JOHN BEL EDWARDS GOVERNOR THOMAS F. HARRIS SECRETARY DEPARTMENT OF NATURAL RESOURCES . OFFICE OF CONSERVATION RICHARD P-IEYOUB COMMISSIONER OF CONSERVATION December 22, 2017 Mr. Trey Kuchar, Vice President CenterPoint Energy Resources Corp. 525 Milam St. Shreveport, LA 71 101 RE: Pipeline Safety Section Field Inspection Report CERTIFIED MAIL November 7, 2017 RETURN RECEIPT REQUIRED Citation No. 654 ARTICLE NO. 7013 2630 0001 2340 9355 Dear Mr. Kuchar: On September 28, 2017, a Pipeline Safety InSpection was completed on your gas distribution system. During said inSpection, your facilities were found to be in probable violation (violation(s) enclosed) of the Louisiana Administrative Code, Title 43, Part of the Of?ce of Conservation pertaining to minimum gas Pipeline Safety standards as authorized by the Natural Resources Act of 1973, Chapter 7, Title 30 of the Louisiana Revised Statues of 1950, comprised ofR.S. in the following respects: Title 43 NATURAL RESOURCES Part Of?ce of Conservation--Pipeline Safety Subpart 3. Transportation of Natural or Other Gas by Pipeline: Minimum Safety Standards [49 CFR Part 192] ?2705. Procedural Manual for Operations, Maintenance, and Emergencies [49 CFR 192.605] A. General. Each operator shall prepare and follow for each pipeline, a manual of written procedures for conducting operations and maintenance activities and for emergency reSponse. For transmission lines, the manual must also include procedures for handling abnormal operations. This manual must be reviewed and updated by the operator at intervals not exceeding 15 months, but at least once each calendar year. This manual must be prepared before operations of a pipeline system commence. Appropriate parts of the manual must be kept at locations where operations and maintenance activities are conducted. [49 CFR ?2725. Odorization of Gas [49 CFR 192.625] 1. Quarterly Reports 1. To assure the proper concentration of odorant in accordance with this Section, each operator must conduct quarterly sampling of combustible gases using an instrument capable of determining the percentage of gas in air at which the odor becomes readily detectable. Operators of master meter systems may comply with this requirement by: [49 CFR Post Of?ce Box 94275 - Baton Rouge, Louisiana 70804-9275 - 617 North 3rd Street - 9th Floor - Baton Rouge, Louisiana 70802 Phone (225) 342-5505 - An Equal Opportunity Employer CenterPoint Energy Resources Corp. Page 2 ?2719. What is the Maximum Allowable Operating Pressure for Steel or Plastic Pipelines? [49 CFR 192.619] A. No person may operate a segment of steel or plastic pipeline at a pressure that exceeds a maximum allowable operating pressure determined under Subsection or of this Section, or the lowest of the following: [49 CFR 1. the design pressure of the weakest element in the segment, determined in accordance with Chapter 9 and 11 of this Subpart. However, for steel pipe in pipelines being converted under ?5 14 or uprated under Chapter 25 of this Subpart, if any variable necessary to determine the design pressure under the design formula (?905) is unknown, one of the following pressures is to be used as design pressure: [49 CFR a. 80 percent of the first test pressure that produces yield under Section N5 of Appendix 1331.8 (incorporated by reference, see ?507), reduced by the appropriate factor in Subparagraph A.2.b of this Section [49 CFR or if the pipe is 12 3/4 in. (324 mm) or less in outside diameter and is not tested to yield under this Subsection, 200 psi (1379 kPa) gage; [49 CFR 2. the pressure obtained by dividing the pressure to which the segment was tested after construction as follows: [49 CFR a. for plastic pipe in all locations, the test pressure is divided by a factor of 1.5; [49 CFR b. for steel pipe Operated at 100 psi (689 kPa) gage or more, the test pressure is divided by a factor determined in accordance with the following table: [49 CFR - i FaCtors], Segment" 3' . . - Installed Installed 'Converted Ciass is, . Loca? - -_be_fore after under. on - (Nov. 12, 11,- 5 1970) 'r 1970) ?192.14 1 1.1 1.1 1.25 2 1.25 1.25 1.25 3 1.4 1.5 1.5 4 1.4 1.5 1.5 lFor offshore segments installed, uprated or converted after July 31, 1977, that are not located on an offshore platform, the factor is 1.25. For segments installed, uprated or converted after July 31, 1977, that are located on an offshore platform or on a platform in inland navigable waters, including a pipe riser, the factor is 1.5 . CenterPoint Ene1gy Resources COrp. Page 3 3. the highest actual operating pressure to which the segment was subjected during the ?ve years preceding the applicable date in the second column. This pressure restriction applies unless the segment was tested according to the requirements in Paragraph A2 of this Section after the applicable date in the third column or the segment was uprated according to the requirements in Chapter 25 of this Subpart. [49 CFR Pipeline Segment Pressure Date Test Date wOnshore March 1 5, 5 years gathering line that 2006, or date preceding ?rst became subject line becomes applicable to this Subpart subject to this date in (other than ?27l2) Subpart, second after April l3, whichever is column. 2006. later. wOnshore transmission line that was a gathering line not subject to this Subpart before March 15, 2006. Offshore gathering July 1, 1976 July 1, 1971 lines. All other pipelines. July 1, 1970 July 1, 1965 4. the pressure determined by the Operator to be the maximum safe pressure after considering the history of the segment, particularly known corrosion and the actual operating pressure. [49 CFR NO person may operate a segment to which Paragraph A.4 of this Section is applicable, unless over-pressure protective devices are installed on the segment in a manner that will prevent the maximum allowable operating pressure from being exceeded, in accordance with ?1155. [49 CFR The requirements on pressure restrictions in this Section do not apply in the following instance. An operator may operate a segment of pipeline found to be in satisfactory condition, considering its operating and maintenance history, at the highest actual operating pressure to which the segment was subjected during the 5 years preceding the applicable date in the second column of the table in Paragraph A.3 of this Section. An operator must still comply with ?27ll [49 CFR The operator of a pipeline segment Of steel pipeline meeting the conditions prescribed in may elect to operate the segment at a maximum allowable Operating pressure determined under [49 CFR Maximum Allowable Operating Pressure: HighPressure Distribution Systems [49 CFR 192.621] No person may Operate a segment Of a high pressure distribution system at a pressure that exceeds the lowest of the following pressures, as applicable: [49 CFR Centel'Point Energy Resources Corp. Page 4 1. the design pressure of the weakest element in the segment, determined in accordance with Chapter 9 and ll of this Subpart; [49 CFR 2. 60 psi (414 kPa) gage, for a segment of a distribution system otherwise designated to Operate at over 60 psi (414 kPa) gage, unless the service lines in the segment are equipped with service regulators or other pressure limiting devices in series that meet the requirements of [49 CFR 3. 25 psi (172 kPa) gage in segments of cast iron pipe in which there are unreinforced bell and spigot joints; [49 CFR 4. the pressure limits to which a joint could be subjected without the possibility of its parting; [49 CFR 192.621 5. the pressure determined by the Operator to be the maximum safe pressure after considering the history of the segment, particularly known corrosion and the actual operating pressures. [49 CFR B. No person may operate a segment of pipeline to which Paragraph A5 of this Section applies, unless overpressure protective devices are installed on the segment in a manner that will prevent the maximum allowable operating pressure from being exceeded, in accordance with ?1155. [49 CFR Please be advised that the Enforcement section of Pipeline Safety has the authority under La. R.S. 30544 and LAC 43 Chapter 5, to assess a civil penalty in the amount of Ten Thousand Dollars ($10,000) for each violation for each day the violation persists, with the maximum civil penalty not to exceed Five Hundred Thousand Dollars ($500,000) for any related series of violations. The Enforcement section of Pipeline Safetv has suggested that the CenterPoint Energv Resources Corp. be ordered to show cause, under the authority of La. R.S. 30:544 and LAC Chapter 5, why thev should not be assessed a civil nenaltv in connection with the above cited probable violations up to $40,000.00 per dav until compliance is achieved. Under the above cited safety laws and regulations this of?ce has the authority to compromise such matters, and, in the spirit of compromise, it is suggested that a civil penalty in the magnitude of $2 500.00, without assessment of cost, would be appropriate. If this meets with your approval, please submit your payment in the amount of $2,500.00 to the Of?ce of Conservation, Pipeline Safety Division Within 14 davs after receipt of this citation, otherwise, a public hearing may be held pursuant to this citation. Relative to said violations, you are hereby ordered to submit a written proposal by January 26, 2018 to obtain compliance with the noted violations or show cause why you should not be required to do so. Your proposal should include steps to be taken and a timeline for completion of activities. Failure to comply with this Citation will result in the issuance of additional regulatory sanctions by this Of?ce. CenterPoinl Energy Resources Corp. Page 5 Pursuant to Section 507 of this regulation, if you dispute the determination made herein, within seven (7) days from receipt of this citation, the CenterPoint Energy Resources Corp. may request an informal conference with the Commissioner and/or Pipeline Safety sta? at no charge to the CenterPoint Energy Resources Corp.. Within twenty (20) days of receipt of this citation, the CenterPoint Energy Resources Corp. may request a public hearing in accordance with LS-R.S. and 8. Such a hearing request must be accompanied by a check or money order in the non?refundable amount of $755.00 as provided by the latest revision of Statewide Order No. 29-R (LAC 43:XIX.Chapter 7) or the request for a hearing will not be considered. If a public hearing is requested, a request for an informal conference will be denied. If you have any questions or comments concerning this matter, please contact Andrew Wascom at 225/342?3467. Yours truly, COMMISSIONER OF SERVATION cc: James Burns Jason Cole Ronald Day Schirmer Durio Troy Laurent Thien Le Wayne Leger Melvin Stewart File