan Kimbril & Michael McVay were reviewing and qualifying each individual's butt, socket, saddle and electrofusion joint after the joint was destructively made in accordance with manufacture's procedures . May 9th: North Baldwin Utilities, (NBU) in Bay Minette, AL. This was a standard inspection performed by Jonathan Kimbril & Michael McVay. The following individuals were present from the NBU: Jason Padgett, General Manager, Shane Hall, Natural Gas Supervisor & Jeff Donald. Records were reviewed by each investigator for compliance to the safety regulations in the company's office. After a thorough review, the field inspection was performed on critical valves along with taking pipe-to-soil potential readings at random locations in the operator's service areas. The inspection was to continue the next day. However, an exit interview was conducted after the field i
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