2009 ME NG Program Evaluation - me2009ngprogramevaluation (Maine; Natural Gas State Program Evaluation)

ME NG Program Evaluation, 2009, page 1Official PDF1200 New Jersey Avenue SE Washington DC 20590 U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 2009 Natural Gas State Program Evaluation for MAINE PUBLIC UTILITIES COMMISSION Document Legend PART: O -- Representative Date and Title Information A -- General Program Qualifications B -- Inspections and Compliance - Procedures/Records/Performance C -- Interstate Agent States D -- Incident Investigations E -- Damage Prevention Initiatives F -- Field Inspection G -- PHMSA Initiatives - Strategic Plan H -- Miscellaneous I -- Program Initiatives DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 1#

ME NG Program Evaluation, 2009, page 22009 Natural Gas State Program Evaluation -- CY 2009 Natural Gas State Agency: Maine Rating: Agency Status: Date of Visit: 09/13/2010 - 09/17/2010 Agency Representative: Gary Kenny PHMSA Representative: Dino N. Rathod, P.E. Commission Chairman to whom follow up letter is to be sent: Name/Title: John A. Cashman, Chairman Agency: Maine Pubilc Utilities Commission Address: 101 Second Street City/State/Zip: Hallowell, ME 04334 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 2009 (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 certification/agreement attachments provide the basis for determining the state's pipeline safety grant allocation. Field Inspection (PART F): 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 F, the PHMSA representative should include a written summary which thoroughly documents the inspection. Scoring Summary PARTS Possible Points Points Scored A General Program Qualifications 26 24 B Inspections and Compliance - Procedures/Records/Performance 24.5 22.5 C Interstate Agent States 0 0 D Incident Investigations 1.5 1.5 E Damage Prevention Initiatives 9 9 F Field Inspection 12 12 G PHMSA Initiatives - Strategic Plan 9.5 8 H Miscellaneous 3 3 I Program Initiatives 9 9 TOTALS 94.5 89 State Rating................................................................................................................................................... 94.2 DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 2#

ME NG Program Evaluation, 2009, page 3PART A - General Program Qualifications Points(MAX) Score 8 7 1 Did the state submit complete and accurate information on the attachments to its most current 60105(a) Certification/60106 (a) Agreement? (NOTE: PHMSA Representative to verify certification/agreement attachments by reviewing appropriate state documentation. Score a deficiency in any one area as "needs improvement". Attachment numbers appear in parenthesis) Previous Question A.1, Items a-h worth 1 point each Yes = 8 No = 0 Needs Minor Improvement = 3-7 Needs Major Improvement = 2 a. State Jurisdiction and agent status over gas facilities (1) b. Total state inspection activity (2) c. Gas facilities subject to state safety jurisdiction (3) d. Gas pipeline incidents (4) e. State compliance actions (5) f. State record maintenance and reporting (6) g. State employees directly involved in the gas pipeline safety program (7) h. State compliance with Federal requirements (8) SLR Notes: Review of Attachment 5 shows "zero" Compliance Actions in 2009 but indicated nine (9) Civil penalty items resulting in collection of $10,000. This information not accuarate or consistent and PUC was advised to recheckand revise. PUC will contact PHMSA (Zach B) for correcting it in FedStar also. 2 Did the state have an adequate mechanism to receive operator reporting of incidents to ensure state compliance with 60105(a) Certification/60106(a) Agreement requirements (fatality, injury requiring hospitalization, property damage exceeding $50,000 - Mechanism should include receiving "after hours" reports)? (Chapter 6) Previous Question A.2 Yes = 1 No = 0 1 1 SLR Notes: Public Utility Commission 65.407- Chapter 130 Safety & Accident Reporting Requirement information. In addition, ME PUC Contact List (dated Sept 2009) also covers "after-hrs coverage". 3 Has the state held a pipeline safety TQ seminar(s) in the last 3 years? (NOTE: Indicate date of last seminar or if state requested seminar, but T&Q could not provide, indicate date of state request for seminar. Seminars must be held at least once every 3 calendar years.) (Chapter 8.5) Previous Question A.4 Yes = 2 No = 0 SLR Notes: ME PUC participated in a Joint T&Q seminar as a part of New England Pipeline Safety Rep (NEPSR) in Oct 2009 in Meridith, NH 2 2 4 Were pipeline safety program files well-organized and accessible?(NOTE: This also includes electronic files) (Chapter 5) Previous Question A.5 Yes = 1 No = 0 1 1 SLR Notes: 5 Did state records and discussions with the state pipeline safety program manager indicate adequate knowledge of PHMSA program and regulations? (Chapter 4.1, Chapter 8.1) Previous Question A.6 Yes = 2 No = 0 Needs Improvement = 1 2 1 SLR Notes: Gary Farmer was Program Manager till June 2009. Amy Spelke was Acting Program Manager until Sept 2009. Gary Kenny was selected a new Program Manager. This transitional phase has impacted pipeline safety program and PHMSA is working closely to help improve this situation. 6 Did the state respond in writing within 60 days to the requested items in the Chairman's letter following the Region's last program evaluation? (No response is necessary if no items are requested in letter and mark "Yes") (Chapter 8.1) Previous Question A.8 Yes = 1 No = 0 SLR Notes: Yes; ME PUC sent response dated Feb 19, 2010 1 1 7 What actions, if necessary, did the State initiate as a result of issues raised in the Chairperson's letter from the previous year? Did actions correct or address deficiencies from previous year's evaluation? (No response is necessary if no items are requested in letter and mark "Yes") (Chapter 8.1) Previous Question A.8/A.9 Yes = 1 No = 0 DUNS: 002235294 2009 Natural Gas State Program Evaluation 1 1 Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 3#

ME NG Program Evaluation, 2009, page 4SLR Notes: In Sept 2009 Gary Kenny was seelcted as Program Manager. Personnel and Qualifications 8 Has each inspector fulfilled the 3 year TQ training requirement? If No, has the state been granted a waiver regarding TQ courses by the Associate Administrator for Pipeline Safety? (NOTE: If the State has new inspectors who have not attended all TQ courses, but are in a program which will achieve the completion of all applicable courses within 3 years of taking first course (5 years to sucessfully complete), or if a waiver has been granted by the applicable Region Director for the state, please answer yes.) (Chapter 4.4) Previous Question A.10 Yes = 3 No = 0 SLR Notes: Both new PUC inspection staff members have signed up for T&Q training- Gary Kenny 4 courses and Jim Atkins 3 courses 3 3 9 Brief Description of Non-TQ training Activities: Info Only = No Points For State Personnel: For Operators: For Non-Operator Entities/Parties, Information Dissemination, Public Meetings: Info Only Info Only SLR Notes: 10 Did the lead inspectors complete all required T&Q OQ courses and Computer Based Training (CBT) before conducting OQ Inspections? (Chapter 4.4.1) Previous Question A.12 Yes = 1 No = 0 SLR Notes: Gary Farmer had completed OQ training in 2004. New hires Gary Kenny and Jim Atkins were advised to take CBT ASAP. 1 1 11 Did the lead inspectors complete all required TQ Integrity Management (IMP) Courses/Seminars and CBT before conducting IMP Inspections? (Chapter 4.4.1) Previous Question A.13 Yes = 1 No = 0 1 1 SLR Notes: Gary Farmer had completed IMP training. New hires Gary Kenny and Jim Atkins were advised to take CBT ASAP. KENNY, GARY PHMSA-PL3600 Root Cause/Incident Investigation PHMSA-PL3293 Corrosion Control of Pipeline Systems Course PHMSA-PL3355 Safety Evaluation of Control Room Management Programs PHMSA-PL3292 Safety Evaluation of Inline Inspection (ILI)/Pigging Programs Course Tulsa, OK 06/06/2011 06/10/2011 PHMSA-PL3291 Fundamentals of (SCADA) System Technology and Operation Course 12 Was the ratio acceptable of Total inspection Person-days to Total Person-days charged to the program by state inspectors? (Region Director may modify points for just cause) (Chapter 4.3) Previous Question B.12 Yes = 5 No = 0 A. Total Inspection Person Days (Attachment 2): 62.00 B. Total Inspection Person Days Charged to the Program (220 X Inspection Person Years) (Attachment 7): 220 X 0.50 = 110.00 Ratio: A / B 62.00 / 110.00 = 0.56 If Ratio >= 0.38 Then Points = 5, If Ratio < 0.38 Then Points = 0 Points = 5 SLR Notes: ME PUC maintains total person days vs total person days charged to pipeline safety program. Ratio > 0.38 , Score =5 points 5 5 DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 4#

ME NG Program Evaluation, 2009, page 513 Have there been modifications or proposed changes to inspector-staffing levels? (If yes, describe) Previous Question B.13 Info Only = No Points Info Only Info Only SLR Notes: Gary Farmer retired from PUC in June 2009. Gary Kenny was selected as Program Manager in Sept 2009. Jim Atkins was hired as an inspector in Jul 2010. 14 Part-A General Comments/Regional Observations Info Only = No Points Info Only Info Only SLR Notes: In 2009 ME PUC experienced Program Manager changes with retirement of Gary Farmer. This has impacted ability to perform required inspections for CY 2010. This was also discussed with PUC. Total points scored for this section: 24 Total possible points for this section: 26 DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 5#

ME NG Program Evaluation, 2009, page 6PART B - Inspections and Compliance - Procedures/Records/ Performance Points(MAX) Score Inspection Procedures 1 Does the State have a written inspection plan to complete the following? (all types of operators including LNG) (Chapter 5.1) Previous Question B.1 + Chapter 5 Changes + Incorporate LNG Yes = 6.5 No = 0 Needs Improvement = 50% Deduction a Standard Inspections (Including LNG) (Max points = 2) b IMP Inspections (Including DIMP) (Max points = .5) c OQ Inspections (Max points = .5) d Damage Prevention (Max points = .5) e On-Site Operator Training (Max points = .5) f Construction Inspections (Max points = .5) g Incident/Accident Investigations (Max points = 1) h Compliance Follow-up (Max points = 1) SLR Notes: Maine PUC Gas Safety Program Procedures-Rev June 2009 6.5 6.5 Yes No Needs Improvement Yes No Needs Improvement Yes No Needs Improvement Yes No Needs Improvement Yes No Needs Improvement Yes No Needs Improvement Yes No Needs Improvement Yes No Needs Improvement 2 Did the written Procedures for selecting operators adequately address key concerns? (Chapter 5.1) Previous 2 2 Question B.2, items a-d are worth .5 point each Yes = 2 No = 0 Needs Improvement = 50% Deduction a Length of time since last inspection Yes No Needs Improvement b History of Operator/unit and/or location (including leakage , incident and compliance history) Yes No Needs Improvement c Type of activity being undertaken by operator (construction etc) Yes No Needs Improvement d For large operators, rotation of locations inspected Yes No Needs Improvement SLR Notes: Gas Safety Program Procedures (GSPP)- para 4, pp.5 Inspection Performance 3 Did the state inspect all types of operators and inspection units in accordance with time intervals established in its written procedures? (Chapter 5.1) Previous Question B.3 Yes = 2 No = 0 SLR Notes: - GSPP- Page- 5 for natural gas + LPG - 3 year basis LNG- annual basis 2 2 4 Did the state inspection form cover all applicable code requirements addressed on the Federal Inspection forms? (Chapter 5.1 (3)) Previous Question B.4 Yes = 1 No = 0 SLR Notes: GSPP- Appendix B lists Inspeciotn forms used by PUC 1 1 5 Did state complete all applicable portions of inspection forms? (Chapter 5.1 (3)) Previous Question B.5 Yes = 1 No = 0 1 1 SLR Notes: 6 Did the state initiate appropriate follow-up actions to Safety Related Condition Reports? (Chapter 6.3) Previous Question B.6 Yes = .5 No = 0 SLR Notes: DUNS: 002235294 2009 Natural Gas State Program Evaluation .5 NA Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 6#

ME NG Program Evaluation, 2009, page 7In 2009 No SRC 7 Did the state review operator procedures for determining if exposed cast iron pipe was examined for evidence of graphitization and if necessary remedial action was taken? (NTSB) Previous Question B.7 Yes = .5 No = 0 SLR Notes: PUC uses PHMSA form for Distribuiton Gas Operator Inspeciton. This item is reviewed as part of records review .5 .5 8 Did the state review operator procedures for surveillance of cast iron pipelines, including 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) Previous Question B.8 Yes = .5 No = 0 SLR Notes: PUC uses PHMSA form for Distribuiton Gas Operator Inspection. This item is reviewed as part of records review .5 .5 9 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) Previous Question B.9 Yes = .5 No = 0 .5 .5 SLR Notes: 10 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? (NTSB) Previous Question B.10 Yes = 1 No = 0 SLR Notes: GSPP- Appendix D ( see Page numbers 22-25) 1 1 Compliance - 60105(a) States 11 Did the state adequately document sufficient information on probable violations? (Chapter 5.2) Previous 1 .5 Question B.14 Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: Discussed with PUC Certification Attachment 5. PUC needs to diffrentiate and reconcile document information on Probable Violations for Pipeline Safety Parts 192, 193 and Separate for Dig Safe violations unser state damage prevention rules. Attachment 5 only requires state to document Pipeline Safety related Probable Violations by jurisidictional operators. 12 Does the state have written procedures to identify the steps to be taken from the discovery to the resolution of a probable violation as specified in the "Guidelines for State Participating in the Pipeline Safety Program"? (Chapter 5.1) Previous Question D(1).1 Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: GSPP- Appendic C 1 1 13 Does the state have written procedures to notify an operator when a noncompliance is identified as specified in the "Guidelines for States Participating in the Pipeline Safety Program"? (Chapter 5.1(4)) Previous Question D (1).2 Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: GSPP- Appendic C- Para 5- Response Options 1 1 14 Does the state have a written procedure for routinely reviewing the progress of compliance actions to prevent delays or breakdowns of the enforcement process, as required by the "Guidelines for States Participating in the Pipeline Safety Program"? (Chapter 5.1(5)) Previous Question D(1).3 Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: GSPP- Para 7 Commission Action provides various options DUNS: 002235294 2009 Natural Gas State Program Evaluation 1 1 Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 7#

ME NG Program Evaluation, 2009, page 815 Has the State issued compliance actions for all probable violations discovered? (Note : PHMSA representative 1 0 has discretion to delete question or adjust points, as appropriate, based on number of probable violations; any change requires written explanation) Previous Question D(1).4 Yes = 1 No = 0 SLR Notes: Discussed with PUC and suggetsted to recheck/ revise appropriate compliance action to be listed in Attachment 5 of Certification. Review of Attachment 5 shows "zero" Compliance Actions in 2009 but indicated nine (9) Civil penalty items resulting in collection of $10,000. This information not accuarate or consistent and PUC was advised to recheckand revise 16 SLR Notes: Did the state follow its written procedures for reviewing compliance actions and follow-up to determine that prompt corrective actions were taken by operators, within the time frames established by the procedures and compliance correspondence, as required by the "Guidelines for States Participating in the Pipeline Safety Program"? Previous Question D(1).5 Yes = 1 No = 0 Needs Improvement = .5 1 1 17 If compliance could not be established by other means, did state pipeline safety program staff request formal action, such as a "Show Cause Hearing" to correct pipeline safety violations? (check each states enforcement procedures) Previous Question D(1).6 No = 0 Yes = 1 SLR Notes: GSPP- Para 7, Item (b) 1 1 18 Did the state adequately document the resolution of probable violations? (Chapter 5.1 (6)) Previous Question 1 .5 D(1).7 Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: Discused with PUC- Certification Attachment 5- Differentiate Probable Violations by jurisdicitonal Pipeline operators under parts 192/ 193 regulations must be documented and reported to PHMSA. NOPVs discovered for Damage Prevention Activities (for non-pipeline sasfety related) must be counted separate from Attachmnet 5. 19 SLR Notes: Were compliance actions sent to a company officer? (manager or board member if municipal/government system) (Chapter 5.1(4)) Previous Question D(1).8 Yes = .5 No = 0 .5 .5 20 SLR Notes: Did the compliance proceedings give reasonable due process to all parties? (check each states enforcement procedures) Previous Question D(1).9 Yes = 1 No = 0 Needs Improvement = .5 1 1 Compliance - 60106(a) States 21 Did the state use the current federal inspection form(s)? Previous Question D(2).1 Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: 1 NA 22 SLR Notes: Are results adequately documented demonstrating inspection units were reviewed in accordance with state inspection plan? Previous Question D(2).2 Yes = 1 No = 0 Needs Improvement = .5 1 NA 23 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.) Previous Question D(2).3 DUNS: 002235294 2009 Natural Gas State Program Evaluation 1 NA Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 8#

ME NG Program Evaluation, 2009, page 9Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: 24 Did the state immediately report to PHMSA conditions which may pose an imminent safety hazard to the public or to the environment? Previous Question D(2).4 Yes = 1 No = 0 Needs Improvement = .5 1 NA SLR Notes: 25 Did the state give written notice to PHMSA within 60 days of all probable violations found? Previous Question D(2).5 Yes = 1 No = 0 Needs Improvement = .5 1 NA SLR Notes: 26 Did the state initially submit adequate documentation to support compliance action by PHMSA on probable violations? Previous Question D(2).6 Yes = 1 No = 0 Needs Improvement = .5 1 NA SLR Notes: 27 Part B: General Comments/Regional Observations Info Only = No Points Info Only NA SLR Notes: Total points scored for this section: 22.5 Total possible points for this section: 24.5 DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 9#

ME NG Program Evaluation, 2009, page 10PART C - Interstate Agent States Points(MAX) Score 1 Did the state use the current federal inspection form(s)? Previous Question D(3).1 Yes = 1 No = 0 Needs Improvement = .5 1 NA SLR Notes: 2 Are results documented demonstrating inspection units were reviewed in accordance with "PHMSA directed inspection plan"? Previous Question D(3).2 Yes = 1 No = 0 Needs Improvement = .5 1 NA SLR Notes: 3 Did the state submit documentation of the inspections within 60 days as stated in its latest Interstate Agent Agreement form? Previous Question D(3).3 Yes = 1 No = 0 1 NA SLR Notes: 4 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.) Previous Question D(3).4 Yes = 1 No = 0 1 NA SLR Notes: 5 Did the state immediately report to PHMSA conditions which may pose an imminent safety hazard to the public or to the environment? Previous Question D(3).5 Yes = 1 No = 0 Needs Improvement = .5 1 NA SLR Notes: 6 Did the state give written notice to PHMSA within 60 days of all probable violations found? Previous Question D(3).6 Yes = 1 No = 0 SLR Notes: 1 NA 7 Did the state initially submit documentation to support compliance action by PHMSA on probable violations? Previous Question D(3).7 Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: 1 NA 8 Part C: General Comments/Regional Observations Info Only = No Points SLR Notes: ME PUC has only Intrastate state gas jurisdiction. Info Only Info Only Total points scored for this section: 0 Total possible points for this section: 0 DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 10#

ME NG Program Evaluation, 2009, page 11PART D - Incident Investigations Points(MAX) Score 1 Are state personnel following the procedures for Federal/State cooperation in case of an incident? (See Appendix in "Guidelines for States Participating in the Pipeline Safety Program") (Chapter 6.1) Previous Question E.1 Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: 1 1 2 Are state personnel familiar with the jurisdictional authority and Memorandum of Understanding between NTSB and PHMSA? (See Appendix in "Guidelines for States Participating in the Pipeline Safety Program") (Chapter 6 ? Appendix D) Previous Question E.2 Yes = .5 No = 0 SLR Notes: .5 .5 3 Did the state keep adequate records of incident notifications received? Previous Question E.3 Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: No Reportable Gas Incidents in 2009 1 NA 4 If an onsite investigation of an incident was not made, did the state obtain sufficient information by other means to determine the facts and support the decision not to go on-site? Previous Question E.4 Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: No reportable gas incidents in 2009 1 NA 5 Were investigations thorough and conclusions and recommendations documented in an acceptable manner? Previous Question E.5, comprehensive question worth 2 points total Yes = 2 No = 0 Needs Improvement = 1 a. Observations and Document Review b. Contributing Factors c. Recommendations to prevent recurrences where appropriate SLR Notes: No reportable gas incidents in 2009 2 NA Yes No Needs Improvement Yes No Needs Improvement Yes No Needs Improvement 6 Did the state initiate enforcement action for violations found during any incident investigation(s)? Previous Question E.6 Variation Yes = 1 No = 0 Needs Improvement = .5 SLR Notes: No reportable gas incidents in 2009 1 NA 7 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 annual report data from operators concerning incidents/accidents and investigate discrepancies) (Chapter 6) Previous Question E.7/E.8 Yes = .5 No = 0 SLR Notes: No reportable gas incidents in 2009 .5 NA 8 Part D: General Comments/Regional Observations Info Only = No Points SLR Notes: No reportable gas incidents in 2009 Info Only Info Only DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 11#

ME NG Program Evaluation, 2009, page 12Total points scored for this section: 1.5 Total possible points for this section: 1.5 DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 12#

ME NG Program Evaluation, 2009, page 13PART E - Damage Prevention Initiatives Points(MAX) Score 1 Has the state reviewed directional drilling/boring procedures of each pipeline operator or its contractor to determine if they include actions to protect their facilities from the dangers posed by drilling and other trench less technologies? Previous Question B.11 Yes = 2 No = 0 Needs Improvement = 1 2 2 SLR Notes: ME PUC has actively reviewed HDD and worked with operators/ contractors as part of Damage Prevention efforts. 2 Did the state inspector check to assure the pipeline operator is following its written procedures pertaining to notification of excavation, marking, positive response and the availability and use of the one call system? New 2008 Yes = 2 No = 0 2 2 SLR Notes: ME has very strong Damage Prevention Program. PUC verifies One Call Procedures for excavation, markouts and positive response. 3 Did the state encourage and promote the adoption of the Common Ground Alliance Best Practices document to its regulated companies as a means of reducing damages to all underground facilities? Previous Question A.7 Yes = 2 No = 0 Needs Improvement = 1 2 2 SLR Notes: ME has encouraged and strongly supported damage Prevention efofrts including CGA. 4 Has the agency or another organization within the state collected data and evaluated trends on the number of pipeline damages per 1,000 locate requests? New 2008 Yes = 1 No = 0 1 1 SLR Notes: ME PUC collects and analyzes damage prevention data including per 1000 locate requests. 5 Did the state review operators' records of accidents and failures due to excavation damage to ensure causes of failure are addressed to minimize the possibility of recurrence as required by 192.617? Yes = 2 No = 0 2 2 SLR Notes: PUC actively reviews operator data to minimize damage form excavation activitieis and possibility of recurrence per 192.617 6 Part E: General Comments/Regional Observations Info Only = No Points Info Only Info Only SLR Notes: Total points scored for this section: 9 Total possible points for this section: 9 DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 13#

ME NG Program Evaluation, 2009, page 14PART F - Field Inspection Points(MAX) Score 1 Operator, Inspector, Location, Date and PHMSA Representative Info Only = No Points Name of Operator Inspected: Maine Natural Gas Name of State Inspector(s) Observed: Gary Kenny Location of Inspection: Brunswick Date of Inspection: 06/25/2010 Name of PHMSA Representative: Dino N. Rathod SLR Notes: Review of O&M- Procedures and selected records Pr Reg Staion Maintenance; OQ Manual and Construction in Topsham. Info Only Info Only 2 Was the operator or operator's representative notified and/or given the opportunity to be present during inspection? New 2008 Yes = 1 No = 0 SLR Notes: MNG inspector was present at job site 1 1 3 Did the inspector use an acceptable inspection form/checklist and was the form/checklist used as a guide for the inspection? (New regulations shall be incorporated) Previous Question F.2 Yes = 2 No = 0 SLR Notes: ME PUC inspector used construciton check list as a guide. 2 2 4 Did the inspector thoroughly document results of the inspection? Previous Question F.3 Yes = 2 No = 0 SLR Notes: PUC used inspection check list and OQ protocol # 9 to document inspection observations. 2 2 5 Did the inspector check to see if the operator had necessary equipment during inspection to conduct tasks viewed? (Maps, pyrometer, soap spray, CGI, etc.) New 2008 Yes = 1 No = 0 SLR Notes: Gary Kenny checked MNGs contractor ETTI installing 4-inch new plastic pipe. He verified that ETTI had proper tools, maps etc. 1 1 6 What type of inspection(s) did the state inspector conduct during the field portion of the state evaluation? (i.e. Standard, Construction, IMP, etc) New 2008 Info Only = No Points Info Only Info Only SLR Notes: Pressure Reg Station Procedures and selected Records review and observed field maintenance at George E Bonner Pr Reg Sta in Bowdon, ME. In addition, observed installation of 4-in Polypipe in Topsham. Crew was also performing horizontal directional drilling. 7 Did the inspector adequately review the following during the field portion of the state evaluation? (check all that apply on list) New 2008, comprehensive question worth 2 points total Yes = 2 No = 0 Needs Improvement = 1 2 2 a. Procedures b. Records c. Field Activities/Facilities d. Other (Please Comment) SLR Notes: DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 14#

ME NG Program Evaluation, 2009, page 158 Did the inspector have adequate knowledge of the pipeline safety program and regulations? (Liaison will document reasons if unacceptable) Previous Question F.8 Yes = 2 No = 0 2 2 SLR Notes: 9 Did the inspector conduct an exit interview? (If inspection is not totally complete the interview should be based on areas covered during time of field evaluation) Previous Question F.10 Yes = 1 No = 0 SLR Notes: Gary Kenny conveyed his observations and concerns during an exit interview. 1 1 10 During the exit interview, did the inspector identify probable violations found during the inspections? Previous Question F.11 Yes = 1 No = 0 SLR Notes: No major issues were found. However PUC will follow-up on concerns expressed duirng this field eval trip 1 1 11 What did the inspector observe in the field? (Narrative description of field observations and how inspector Info Only Info Only performed) Info Only = No Points SLR Notes: Operator: Maine Natural Gas Location: Brunswick PUC Inspector: Gary Kenny Gary reviewed selected O&M procedures and records pertaining to Pressure Reg Station maintenance. He expressed concern for lack of clarity of when O&M manual as well as OQ Plan Manual were updated and who was in-charge of performing this task. Question came up if MNG performed O&M review in 2009 and failed to provide supporting documentation to PUC. Gary agreed to follow-up. Construciton: MNG-Contarctor ETTI Location: Hillcrest Lane and Foreside, Topsham ETTI crew was in process of installing new 4-inch Polypipe (Yellowpipe), SDR 13.5 PE 3406/2708. Pipe was to be tested to 90 psi. Gary checked OQ fusion qualifications, heating iron temp and pipe on-site storage. He also verified validity of Dig Safe Ticket. One call mark-outs were visible. Issue of improper alignment of butt fusion resulted in cut out of completed buu fusion joints. PUC was to follow-up on this issues also. Pressure Reg StationMaintenance George E Bonner Station, Bowdon Gary observed routine annual maintenance activities of two MNG employees. He also performed QO # 9 at this location 12 Best Practices to Share with Other States - (Field - could be from operator visited or state inspector practices) Info Only Info Only = No Points SLR Notes: PUC shares with other states at ER and NEPSR meetings. Info Only 13 Field Observation Areas Observed (check all that apply) 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 Info Only Info Only DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 15#

ME NG Program Evaluation, 2009, page 16k. 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 A. 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 SLR Notes: 14 Part F: General Comments/Regional Observations Info Only = No Points SLR Notes: DUNS: 002235294 2009 Natural Gas State Program Evaluation Info Only Info Only Total points scored for this section: 12 Total possible points for this section: 12 Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 16#

ME NG Program Evaluation, 2009, page 17PART G - PHMSA Initiatives - Strategic Plan Points(MAX) Score Risk base Inspections - Targeting High Risk Areas 1 Does state have process to identify high risk inspection units? Yes = 1.5 No = 0 1.5 1.5 Risk Factors (criteria) to consider may include: Miles of HCA's, Geographic area, Population Density Length of time since last inspection History of Individual Operator units (leakage, incident and compliance history, etc.) Threats - (Excavation Damage, Corrosion, Natural Forces, Other Outside Forces, Material or Welds, Equipment, Operations, Other) SLR Notes: ME PUC Gas Safety Procedures page 7; PUC performed distribution gas transmission IMP inspection of bangor GAs in June 2008; PUC used federal IMP protocols as part of inpsection process for performing this IMP inspection and uploaded data in IMDB. Protocol A covered HCA and other considerations. 2 Are inspection units broken down appropriately? (see definitions in Guidelines) Yes = .5 No = 0 .5 0.5 SLR Notes: 3 Consideration of operators DIMP Plan? (if available and pending rulemaking) Info Only = No Points SLR Notes: PUC intends to review DIMP implementation plans by jurisdictional operators prior to Aug 2011. Info Only Info Only 4 Does state inspection process target high risk areas? Yes = .5 No = 0 SLR Notes: PUC uses IMP Protocols for operators IMP plan review, targetting High Risk Areas. .5 0.5 Use of Data to Help Drive Program Priority and Inspections 5 Does state use data to analyze effectiveness of damage prevention efforts in the state? (DIRT or other data, etc) .5 0.5 Yes = .5 No = 0 SLR Notes: various stakeholders. ME PUC maintains Damage Data since 2000 and analyzes for a stronger damage prevention program. PUC also offers damage prevention training to 6 Has state reviewed data on Operator Annual reports for accuracy? Yes = .5 No = 0 SLR Notes: PUC reviews operator reports for accuracy and closely works with PHMSA. .5 0.5 7 Has state analyzed annual report data for trends and operator issues? Yes = .5 No = 0 .5 0.5 SLR Notes: Northern Utilities' model for the evaluation of cast iron and bare steel pipe was reviewed by PUC as part of the proceedings of docket 2008-151 regarding the replacement of their CI and BS pipe. 8 Has state reviewed data on Incident/Accident reports for accuracy? Yes = .5 No = 0 SLR Notes: DUNS: 002235294 2009 Natural Gas State Program Evaluation .5 0.5 Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 17#

ME NG Program Evaluation, 2009, page 18No reportable gas incidents in 2009. However, in CY 2007, ME PUC worked closely with PHMSA and also reviewed Saco incident details for accuracy. 9 Does state do evaluation of effectiveness of program based on data? (i.e. performance measures, trends, etc.) .5 0.5 Yes = .5 No = 0 SLR Notes: The PUC analyzes gas operators leak progression data and bare steel and cast iron replacement considerations. PUC also tracks and evaluates excavation damage data and takes appropriate enforcement actions 10 Did the State input all operator qualification inspection results into web based database provided by PHMSA in a timely manner upon completion of OQ inspections? Previous Question B.15 Yes = .5 No = 0 SLR Notes: For 2009, PUC completed 26 OQ inspections and OQ data was uploaaded in federal database. .5 0.5 11 Did the State submit their replies into the Integrity Management Database (IMDB) in response to the Operators notifications for their integrity management program? Previous Question B.16 Yes = .5 No = 0 SLR Notes: Only Bangor Gas has facilities subject to IMP rules. PUC has no record of submittal replies in to IMDB. .5 0 12 Have the IMP Federal Protocol forms been uploaded to the IMDB? Previous Question B.17 .5 0.5 Yes = .5 No = 0 SLR Notes: In 2008 PUC performed 3 IMP inspections of Bangor Gas and uploaded in IMDB. PUC intends to perform IMP inspection(s) during CY 2010. 13 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? Previous Question B.18 Yes = .5 No = 0 .5 0 SLR Notes: PUC checked for current information and indicated of no records of asking operators for plastic pipe defects etc. No records to subtantiate it 14 Has state confirmed transmission operators have submitted information into National Pipeline Mapping System (NPMS) database along with any changes made after original submission? Yes = .5 No = 0 SLR Notes: PUC was unable to confirm information. No records to subtantiate it. .5 0 Accident/Incident Investigation Learning and Sharing Lessons Learned 15 Has state shared lessons learned from incidents/accidents? (i.e. NAPSR meetings and communications) Yes = .5 No = 0 SLR Notes: PUC made a presentation at NEPSR Oct 2009 an shared several issues related to NOPV issued to NUI. .5 0.5 16 Does the State support data gathering efforts concerning accidents? (Frequency/Consequence/etc) .5 NA Yes = .5 No = 0 SLR Notes: In previous years PUC supported data gathering and worked closely with PHMSA. PUC had no reportable incidnet in CY 2009 17 SLR Notes: Does state have incident/accident criteria for conducting root cause analysis? Info Only = No Points Info Only Info Only DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 18#

ME NG Program Evaluation, 2009, page 1918 Does state conduct root cause analysis on incidents/accidents in state? Info Only = No Points Info Only Info Only SLR Notes: 19 Has state participated on root cause analysis training? (can also be on wait list) Yes = .5 No = 0 .5 0.5 SLR Notes: Gary Kenny was waitlisted and scheduled to take Root Cause Analysis Training in Sept 2010 Transparency - Communication with Stakeholders 20 Other than pipeline safety seminar does State communicate with stakeholders? (Communicate program data, pub awareness, etc.) Yes = .5 No = 0 .5 0.5 SLR Notes: 1 PUC shares pertinent Pipeline Safety realted information with LDCs 2. PUC conducted several meeting with LPG operators 21 Does state share enforcement data with public? (Website, newsletters, docket access, etc.) Yes = .5 No = 0 .5 0.5 SLR Notes: ME Govt website PUC Gas Safety hava a Public website access- Virual Case File. ww.maine.gov/mpuc also provides News Relase eg for Dig Safe Program 22 Part G: General Comments/Regional Observations Info Only = No Points Info Only Info Only SLR Notes: Total points scored for this section: 8 Total possible points for this section: 9.5 DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 19#

ME NG Program Evaluation, 2009, page 20PART H - Miscellaneous Points(MAX) Score 1 What were the major accomplishments for the year being evaluated? (Describe the accomplishments, NAPSR Activities and Participation, etc.) Yes = .5 No = 0 .5 0.5 SLR Notes: 1 Sept 2009 ME PUC hired a permanent Program Manager- Gary Kenny to fill vacancy caused by Gary Farmer's retirement in June 2009 2 What legislative or program initiatives are taking place/planned in the state, past, present, and future? (Describe initiatives (i.e. damage prevention, jurisdiction/authority, compliance/administrative, etc.) Yes = .5 No = 0 .5 0.5 SLR Notes: 1 Stakeholder meetings were help to review possible reviosn to Dig Safe regs. 2. PUC initiated Draft Revision to jurisdictional propane systems and Gas Rules 3 Any Risk Reduction Accomplishments/Projects? (i.e. Cast iron replacement projects,bare steel,third-party damage reductions, etc.) Yes = .5 No = 0 .5 0.5 SLR Notes: Cast Iron and bare steel replacement contiunues; NUI achieving damage reduction due to switch to In-house locating 4 Did the state participate in/respond to surveys or information requests from NAPSR or PHMSA? Yes = 1 No = 0 1 1 SLR Notes: PUC has responded to NAPSR and PHMSA requests 5 Sharing Best Practices with Other States - (General Program) Yes = .5 No = 0 .5 0.5 SLR Notes: ME PUC shared best practices at NAPSR and NEPSR meetings with various stakeholders 6 Part H: General Comments/Regional Observations Info Only = No Points Info Only Info Only SLR Notes: Total points scored for this section: 3 Total possible points for this section: 3 DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 20#

ME NG Program Evaluation, 2009, page 21PART I - Program Initiatives Points(MAX) Score Drug and Alcohol Testing (49 CFR Part 199) 1 Has the state verified that operators have drug and alcohol testing programs? Yes = 1 No = 0 SLR Notes: PUC verified D&A Program of NUI in 2007, Bangor GAs May 2008 and Maine Natural Gas in April 2009. 1 1 2 Is the state verifying that operators are conducting the drug and alcohol tests required by the operators program (random, post-incident, etc.) Yes = .5 No = 0 .5 0.5 SLR Notes: tests per their plans. PUC verified D&A Program of NUI in 2007, Bangor Gas May 2008 and Maine Natural Gas in April 2009. PUC verified that LDCs were conducting D&A 3 Is the state verifying that any positive tests are responded to in accordance with the operator's program? Yes = .5 No = 0 .5 0.5 SLR Notes: Qualification of Pipeline Personnel (49 CFR Part 192 Subpart N) 4 Has the state verified that operators have a written qualification program? Yes = 1 No = 0 SLR Notes: PUC used federal OQ Protocols 1 thru 9 and verified that LDCs have Writen OQ Plans. 1 1 5 Has the state reviewed operator qualification programs for compliance with PHMSA rules and protocols? Yes = .5 No = 0 SLR Notes: PUC used federal OQ Protocols 1 thru 9 and verified that LDCs have Written OQ Plans. .5 0.5 6 Is the state verifying that persons who perform covered tasks for the operator are qualified in accordance with the operator's program? Yes = .5 No = 0 .5 0.5 SLR Notes: federal OQDB. PUC used federal OQ Protocols 1 thru 9 and verified that LDCs have Written OQ Plans. PUC has performed OQ field verifications and uploaded results in 7 Is the state verifying that persons who perform covered task for the operator are requalified at the intervals specified in the operator's program? Yes = .5 No = 0 SLR Notes: PUC used federal OQ Protocols 1 thru 9 and verified that LDCs requalification per Written OQ Plans. .5 0.5 Gas Transmission Pipeline Integrity Management (49 CFR Part 192 Subpart O) 8 Has the state verified that all operators with transmission pipelines have either adopted an integrity management program (IMP), or have properly determined that one is not required? Yes = 1 No = 0 1 1 SLR Notes: ME PUC performed IMP verification of MNG and Bangor Gas. MNG does not have an HCAs. PUC performed IMPusing IMP protocols duirng May 2008. 9 Has the state verified that in determining whether a plan is required, the operator correctly calculated the potential impact radii and properly applied the definition of a high consequence area? Yes = .5 No = 0 SLR Notes: DUNS: 002235294 2009 Natural Gas State Program Evaluation .5 0.5 Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 21#

ME NG Program Evaluation, 2009, page 22PUC has verified IMP related details including need for correctly calculated impact radii. (also see previous answer in I-8). 10 Has the state reviewed operator IMPs for compliance with Subpart O? (In accordance with State Inspection plan) Yes = .5 No = 0 SLR Notes: PUC reviewed IMP plan on May 2008 of Bangor Gas. No IMP review was performed in 2009 .5 0.5 11 Is the state monitoring operator progress on the inspections, tests and remedial actions required by the operator's IMP, including that they are being done in the manner and schedule called for in its IMP? Yes = .5 No = 0 SLR Notes: PUC reviewed IMP plan on May 2008 of Bangor Gas. No IMP review was performed in 2009 .5 0.5 12 Is the state verifying that operators are periodically examining their transmission line routes for the appearance of new HCAs? Yes = .5 No = 0 SLR Notes: PUC reviewed IMP plan on May 2008 of Bangor Gas. No IMP review was performed in 2009 .5 0.5 Public Awareness (49 CFR Section 192.616) 13 Has the state verified that each operator has developed a continuing public awareness program? (due date was 6/20/06 for most operators, 6/20/07 for certain very small operators,6/13/08 for master meters) Yes = .5 No = 0 SLR Notes: PUC reviewed Public Awareness Proram plan review in 2006-2008 .5 0.5 14 Has the state reviewed the content of these programs for compliance with 192.616 (by participating in the Clearinghouse or by other means)? Yes = .5 No = 0 SLR Notes: Norhteast Gas Association (NGA) plan was reviewed by clearinghose for compliance with 192.616. .5 0.5 15 Is the state verifying that operators are conducting the public awareness activities called for in its program? Yes = .5 No = 0 SLR Notes: PUC conducted Public Awareness Proram activities review of Bangor Gas in Feb 2009, no issues were found. .5 0.5 16 Is the state verifying that operators have evaluated their Public Awareness programs for effectiveness as described in RP1162? Info Only = No Points Info Only Info Only SLR Notes: PUC has not verified that this activity occurred in CY 2009 or previously. PUC was advised and will review and evaluate operator's Public Awareness program for effectiveness during CY 2010. 17 Part I: General Comments/Regional Observations Info Only = No Points SLR Notes: Info Only Info Only Total points scored for this section: 9 Total possible points for this section: 9 DUNS: 002235294 2009 Natural Gas State Program Evaluation Maine MAINE PUBLIC UTILITIES COMMISSION, Page: 22#