2012 KS NG Program Evaluation - ks2012ngprogramevaluation (Kansas; Natural Gas State Program Evaluation)

KS NG Program Evaluation, 2012, page 1Official PDF1200 New Jersey Avenue SE Washington DC 20590 U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 2012 Natural Gas State Program Evaluation for KANSAS CORPORATION 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: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 1#

KS NG Program Evaluation, 2012, page 22012 Natural Gas State Program Evaluation -- CY 2012 Natural Gas State Agency: Kansas Rating: Agency Status: 60105(a): Yes 60106(a): No Interstate Agent: No Date of Visit: 04/28/2013 - 05/02/2013 Agency Representative: Leo Haynos, Chief of Gas Operations & Pipeline Safety Daniel Ostahowski, Pipeline Safety Engineer/Assistant Chief Doug Fundis, Pipeline Safety Inspector PHMSA Representative: Glynn Blanton, USDOT/State Programs Commission Chairman to whom follow up letter is to be sent: Name/Title: Mark Sievers, Chairman Agency: Kansas Corporation Commission Address: 1500 SW Arrowhead Road City/State/Zip: Topeka, Kansas 66604-4027 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 2012 (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. Field Inspection (PART G): The field inspection form used will allow different areas of emphasis to be considered for each question. Question 13 is provided for scoring field observation areas. In completing PART G, the PHMSA representative should include a written summary which thoroughly documents the inspection. Scoring Summary PARTS Possible Points Points Scored A Progress Report and Program Documentation Review 10 10 B Program Inspection Procedures 15 15 C Program Performance 46 44 D Compliance Activities 15 15 E Incident Investigations 9 9 F Damage Prevention 8 7 G Field Inspections 12 12 H Interstate Agent State (If Applicable) 0 0 I 60106 Agreement State (If Applicable) 0 0 TOTALS 115 112 State Rating................................................................................................................................................... 97.4 DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 2#

KS NG Program Evaluation, 2012, page 3PART 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 (A1a) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Reviewed information entered into Attachment 1 and found it correct. A review of office records and computer spreadsheets indicated all inspection units match records described in the progress report attachments. Totals and Information on Attachment 3 is consistent with the operator unit totals on Attachment 1. No areas of concerns were found or noted. 2 Review of Inspection Days for accuracy - Progress Report Attachment 2 (A1b) Yes = 1 No = 0 Needs Improvement = .5 1 1 Evaluator Notes: A review of the 2012 KSCC Progress Report found the number of inspection days entered for OQ in the footnotes was incorrect. The number should be 47 instead of 50. This number was verified in PHMSA OQ data base. Needs improvement in keeping the footnote information correct. No loss of points occurred. 3 Accuracy verification of Operators and Operators Inspection Units in State - Progress 1 1 Report Attachment 3 (A1c) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: The number of operators and inspection units on Attachment 3 matched the office records maintained by Kansas Corporation Commission (KSCC). 4 Were all federally reportable incident reports listed and information correct? - Progress Report Attachment 4 (A1d) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 1 Yes, a review of PHMSA's database indicated incidents were reported correctly as shown on Attachment 4. 5 Accuracy verification of Compliance Activities - Progress Report Attachment 5 (A1e) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Information on attachment 5 was verified with KSCC office file records and found correct. 1 1 6 Were pipeline program files well-organized and accessible? - Progress Report 2 2 Attachment 6 (A1f, A4) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, a review of the file folders found them accessible and well-organized. Each file contained the inspection report and letter to the operator pertaining to the inspection or violations found. All reports reviewed support the safety program activities and inspections performed in Attachment 6. 7 Was employee listing and completed training accurate and complete? - Progress Report 1 1 Attachment 7 (A1g) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, a detailed review of employees listed on attachment 7 was conducted and compared to the SABE training. One individual was found listed in the Inspector/Investigator category and has not attended all TQ courses within 3 years of attending the first course. No loss of points occurred. 8 Verification of Part 192,193,198,199 Rules and Amendments - Progress Report Attachment 8 (A1h) DUNS: 102979593 2012 Natural Gas State Program Evaluation 1 1 Kansas KANSAS CORPORATION COMMISSION, Page: 3#

KS NG Program Evaluation, 2012, page 4Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: A review of PHMSA State Program rules and regulations in SharePoint indicated civil penalty amounts for pipeline safety regulations is different. Additionally, two amendments #115 & 116 will need to be adopted by CY2013 to previous the loss of federal funds. 9 List of Planned Performance - Did state describe accomplishments on Progress Report in 1 1 detail - Progress Report Attachment 10 (H1-3) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, KSCC provided a description of their planned annual and long term goals for the pipeline safety program in attachment 10. Good summary of planned and past performance. 10 General Comments: Info Only = No Points Evaluator Notes: No loss of points occurred in this section. Info Only Info Only Total points scored for this section: 10 Total possible points for this section: 10 DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 4#

KS NG Program Evaluation, 2012, page 5PART B - Program Inspection Procedures Points(MAX) Score 1 Standard Inspections (B1a) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, KSCC Pipeline Safety Section Procedures, Section 5.1.3. 2 2 2 IMP Inspections (including DIMP) (B1b) 1 1 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, KSCC Pipeline Safety Section Procedures, Sections 5.1.3.2 and 5.1.3.3. 3 OQ Inspections (B1c) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, KSCC Pipeline Safety Section Procedures, Section 5.1.3.4. 1 1 4 Damage Prevention Inspections (B1d) 1 1 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, KSCC Pipeline Safety Section Procedures, Section 7.1. 5 On-Site Operator Training (B1e) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, KSCC Pipeline Safety Section Procedures, Section 5.1.3.5. 1 1 6 Construction Inspections (B1f) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, KSCC Pipeline Safety Section Procedures, Section 5.1.3.8. 1 1 7 Incident/Accident Investigations (B1g) 2 2 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, KSCC Pipeline Safety Section Procedures, Section 6.1. DUNS: 102979593 2012 Natural Gas State Program Evaluation 8 Does inspection plan address inspection priorities of each operator, and if necessary each 6 6 unit, based on the following elements? (B2a-d, G1,2,4) Yes = 6 No = 0 Needs Improvement = 1-5 a. Length of time since last inspection 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 Kansas KANSAS CORPORATION COMMISSION, Page: 5#

KS NG Program Evaluation, 2012, page 6Evaluator Notes: Yes, KSCC Pipeline Safety Section Procedures, Section 5.1.2, includes most of these items. It was suggested consideration be taken to include population density into the model to better round out the risk ranking. KSCC inspects all operators on their risk ranking model or within two years from the last inspection performed. 9 General Comments: Info Only = No Points Evaluator Notes: No areas of concern or loss of points. Info Only Info Only Total points scored for this section: 15 Total possible points for this section: 15 DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 6#

KS NG Program Evaluation, 2012, page 7PART 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 (A12) Yes = 5 No = 0 5 5 A. Total Inspection Person Days (Attachment 2): 866.28 B. Total Inspection Person Days Charged to the Program (220 X Inspection Person Years) (Attachment 7): 220 X 6.35 = 1397.73 Ratio: A / B 866.28 / 1397.73 = 0.62 If Ratio >= 0.38 Then Points = 5, If Ratio < 0.38 Then Points = 0 Points = 5 Evaluator Notes: A=866.28; B= (220 x 6.35=1397) Ratio is 0.62. The ratio meets and excesses the minimum requirement of 0.38. Therefore, a point score of 5 was awarded. 2 Has each inspector and program manager fulfilled the T Q Training Requirements? (See 5 3 Guidelines for requirements) Chapter 4.4 (A8-A11, G19) 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 Evaluator Notes: No, one Damage Prevention personnel was assigned to the base program and performing gas safety inspections. This individual has not attended all the required courses within 3 years from taking the first course. Reminder, all inspectors performing DIMP inspections will need to attend PL1245 course. One point deduction for not attending PL1245 course. One point deduction for having an individual performing pipeline safety inspections without attending the required TQ courses. 3 Did state records and discussions with state pipeline safety program manager indicate 2 2 adequate knowledge of PHMSA program and regulations? Chapter 4.1,8.1 (A5) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, Leo Haynos has over 21 years of experience in pipeline safety, understands the requirements in submitting a grant application and payment agreement documents. No issues. 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 (A6-7) Yes = 2 No = 0 Needs Improvement = 1 2 2 Evaluator Notes: Yes, KSCC responded to the November 19, 2012 letter from Zach Barrett on January 16, 2013. Chairman Sievers addressed the eight items of concern. The response letter was received within the 60 day time requirement. 5 Did State hold PHMSA TQ Seminar in Past 3 Years? Chapter 8.5 (A3) 2 2 Yes = 2 No = 0 Evaluator Notes: Yes, the last seminar was conducted in October 30 to November 1, 2012. The number of participants who attend was approximately two hundred. 6 Did state inspect all types of operators and inspection units in accordance with time intervals established in written procedures? Chapter 5.1 (B3) 5 5 DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 7#

KS NG Program Evaluation, 2012, page 8Yes = 5 No = 0 Needs Improvement = 1-4 Evaluator Notes: Yes, operators are inspected in accordance with KSCC Pipeline Safety Procedures within required time intervals. 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 (B4-5) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, a review of KSCC inspection forms indicated the information matches the PHMSA federal forms. They have added KSCC specify questions to the form. 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 (B7) Yes = 1 No = 0 Evaluator Notes: Yes, this information is in the standard inspection form. KSCC has more stringent regulations on the monitoring and removed of all cast iron pipelines. 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 (B8) Yes = 1 No = 0 Evaluator Notes: Yes, this is listed in the standard inspection form. KSCC has more stringent regulations pertaining to this item. Docket 12-721 requires additional leakage surveys. 10 Did the state review operator emergency response procedures for leaks caused by 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 (B9) Yes = 1 No = 0 1 1 Evaluator Notes: Yes, this is listed in the standard inspection form, question 31. KSCC has more stringent regulations pertaining to this item. 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 (B10,E5) Yes = 1 No = 0 Evaluator Notes: Yes, this is listed in the standard inspection form, question 152. 1 1 12 Has the state reviewed Operator Annual reports, along with Incident/Accident reports, for 2 2 accuracy and analyzed data for trends and operator issues? Data Initiative (G6-9,G16) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: program. Yes, this item is reviewed prior to and during their inspection audits. It is also being used in their risk model inspection 13 Did state input all applicable OQ, IMP inspection results into federal database in a timely manner? This includes replies to Operator notifications into IMDB database. Chapter 5.1 (G10-12) Yes = 2 No = 0 Needs Improvement = 1 DUNS: 102979593 2012 Natural Gas State Program Evaluation 2 2 Kansas KANSAS CORPORATION COMMISSION, Page: 8#

KS NG Program Evaluation, 2012, page 9Evaluator Notes: the inspection. A review of PHMSA data base found all results are being entered and maintained by each staff members after completion of 14 Has state confirmed intrastate transmission operators have submitted information into NPMS database along with changes made after original submission? (G14) Yes = 1 No = 0 Needs Improvement = .5 1 1 Evaluator Notes: This item is addressed in the Pipeline Safety Procedure and reviewed by each inspector prior to the inspection performed. 15 Is the state verifying operators are conducting drug and alcohol tests as required by regulations? This should include verifying positive tests are responded to in accordance with program. 49 CFR 199 (I1-3) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, This item is addressed in the Pipeline Safety Procedure page 8, section 5.1.3.9. 2 2 16 Is state verifying operators OQ programs are up to date? This should include verification 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 (I4-7) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, this is checked during a review of the operator's O&M Plan. 2 2 17 Is state verifying operator's gas transmission integrity management programs (IMP) are 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). 49 CFR 192 Subpart 0 (I8-12) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, this is checked during a review of the operator's O&M Plan. 2 2 18 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). 49 CFR 192 Subpart P DIMP ? First round of program inspections should be complete by December 2014 2 2 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, this information was found on a separate spreadsheet entitled DIMP. The date of the review, name of operator and other relative information was posted correctly. No issues. 19 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. 49 CFR 192.616 (I13-16) PAPEI Effectiveness Inspections should be complete by December 2013 2 2 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, this information was found on a separate spreadsheet entitled Kansas PAPEI. The name of operator and completion date was posted correctly. No issues. DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 9#

KS NG Program Evaluation, 2012, page 1020 Does the state have a mechanism for communicating with stakeholders - other than state pipeline safety seminar? (This should include making enforcement cases available to public). (G20-21) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, KSCC has a web site available to the public and operators to address this item. No issues. 1 1 21 Did state execute appropriate follow-up actions to Safety Related Condition (SRC) Reports? Chapter 6.3 (B6) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: No Safety Related Condition reports were submitted in CY2012. 1 1 22 Did the State ask Operators to identify any plastic pipe and components that has shown a record of defects/leaks and what those operators are doing to mitigate the safety concerns? (G13) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, Atmos Energy has hydrocarbons and is taking action to correct. 1 1 23 Did the state participate in/respond to surveys or information requests from NAPSR or PHMSA? (H4) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes, survey request from NAPSR 1 1 24 General Comments: Info Only Info Only Info Only = No Points Evaluator Notes: Question 2: No, one Damage Prevention personnel was assigned to the base program and performing gas safety inspections. This individual has not attended all the required courses within 3 years from taking the first course. Reminder, all inspectors performing DIMP inspections will need to attend PL1245 course. One point deduction for not attending PL1245 course. One point deduction for having an individual performing pipeline safety inspections without attending the required TQ courses. Total points scored for this section: 44 Total possible points for this section: 46 DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 10#

KS NG Program Evaluation, 2012, page 11PART 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 (B12-14, B16, B1h) 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 Evaluator Notes: Yes. This item is addressed in the Pipeline Safety Procedure page 9, section 5.1.5 entitled, "Procedures for notifying an operator when noncompliance is identified". 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? Chapter 5.1 (B11,B18,B19) 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. Were probable violations documented? Yes No Needs Improvement c. Were probable violations resolved? Yes No Needs Improvement d. Was the progress of probable violations routinely reviewed? Yes No Needs Improvement Evaluator Notes: Yes, a review of 2012 inspection reports indicated all correspondence is being sent to the City Mayor, Board Member or company officer. All probable violations are reviewed during the exit interview with the operator's representatives who acknowledge the discussion by his or her signature. KSCC maintains and annually updates a data base of company officers or managers. Consideration should be taken to add in correspondence letters the title of the officer. 3 Did the state issue compliance actions for all probable violations discovered? (B15) Yes = 2 No = 0 Needs Improvement = 1 2 2 Evaluator Notes: Yes. A review of files was performed. Individual inspection reports performed in 2012 were a violation was cited indicated compliance action was taken in accordance with KSCC pipeline safety procedures. 4 Did compliance actions give reasonable due process to all parties? Including "show cause" hearing if necessary. (B17, B20) Yes = 2 No = 0 Evaluator Notes: Yes. This item is addressed in the Pipeline Safety Procedure document, section 5.1.9. 2 2 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) (B27) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, an example of action is the civil penalty against Kansas Gas Service in the amount of $25,000 for failure to call emergency responders when the pipeline was found to be leaking. Docket 12-GIMG-584-GIP. 6 Can the State demonstrate it is using their enforcement fining authority for pipeline safety 1 1 violations? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: leaking. Yes, the civil penalty against Kansas Gas Service for failure to call emergency responders when the pipeline was found to be DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 11#

KS NG Program Evaluation, 2012, page 127 General Comments: Info Only = No Points Evaluator Notes: No areas of concern or loss of points. DUNS: 102979593 2012 Natural Gas State Program Evaluation Info Only Info Only Total points scored for this section: 15 Total possible points for this section: 15 Kansas KANSAS CORPORATION COMMISSION, Page: 12#

KS NG Program Evaluation, 2012, page 13PART E - Incident Investigations Points(MAX) Score 1 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 (A2,D1-3) 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. This item is addressed in the Pipeline Safety Procedure document, section 6. 2 If onsite investigation was not made, did state obtain sufficient information from the 1 1 operator and/or by other means to determine the facts to support the decision to not go on-site? Chapter 6 (D4) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes. Reviewed the six incidents reported on Attachment 4. KSCC maintains information on all reportable incidents to their agency. No issues. 3 Were all incidents investigated, thoroughly documented, and with conclusions and 3 3 recommendations? (D5) 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. Reports were detailed and contained information to determine the recommendations or conclusions of fact. 4 Did the state initiate compliance action for violations found during any incident/accident 1 1 investigation? (D6) Yes = 1 No = 0 Evaluator Notes: Yes, the Kansas Gas Service incident for failure to call emergency responders when the pipeline was found to be leaking is an example of compliance action. 5 Did the state assist region office 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 (D7) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes. 1 1 6 Does state share lessons learned from incidents/accidents? (sharing information, such as: at NAPSR Region meetings, state seminars, etc) (G15) Yes = 1 No = 0 Evaluator Notes: Yes, this type of information was shared with NAPSR members during the Central Region Meeting. 1 1 7 General Comments: Info Only = No Points Evaluator Notes: DUNS: 102979593 2012 Natural Gas State Program Evaluation Info Only Info Only Kansas KANSAS CORPORATION COMMISSION, Page: 13#

KS NG Program Evaluation, 2012, page 14No areas of concern or loss of points. Total points scored for this section: 9 Total possible points for this section: 9 DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 14#

KS NG Program Evaluation, 2012, page 15PART F - Damage Prevention Points(MAX) Score 1 Has the state reviewed directional drilling/boring procedures of each pipeline operator or 2 1 its contractor to determine if they include actions to protect their facilities from the dangers posed by drilling and other trench less technologies? NTSB (E1) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: No. This item was left off the 2012 standard inspection document due to merging the federal and KSCC forms. However, this question has been added to the 2013 standard inspection form and is listed as question number 148. A loss of one point occurred due to not reviewing this item with the operator during CY2012 and not having the question on the form. 2 Did the state inspector check to assure the pipeline operator is following its written 2 2 procedures pertaining to notification of excavation, marking, positive response and the availability and use of the one call system? (E2) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, this item is listed as question 146 on the standard inspection form. A review of inspection reports indicate this item was checked and reviewed with the operator. 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.) (E3) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, several CGA & Kansas One Call meetings were conducted in Kansas to promote damage prevention. The CGA meeting was conducted on September 6 and Kansas One Call meetings conducted on 1-24, 2-7 to 8, 2-21 and 3-7-12. 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) (E4,G5) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: KSCC has a virtual dirt program they use to review the damages per 1,000 locate request. Additionally, the natural gas companies are required to file with them information on their locate request. This information has assisted the KSCC in reviewing this information on annual review. 5 General Comments: Info Only Info Only Info Only = No Points Evaluator Notes: Question 1: No. This item was left off the 2012 standard inspection document due to merging the federal and KSCC forms. However, this question has been added to the 2013 standard inspection form and is listed as question number 148. A one point deduction occurred due to not reviewing the directional drilling/boring procedures of each pipeline operator during the CY2012 inspection visits. Total points scored for this section: 7 Total possible points for this section: 8 DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 15#

KS NG Program Evaluation, 2012, page 16PART 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: Osage City Name of State Inspector(s) Observed: Doug Fundis, Pipeline Safety Inspector Location of Inspection: Osage City, Kansas Date of Inspection: April 29, 2013 Name of PHMSA Representative: Glynn Blanton Evaluator Notes: A standard inspection was performed on Osage City natural gas distribution system located in Osage, KS On April 29, 2013. Doug Fundis, KSCC Pipeline Safety Inspector, was observed. A meeting prior to the inspection was conducted in the office of Mike Gilliland, Director of Utilities. Information about the system pipeline components was checked and recorded on inspection form. The field portion of the inspection involved a review of the regulator stations located at the main take point off Southern Star transmission line and town station. Each relief device was checked to lock-up, pipe to soil potentials were taken at random locations and residential meter sets were checked for proper support. Observed new service line installations with outside contractor performing the work. No issues were noted or observed. 2 Was the operator or operator's representative notified and/or given the opportunity to be present during inspection? (F2) Yes = 1 No = 0 Evaluator Notes: Yes, the operator was notified prior to the inspection. Last inspection performed in 2011. 1 1 3 Did the inspector use an appropriate inspection form/checklist and was the form/checklist used as a guide for the inspection? (New regulations shall be incorporated) (F3) Yes = 2 No = 0 Needs Improvement = 1 2 2 Evaluator Notes: Yes, observed Doug Fundis using KSCC standard inspection form and recording results of the inspection into the document. 4 Did the inspector thoroughly document results of the inspection? (F4) 2 2 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes, Doug Fundis was very thorough in recording the items he observed. 5 Did the inspector check to see if the operator had necessary equipment during inspection 1 1 to conduct tasks viewed? (Maps,pyrometer,soap spray,CGI,etc.) (F5) Yes = 1 No = 0 Evaluator Notes: Yes, prior to the field inspection, Doug Fundis reviewed the equipment with City of Osage gas personnel. Type of equipment checked: CGI, Flame Ionization unit, odorometer, locator unit and pipe to soil potential meter. 6 Did the inspector adequately review the following during the field portion of the state evaluation? (check all that apply on list) (F7) Yes = 2 No = 0 Needs Improvement = 1 a. Procedures 2 2 b. Records c. Field Activities DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 16#

KS NG Program Evaluation, 2012, page 17d. Other (please comment) Evaluator Notes: This was a field inspection. The records and procedure documents were scheduled for review the next day. 7 Did the inspector have adequate knowledge of the pipeline safety program and regulations? (Evaluator will document reasons if unacceptable) (F8) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: 2 2 Yes, Doug Fundis has over twenty years of experience in natural gas work and has completed the required TQ courses. 8 Did the inspector conduct an exit interview? (If inspection is not totally complete the 1 1 interview should be based on areas covered during time of field evaluation) (F9) Yes = 1 No = 0 Evaluator Notes: Yes a discussion with gas company personnel about the items reviewed and found were mentioned during the field review. 9 During the exit interview, did the inspector identify probable violations found during the inspections? (if applicable) (F10) Yes = 1 No = 0 Evaluator Notes: 1 1 No violations were noted or found during this portion of the inspection. A records review was scheduled the next day. 10 General Comments: What did the inspector observe in the field? (Narrative description of field observations and how inspector performed) Best Practices to Share with Other States - (Field - could be from operator visited or state inspector practices) Other. Info Only = No Points a. Abandonment b. Abnormal Operations c. Break-Out Tanks d. Compressor or Pump Stations e. Change in Class Location f. Casings g. Cathodic Protection h. Cast-iron Replacement i. Damage Prevention j. Deactivation k. Emergency Procedures l. Inspection of Right-of-Way m. Line Markers n. Liaison with Public Officials o. Leak Surveys p. MOP q. MAOP r. Moving Pipe s. New Construction t. Navigable Waterway Crossings u. Odorization v. Overpressure Safety Devices w. Plastic Pipe Installation x. Public Education y. Purging z. Prevention of Accidental Ignition Info Only Info Only DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 17#

KS NG Program Evaluation, 2012, page 18A. Repairs B. Signs C. Tapping D. Valve Maintenance E. Vault Maintenance F. Welding G. OQ - Operator Qualification H. Compliance Follow-up I. Atmospheric Corrosion J. Other Evaluator Notes: Total points scored for this section: 12 Total possible points for this section: 12 DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 18#

KS NG Program Evaluation, 2012, page 19PART H - Interstate Agent State (If Applicable) Points(MAX) Score 1 Did the state use the current federal inspection form(s)? (C1) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 2 Are results documented demonstrating inspection units were reviewed in accordance with "PHMSA directed inspection plan"? (C2) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 3 Did the state submit documentation of the inspections within 60 days as stated in its latest Interstate Agent Agreement form? (C3) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 4 Were probable violations identified by state referred to PHMSA for compliance? (NOTE: PHMSA representative has discretion to delete question or adjust points, as appropriate, based on number of probable violations; any change requires written explanation.) (C4) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 5 Did the state immediately report to PHMSA conditions which may pose an imminent safety hazard to the public or to the environment? (C5) Yes = 1 No = 0 Needs Improvement = .5 1 NA Evaluator Notes: 6 Did the state give written notice to PHMSA within 60 days of all probable violations found? (C6) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 7 Did the state initially submit documentation to support compliance action by PHMSA on probable violations? (C7) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 8 General Comments: Info Only = No Points Evaluator Notes: Info Only Info Only Total points scored for this section: 0 Total possible points for this section: 0 DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 19#

KS NG Program Evaluation, 2012, page 20PART I - 60106 Agreement State (If Applicable) Points(MAX) Score 1 Did the state use the current federal inspection form(s)? (B21) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 2 Are results documented demonstrating inspection units were reviewed in accordance with state inspection plan? (B22) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 3 Were any probable violations identified by state referred to PHMSA for compliance? (NOTE: PHMSA representative has discretion to delete question or adjust points, as appropriate, based on number of probable violations; any change requires written explanation.) (B23) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 4 Did the state immediately report to PHMSA conditions which may pose an imminent safety hazard to the public or to the environment? (B24) Yes = 1 No = 0 Needs Improvement = .5 1 NA Evaluator Notes: 5 Did the state give written notice to PHMSA within 60 days of all probable violations found? (B25) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 6 Did the state initially submit adequate documentation to support compliance action by PHMSA on probable violations? (B26) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 NA 7 General Comments: Info Only = No Points Evaluator Notes: Info Only Info Only Total points scored for this section: 0 Total possible points for this section: 0 DUNS: 102979593 2012 Natural Gas State Program Evaluation Kansas KANSAS CORPORATION COMMISSION, Page: 20#