2015 OR NG Program Evaluation - or2015ngprogramevaluation (Oregon; Natural Gas State Program Evaluation)

OR NG Program Evaluation, 2015, page 1Official PDF1200 New Jersey Avenue SE Washington DC 20590 U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 2015 Gas State Program Evaluation for OREGON PUC 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: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 1#

OR NG Program Evaluation, 2015, page 22015 Gas State Program Evaluation -- CY 2015 Gas State Agency: Oregon Rating: Agency Status: Date of Visit: 04/18/2015 - 04/21/2015 Agency Representative: Kevin Hennessy, Chief Pipeline Safety PHMSA Representative: David Lykken, David Appelbaum Commission Chairman to whom follow up letter is to be sent: Name/Title: Susan Ackerman, Chair Agency: Oregon Public Utilities Commission Address: PO Box 1088 City/State/Zip: Salem, OR 97308-1088 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 2015 (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 13 13 C Program Performance 48 48 D Compliance Activities 15 15 E Incident Investigations 10 10 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 116 116 State Rating................................................................................................................................................... 100.0 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 2#

OR NG Program Evaluation, 2015, page 3PART A - Progress Report and Program Documentation Review Points(MAX) Score 1 Accuracy of Jurisdictional Authority and Operator/Inspection Units Data - Progress Report Attachment 1 Yes = 1 No = 0 Needs Improvement = .5 1 1 Evaluator Notes: Yes. Letter dated 5/11/2015 affirming jurisdictional authority received. Operator/Inspection unit information reviewed. 2 Review of Inspection Days for accuracy - Progress Report Attachment 2 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: No issues noted. Days align with inspection reports reviewed. 1 1 3 Accuracy verification of Operators and Operators Inspection Units in State - Progress Report Attachment 3 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Operator information aligns with data found in Data Mart. No issues noted. 1 1 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: Yes. Safety Related Condition reported as incident. LNG plant - ESD shut down due to power failure. Shutdown not a result of an actual emergency. 5 Accuracy verification of Compliance Activities - Progress Report Attachment 5 1 1 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Data appears correct. No issues noted. 6 Were pipeline program files well-organized and accessible? - Progress Report Attachment 6 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes. All files readily available and well organized. 2 2 7 Was employee listing and completed training accurate and complete? - Progress Report Attachment 7 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes. Newest inspector on track to complete core classes within the required time frame. 1 1 8 Verification of Part 192,193,198,199 Rules and Amendments - Progress Report Attachment 8 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: 1 1 No issues noted. Legislation passed and rules adopted increasing civil penalties to 200K/2Mil. OAR 860-031-0035. 9 List of Planned Performance - Did state describe accomplishments on Progress Report in detail - Progress Report Attachment 10 1 1 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 3#

OR NG Program Evaluation, 2015, page 4Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes. No issues noted. 10 General Comments: Info Only = No Points Evaluator Notes: Info Only Info Only Total points scored for this section: 10 Total possible points for this section: 10 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 4#

OR NG Program Evaluation, 2015, page 5PART 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: Revised inspection procedures taken from Appendix S of PHMSA state program guidelines. Has also included state specific processes. 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: Revised inspection procedures taken from Appendix S of PHMSA state program guidelines. Has also included state specific processes for conducting IMP and DIMP inspections. 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: Revised inspection procedures taken from Appendix S of PHMSA state program guidelines. Has also included state specific processes for conducting OQ inspections. 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: Revised inspection procedures taken from Appendix S of PHMSA state program guidelines. Has also included state specific processes for conducting Damage Prevention inspections. 5 Any operator training conducted should be outlined and appropriately documented as needed. Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: No issues noted. 1 1 6 Construction Inspection procedures should give guidance to state inspectors that 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: Newly revised inspection procedures gleaned from Appendix S of PHMSA state program guidelines. 1 1 7 Does inspection plan address inspection priorities of each operator, and if necessary each unit, based on the following elements? Yes = 6 No = 0 Needs Improvement = 1-5 6 6 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 5#

OR NG Program Evaluation, 2015, page 6a. 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: Yes. Newly revised inspection procedures gleaned from Appendix S of PHMSA state program guidelines. Has also included state specific processes. 8 General Comments: Info Only Info Only Info Only = No Points Evaluator Notes: As noted previously,revised inspection procedures gleaned from Appendix S of PHMSA state program guidelines. Recommended as part of CY2014 program evaluation. Total points scored for this section: 13 Total possible points for this section: 13 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 6#

OR NG Program Evaluation, 2015, 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 Yes = 5 No = 0 A. Total Inspection Person Days (Attachment 2): 389.50 B. Total Inspection Person Days Charged to the Program (220 X Inspection Person Years) (Attachment 7): 220 X 3.85 = 847.00 Ratio: A / B 389.50 / 847.00 = 0.46 If Ratio >= 0.38 Then Points = 5, If Ratio < 0.38 Then Points = 0 Points = 5 Evaluator Notes: 389.5 field days achieved. No issues noted. 5 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: Tracker created for inspection staff to ensure course requirements are met. L. Hazelton on track to complete core courses within the required timeframes. Recommended that L. Hazelton attend the new T&Q PL3322 OQ course. 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: Kevin has done a good job in his personal development since becoming program manager. He has developed and implemented processes and procedures reflective of his vision to advance pipeline safety. 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 Evaluator Notes: Yes. PHMSA letter dated 7/08/2015. Response date 9/1/2015. Deficiencies corrected. 2 2 5 Did State hold PHMSA TQ Seminar in Past 3 Years? Chapter 8.5 Yes = 2 No = 0 Evaluator Notes: Yes. WA hosted tri-state (ID, WA, OR) gas seminar in Pasco, WA in May 2015. 2 2 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 Evaluator Notes: DUNS: 933144107 2015 Gas State Program Evaluation 5 5 Oregon OREGON PUC, Page: 7#

OR NG Program Evaluation, 2015, page 8Yes. Tracker developed ensuing that all operators and inspection units are within 5 year time frames established. Typically completed within 3 years. per documentation reviewed. 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. Program utilizes PHMSA inspection forms for all inspection types. Forms completed in their entirety. Inspectors do good job documenting findings. 8 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) Chapter 5.1 Yes = 1 No = 0 Evaluator Notes: N/A. No CI remaining in OR 1 NA 9 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) Chapter 5.1 Yes = 1 No = 0 Evaluator Notes: N/A. No CI remaining in OR 1 NA 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 Yes = 1 No = 0 Evaluator Notes: Yes. No issues noted. 1 1 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: Yes. No issues noted. 1 1 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. Spreadsheet created utilizing raw data from operator annual and incident reports. Utilizes spreadsheet to conduct analysis and assist in developing annual inspection work plan and targeting areas of emphasis. 13 Did state input all applicable OQ, DIMP/IMP inspection results into federal database in a timely manner? This includes replies to Operator notifications into IMDB database. Chapter 5.1 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes. 2 2 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 8#

OR NG Program Evaluation, 2015, page 914 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 Evaluator Notes: No issues noted 1 1 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 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes. 13 D&A inspections conducted in CY2015. 2 2 16 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. Written plans reviewed not to exceed five years. Conduct regular field verification of operator and contractor employee qualifications. Completed OQ forms uploaded in to OQDB. 17 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). 49 CFR 192 Subpart 0 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes. No issues noted. Written plans reviewed not to exceed five years. Conduct regular field verification of operator remediation activities. 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 have been complete by December 2014 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: 2 2 Yes. Written plans reviewed not to exceed five years. Conducts regular field verification of operator remediation activities. 19 Is state verifying operators Public Awareness programs are up to date and being 2 2 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 conducted every four years per RP1162 Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes. Written plans reviewed not to exceed five years. Verification of PA activities conducted during comprehensive standard inspections. 20 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: Program chief schedules regular one on one visits with operators to discuss issues and concerns. Utilize agency web site to DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 9#

OR NG Program Evaluation, 2015, page 10post enforcement actions, Penalty assessments, one-call information. Inspections records made available via public records requests. 21 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: Yes. One SRC in CY2015. Report ID: 20150112. Closed on 10/14/15. 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? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes. Data collected from each of the LDC's. 1 1 23 Did the state participate in/respond to surveys or information requests from NAPSR or PHMSA? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes. Email documentation. Also during NAPSR western regional meeting in 2015. 1 1 24 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: No waivers issued in CY2015. One open waiver dating back to 2012. Operator has not yet utilized approved waiver. Mr. Hennessy to follow up with operator. 25 Did the state attend the National NAPSR Board of Directors Meeting in CY being evaluated? No = 0 Needs Improvement = .5 Yes = 1 Evaluator Notes: Yes. Attended 2015 meeting held in Tempe, AZ. 1 1 26 Discussion on State Program Performance Metrics found on Stakeholder Communication 2 2 site - http://primis.phmsa.dot.gov/comm/states.htm No = 0 Needs Improvement = 1 Yes = 2 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: Discussed metrics although CY2015 data not yet made available from PHMSA at time of this program evaluation. 27 General Comments: Info Only = No Points Evaluator Notes: Info Only Info Only Total points scored for this section: 48 Total possible points for this section: 48 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 10#

OR NG Program Evaluation, 2015, 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 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. Procedures revised and implemented after CY2014 program evaluation. No issues. 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 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. Were applicable civil penalties outlined in correspondence with operator(s) Yes No Needs Improvement Evaluator Notes: Inspection findings sent to appropriate company officers. Probable violations and supporting evidence well documented. Needed improvement for item e. Applicable civil penalties not typically outlined during initial correspondence. Outlined only when level of the enforcement action is escalated. Will need to make sure response options included with civil penalty levels the operator is subject to. No point deduction for CY2016 evaluation. 3 Did the state issue compliance actions for all probable violations discovered? Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes. No issues noted. 2 2 4 Did compliance actions give reasonable due process to all parties? Including "show cause" hearing if necessary. Yes = 2 No = 0 Evaluator Notes: Yes. 2 2 5 Is the program manager familiar with state process for imposing civil penalties? Were 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: Program manager is familiar. No civil penalties assessed in CY2015. 2 2 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: Has issued civil penalties in the past. None in 2015. 1 1 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 11#

OR NG Program Evaluation, 2015, page 127 General Comments: Info Only = No Points Evaluator Notes: Info Only Info Only Total points scored for this section: 15 Total possible points for this section: 15 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 12#

OR NG Program Evaluation, 2015, page 13PART 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: program. Revised procedures taken from Appendix S of state program guidelines. Additional processes incorporated unique to state 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: 24Hr incident notification number in use. Records adequate. 3 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 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Operator reported ESD shut down at a LNG facility not related to an actual emergency. No damage to LNG facility or property. 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: One reportable incident in 2015. Operator reported ESD shut down at a LNG facility not related to an actual emergency. No damage to LNG facility or property. Investigated and documented. No issues noted. No violations identified. 5 Did the state initiate compliance action for violations found during any incident/accident 1 NA investigation? Yes = 1 No = 0 Evaluator Notes: N/A. No compliance action required. No violations identified. Operator reported ESD shut down at a LNG facility not related to an actual emergency. No damage to LNG facility or property. Investigated and documented. No issues noted. 6 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 Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: Yes. No issues noted. 1 1 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 13#

OR NG Program Evaluation, 2015, page 147 Does state share lessons learned from incidents/accidents? (sharing information, such as: at NAPSR Region meetings, state seminars, etc) Yes = 1 No = 0 Evaluator Notes: 1 1 Yes. Typically during state of the state report during NAPSR regional and national meetings. 8 General Comments: Info Only = No Points Evaluator Notes: Info Only Info Only Total points scored for this section: 10 Total possible points for this section: 10 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 14#

OR NG Program Evaluation, 2015, page 15PART F - Damage Prevention 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? NTSB Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Reviewed as part of operator plans and procedures review. 2 2 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? Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes. As part of a comprehensive damage prevention program review. 2 2 3 Did the state encourage and promote practices for reducing damages to all underground 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. No issues noted. 2 2 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? (This can include DIRT and other data shared and reviewed by the pipeline safety program) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: 2 2 Via data collected from company annual reports. Exceptional job tracking and trending utilizing data collected. 5 General Comments: Info Only = No Points Evaluator Notes: Info Only Info Only Total points scored for this section: 8 Total possible points for this section: 8 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 15#

OR NG Program Evaluation, 2015, 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: Cascade Natural Gas Corporation Name of State Inspector(s) Observed: John Ivey, Cody Cox Location of Inspection: Communities of Bend and Prineville, OR Date of Inspection: 4/18/2016 & 4/20/2016 Name of PHMSA Representative: David Lykken, David Appelbaum Evaluator Notes: Comprehensive standard inspection of CNG's Bend, OR inspection unit. Documentation review and field observation of inspection and testing of pressure regulator facilities. 2 Was the operator or operator's representative notified and/or given the opportunity to be present during inspection? Yes = 1 No = 0 Evaluator Notes: Yes. 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) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes. PHMSA IA Equivalent Gas Distribution form used. 2 2 4 Did the inspector thoroughly document results of the inspection? Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes. No issues noted. 2 2 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.) Yes = 1 No = 0 Evaluator Notes: Yes. Equipment used by technician reviewed. Calibration dates checked on pressure gages used for conducting maintenance checks. 2 2 6 Did the inspector adequately review the following during the field portion of the state evaluation? (check all that apply on list) Yes = 2 No = 0 Needs Improvement = 1 a. Procedures b. Records c. Field Activities d. Other (please comment) Evaluator Notes: Inspector had copies of company procedures and facility maintenance & inspection records from in hand during field observations. OQ records reviewed during office records review. DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 16#

OR NG Program Evaluation, 2015, page 177 Did the inspector have adequate knowledge of the pipeline safety program and regulations? (Evaluator will document reasons if unacceptable) Yes = 2 No = 0 Needs Improvement = 1 Evaluator Notes: Yes. No issues noted. 2 2 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) Yes = 1 No = 0 Evaluator Notes: Inspection not totally completed. No issues noted during portion of office record review observed and pressure regulation station maintenance checks observed. 9 During the exit interview, did the inspector identify probable violations found during the inspections? (if applicable) Yes = 1 No = 0 Evaluator Notes: No violations noted during portion of inspection observed. 1 1 10 General Comments: 1) What did the inspector observe in the field? (Narrative description of field observations and how inspector performed) 2) Best Practices to Share with Other States - (Field - could be from operator visited or state inspector practices) 3) 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 A. Repairs B. Signs C. Tapping Info Only Info Only DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 17#

OR NG Program Evaluation, 2015, page 18D. Valve Maintenance E. Vault Maintenance F. Welding G. OQ - Operator Qualification H. Compliance Follow-up I. Atmospheric Corrosion J. Other Evaluator Notes: Comprehensive standard inspection of CNG's Bend, OR inspection unit. Documentation review and field observation of inspection and testing of pressure regulator facilities. Mr. Ivey and Mr. Cox were knowledgeable and competent and conducted the inspections in a courteous and professional manner. No issues noted. Total points scored for this section: 12 Total possible points for this section: 12 DUNS: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 18#

OR NG Program Evaluation, 2015, page 19PART H - Interstate Agent State (If Applicable) Points(MAX) Score 1 Did the state use the current federal inspection form(s)? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A 1 NA 2 Are results documented demonstrating inspection units were reviewed in accordance with "PHMSA directed inspection plan"? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A 1 NA 3 Did the state submit documentation of the inspections within 60 days as stated in its latest Interstate Agent Agreement form? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A 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.) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A 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? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A 1 NA 6 Did the state give written notice to PHMSA within 60 days of all probable violations found? Evaluator Notes: N/A Yes = 1 No = 0 Needs Improvement = .5 1 NA 7 Did the state initially submit documentation to support compliance action by PHMSA on probable violations? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A 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: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 19#

OR NG Program Evaluation, 2015, page 20PART I - 60106 Agreement State (If Applicable) Points(MAX) Score 1 Did the state use the current federal inspection form(s)? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A. Not a 60106 program. 1 NA 2 Are results documented demonstrating inspection units were reviewed in accordance with state inspection plan? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A. Not a 60106 program. 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.) Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A. Not a 60106 program. 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? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A. Not a 60106 program. 1 NA 5 Did the state give written notice to PHMSA within 60 days of all probable violations found? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A. Not a 60106 program. 1 NA 6 Did the state initially submit adequate documentation to support compliance action by PHMSA on probable violations? Yes = 1 No = 0 Needs Improvement = .5 Evaluator Notes: N/A. Not a 60106 program. 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: 933144107 2015 Gas State Program Evaluation Oregon OREGON PUC, Page: 20#