@ 400 SeventhStreet,S.W. Washington, D.C.20590 U.S. Department of Tronsportqlion Pipellne ond Hozol'tiou3 llotedols sotefy ldmlnlsrotlon JAN.3 M6 Mr. PaulS. Broker Vice President Mid-ValleyPipelineCompany 907 SouthDetroit Avenue Tulsa,OK 74120 -5022 Re: CPFNo. 3-2003 DearMr. Broker: for Administrator PipelineSafetyin by Enclosed the Final Orderissued the Associate is a findingsof violation andassessescivil penaltyof case.It makes the above-referenced action This enforcement termsaresetforth in the Final Order. The penaltypayment $35,000. serviceof that uponpayment.Your receiptof the Final Orderconstitutes automatically closes under49 C.F.R. 190.5. document S Sincerely, t J--^," yl\i Reynolds James Registry PipelineCompliance Office of PipelineSafetY Enclosure cc: Mr. Ivan Huntoon Director, CentralRegion, OPS CERTIFIEII MAIL . RETU DEPARTMENT OF'TRANSPORTATION PIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OFF'ICE OF PIPELINE SAFETY WASHINGTON, D.C. 20590 In the Matter of ) ) Mid-Valley PipelineCompany, ) Respondent. ) ) CPF No. 3-2003-5022 J FINAL ORDER On May 20-24,2llz,pursuant to 49 U.S.C. S 60117,representatives the Pipeline and of Hazardous Materials Safety Administration (PHMSA) conductedan on-site pipeline safety inspection of Respondent'sfacilities and records in its Burlington, Kentucky, Ohio, and Michigan operational areas. As a result of the inspection, the Director, Central Region, PHMSA, issuedto Respondent, letter datedAugust 26,2003, a Notice of ProbableViolation and ProposedCivil by Penalty(Ittrotice).In accordance with 49 C.F.R. S 190.207, Notice proposedfinding that the Respondent had commiued violations of 49 C.F.R. Part 195and proposedassessing civil a penalty of $35,000for the allegedviolations. Respondentrespondedto the Notice by letter dated September12,2003 (Response). Respondent acknowledged some of the allegations,offered information to explain the allegations, described the corrective actions it had taken, and requestedthat the proposedcivil penalty be reduced or eliminated. F'INDINGS OF VIOLATION Item 3 in the Notice allegedthat Respondent violated 49 C.F.R.S 195.440by failing to establish a continuing public educationprogram to enable those who could be affected by its pipeline to recognizeand report pipeline emergencies.Section 195.440requirespipeline operatorsto addresstheir public educationprograms to the public, government organizations,and fire, police, or other appropiate local officials. In its response,Respondentexplainedthat it had hand delivered calendarsto people along the right-of-way eachyear. Respondent,however, failed to demonstratethat the material in the calendarwas adequateto accomplish the purpose of the regulation. Respondentalso failed to demonstratethat its program was presentedto any government organizationsor public officials. Accordingly, I find that Respondentviolated $ 195.440by failing to establisha continuing public educationprogram to enable those who could be affected by its pipeline to recognize and report pipeline emergencies. Item4 in theNoticealleged Respondent that violated c.F.R. S 1g5.442(c) failin gto 49 by providenotificationof its damage prevention program persons to who engage excavation in activities alongits pipelinesince1996. Section195.442(c)requires pipelineoperators provide to actualnotificationof its damage prevention programto all persons who normallyengage in excavation activitiesin the areawhereits pipelineis located often asneeded makethem as to awareof the damage prevention program. In its response, Respondent explained that at the time the one-callprogramin which it participates providednotificationto emeigen"v r"rpo"a";; ;;; the damage prevention programs pipelineoperators their areas.Respondent, of in however, failedto demonstrate it providedactualnoticeof its damage that prevention progr* to any excavators'Accordingly,I find that Respondent violatedS 195.442(c) failing to providl by notificationof its damage prevention programto persons who engageinLxcavation activities alongitspipelineafter1996. Item 5 in theNotice. alleged Respondent that violated C.F.R.S 195.571 failingto ensure 49 by the cathodic protectionfor breakout tank #83 met theminimumcriteriafor tire pipe-to-soil readings years2000,2001,and2002. In its response, in Respondent not contest did this allegation.Accordingly,I find that Respondent uiolut.d S 195.571 failing to ensure by the cathodic protectionfor breakout tank #g3 met the applicable criteria. Thesefindingsof violation will be considered prior offenses any subsequent in enforcement actiontakenagainst Respondent. ASSESSMENTOF PENALTY Under49 U.S.C.S 60122, Respondent subject a civil penalty to exceed is to not per $25,000 violation for eachdayof the violation up to a maximumof$soo,oo0for anyrelatedseries of violations. 49 U'S'C.5 60122and49 C.F.R.5190.225 require that,in determining amount the civil the of penalty,I consider following criteria: nature,circumstances, giavity of the violation, the and degree Respondent's of culpability,historyof Respondent's offenses, prior Respondent's ability to pay thepenalty,goodfaith by Respondent attempting achieve in to compliance, effecton the Respondent's ability to continuein business, suchothermatters justice may require. and as With respect Item 3, theNoticeproposed civil penalty $ 15,000 failingto establish to a of for a continuingpublic education programto enable thosewho couldbe affectedby iis pipelineto recognize reportpipelineemergencies. and Developing implementing effectivepublic and an education programis an importantpart of operating pipelinesafely. Stakeholders a needto know how to recognize pipelinelocationmarkers andwhatkinasof precautions they shouldtake,what kinds of properties commoditybeingtransported andhow to recognize respond a the has, and to pipeiineemergency. Pipelineoperators obligated fully meetthe reqirirement a are to for continuingpublic education programandto present programto all affectedstakeholders the because failure to do so canput the public safetyat increased the risk. Respondent presented has no information that would warrant a reduction in the civil penalty amount proposed in the Notice for this violation. Accordingly, I assess Respondent civii p"nuity of $tS,OOO violating 49 a for c.F.R. g 19s.440. With respectto Item 4,theNotice proposeda civil penalty of $15,000for failing to provide notification of its damageprevention program to personswho engagein excavation activities along its pipeline after 1996. Preventing damagelo pipelines .u*J by excavation activity is an important part of operating a pipeline safely. Excavatorsneed to be made aware of the existence of pipelines in their area. Pipeline operatorsare obligated to provide notice of their damage prevention programs to excavatorsincluding information about pipeline location marking] utilizing the one-call systemprior to excavation activity, and what to do if the pipeline is damagedduring excavation. In this case,Respondentiast sent out a mailer to excavators in 1996' We acknowledgethat Respondenthas initiated actions to addressthis violation including using its one-call program to addressnotification of excavatorsbeginnin gin2003. respondent,however, has provided no information that would warrant a reduction in the civil penalty proposed in the Notice for this violation. Accordingly, I assess Respondenta civil penaity of $15,000for violating49 C.F.R. g t95.aa2@). With respectto Item 5, the Notice proposed a civil penalty of $5,000 for failing to ensure the cathodic protection for breakout tank #83 met the applicable criteria. Ensuring that pipeline systemshave adequatecathodic protection is an important part of preventing releaseincidents causedby corrosion. If an inadequacyin cathodic protection is identified during an annual survey, pipeline operatorsare obligated to take prompt corrective action. We acknowledge that Respondentcorrectedthe condition in June 2002. Nevertheless,the cathodic protection for breakout tank #83 was below the applicable criteria for three years. Respondanthas presented no information that would warant a reduction in the civil penalty proposedin the Notice for this violation. Accordingly, I assess Respondent civil p..tulty of $5,000for violating a9 C.F.R. a $ 195.571 . Accordingly, having reviewed the record and consideredthe assessment criteria. I assess Respondent total civil penalty of $35,000. a Payment of the civil penalty must be made within 20 daysof service. Federalregulations (49 C.F.R. S 89.21(b)(3))requirethis paymentbe madeby wire transfer,through the Federal ReserveCommunications System (Fedwire), to the account of the U.S. Treasury. Detailed instructions are contained in the enclosure. Questionsconcerning wire transfers should be directed to: Financial OperationsDivision (AMZ-120), Federal Aviation Administration, Mike Monroney AeronauticalCenter,P.O. Box 25082,OklahomaCity, OK 73125;(405) g54:-471g. Failure to pay the $35,000 civil penalty will result in accrual of interest at the current annual rate in accorciance with 31 U.S.C.S 3717,31 C.F.R.S 901.9and 49 C.F.R.S 89.23. pursuantto those same authorities, a late penalty charge of six percent (6%) per annum will be charged if paymentis not made within 110 daysof service. Furthermore, failure to pay the civil penalty may result in referral of the matter to the Attomey Generalfor appropriate action in a United StatesDistrict Court. WARNING ITEMS The Notice did not propose a civil penalty or compliance order for Items land,2 in the Notice. Therefore, these are consideredwarning items. The warnings were for Respondent,s failure to addressthe requirementsof SubpartH of Part 195 in its operationsand maintenance procedures in accordancewith g 195.402, and failure to demonstrate thatthe monthly inspection of breakout tank #69 has been performed in accordancewith 1g5.432(b). Respondentpiesented S information its responseshowing that it has initiated actionsto addressthese items. Respondent is warned that if these items are not fully addressed, enforcementaction will be taken if a subsequentinspection reveals a violation. Under 49 C.F.R. S 190.215,Respondent a right to submit a petition for reconsideration has of this Final Order. Should Respondentelect to do so, the petition must be received within 20 days of Respondent'sreceipt of this Final Order and must contain a brief statementof the issue(s). The filing of a petition automatically staysthe payment of any civil penalty assessed. However if Respondentsubmits payment for the civil penalty, the Final Order becomesthe final administrative decision and the right to petition for reconsiderationis waived. The terms and conditions of this Final Order are effective on receipt. JAI'I- 3 fl06 $^ Date Issued Administrator